By Clyde Mooney – editor Australian Hotelier
Singleton’s Australian Pub Fund (APF) has continued its run on prime Queensland assets, picking up Brisbane’s Stock Exchange Hotel for a State record figure of $35 million. (continues below)
The ‘Stockie’ consists of 911 square metres in the central CBD and was another purchase from the vacillating Independent Pub Group (IPG), which also recently offloaded the Elephant Arms to APF for a reported $27 million.
Speaking to TheShout, CEO of APF’s operator Riversdale Group Patrick Coughlan said the Stock Exchange is another example of their doctrine to acquire “the best pub, in the best position, in the best suburb”.
“It has a huge upside and intra-yield,” said Coughlan.
“Brisbane in general has a lot of potential – it’s a strong pub city. The Brisbane people love their pubs.”
The Hotel asset included 25 gaming machine authorities and a late-operating licence, as well as a recently approved DA to add a new third floor outdoor terrace.
Coughlan said they have no specific plans yet to re-model or theme the venue, but will be capitalising on the DA very soon.
“We’ll certainly be going ahead with the approval for an outdoor terrace, licensed for 300 people.
“It’s easier to do something ‘different’ in a city pub such as this, with predominantly CBD customers.”
Both IPG sales to APF were transacted through Jones Lang LaSalle (JLL), with national director pub investment sales John Musca describing the Queensland acquisitions as “extremely well timed from an opportunistic perspective”.
JLL manager Queensland, Paul Fraser, suggests it is part of a bigger trend, pointing to a string of sales including purchases by Redcape Hotel Group.
“We are tracking an improvement in hotel investment sentiment, albeit on a selective basis, particularly in south-east Queensland,” says Fraser.
“The recent sales of the Lost City Hotel and Waterloo Bay Hotel are evidence of this.”
Ad-man John Singleton, banker Mark Carnegie and former Tourism Australia chairman Geoff Dixon’s APF has now invested [circa] $140 million, and amassed 11 prime city or city fringe hotels in Sydney and Brisbane.
The investments boast strong departmental revenue spreads – widely viewed as the optimum low-risk / high-growth hotel business model.
In a press release by JLL, IPG CEO Greg Maitland suggests his pub group is “at a different investment cycle”, and concedes “that replacing such strategically located capital city trading footprints is not easily done".