Redcape has announced the sale of two Sydney pubs, the Cabramatta Hotel and the El Cortez Hotel, as the fund continues to renew and diversify its portfolio.
The sale follows Redcape’s acquisition of three freehold pubs in south-east Queensland just last month, which managing director Chris Unger linked to the group’s strategy of “targeting high-potential venues in growth markets through actively managing the portfolio”.
Speaking about the decision to sell the Cabramatta Hotel and El Cortez Hotel, he stated: “The divestments will provide Redcape with capital to continue its redeployment into other opportunities in line with the fund’s stated strategy.”
Both pubs, situated in Sydney’s in Sydney’s western suburbs of Cabramatta and Canley Heights, have been acquired by Iris Capital.
Sam Arnaout, CEO of Iris Capital, commented: “Multi-dimensionally, and whilst Iris Capital operates on a national hospitality and development footprint; large format Sydney suburban hotels remain very attractive to our company.
“Primarily because, and as evidenced by the combined 17000sqm of commercial property holding, the inherent capacity for the asset class to absorb approved development upside levers is largely unparalleled.”
The transaction was handled by HTL Property, with national director Dan Dragicevich highlighting the desirability of the two venues.
“Both hotels are well known large-format multi-revenue-channelled businesses, with Cabramatta represented by two separate land holdings; and being the beneficiary of a recent planning gazettal which adds, materially, to the additional use options from a development perspective,” he stated.
HTL Property managing director Andrew Jolliffe added: “The sale of these two Redcape Hotels brings the transaction window for 2024 to a prosperous close, and separately brings the consolidated Metro Sydney hotel sales dollar value to $1bn; in line with the record set in 2022, when markets of all persuasion rebounded positively.”
Despite ongoing interest in Western Sydney’s pub market, the recent transaction is a continuation of Redcape’s sales in this region, having also sold the Vauxhall Inn in Granville and Wattle Grove Hotel in Liverpool in September last year for a combined value of $73m.
Redcape has however retained its interest in Sydney’s inner city pubs, and acquired the leasehold interest of The Criterion Hotel earlier in 2024. The transaction was part of an asset exchange with Gallagher Hotels, in which it also sold the freehold of the Crescent Hotel in Fairfield in an exchange worth $70m.