Hotel Sorrento knows how to show its guests a good time. Part of the furniture since 1872 in Sorrento, on Victoria’s Mornington Peninsula, the summer hotspot has five bars, two restaurants and, of course, accommodation.

But in December, it unveiled a five-years-in-the-making transformation that’s further broadened its appeal. “It was about going from a hotel to a resort,” says Bridget Bailey, whose family, the Pitts, have been the custodians of the pub for more than 40 years. “We’ve always been good at the ‘play’. Now we want to offer a balance of play and rest.”

Chasing a new level of coastal luxury, as Bailey says, Hotel Sorrento has added 13 suave new suites, a 30-metre pool and sun-drenched terrace, and a labyrinthine day spa. “If you’re staying with us, we want you to feel like you don’t have to leave,” she adds. Get among the party crowd if that’s your vibe, or get away from it altogether. It’s up to you.

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First and foremost, the design – a collaboration with local firm Six Degrees Architects – honours the original limestone building. But it also gives the hotel a higher-end edge. “Everything we added had to talk to what was already here,” says Bailey. “And we’re surrounded by natural beauty, so we really focused on drawing the outside in.”

There’s nothing in-your-face about the new suites; instead, they ooze understated elegance. The bathrooms are splashed floor-to-ceiling with textural travertine tiles, the private outdoor terraces are fitted with freestanding circular marble bathtubs, and European oak is another muted note in the mix. (NB: If you’re not splashing out on a new suite, fear not; all pre-existing rooms have been refurbished in the past two years.)

When it’s time to swap the bath for a bigger body of water, drape yourself in a robe by Melbourne homewares label Hommey and slink out to the pool. It’s guests-only – so rarely overrun – and importantly, “There’s a daybed for pretty much everyone,” says Bailey. Olive trees and green-and-white umbrellas aim to give the surrounding terrace an air of the Med, while a wading area lets you sun yourself while semi-submerged, and a dedicated poolside bar lets you order poached-prawn club sandwiches and Mandarin Margaritas direct to your daybed.

But it gets more Rancho Relaxo than that. In a quiet, tucked-away corner of the hotel is Marlo Spa, its series of treatment (and steam) rooms connected by travertine-clad hallways. The Pitts, while prolific publicans, decided to leave the wellness aspect to an expert, recruiting local spa-industry veteran Marlo Johnston to operate it for them. The treatment menu is extensive, running the gamut from warm stone massages to aromatic full-body scrubs, to ayurvedic therapies (a mind-body practice from India).

There’s now not much that Hotel Sorrento doesn’t offer, which Bailey hopes will help draw more visitors to Sorrento both inside and outside of the peak summer period. “Sorrento has experienced such exponential growth over the last five years, with more and more holiday-makers choosing to call it home,” she says. “That’s brought a new energy to the town year-round, rather than it being so dramatically seasonal.”

Not to mention to the multimillion-dollar renovation of the nearby Conti, as well as the addition of excellent eateries like Bistro Elba and Stringers to Sorrento’s main street.

Sunset suites start at $550 per night. Book online.