By Vanessa Cavasinni, editor Australian Hotelier
Gallagher Hotels and Iris Capital have struck a deal in which two of their pubs swapped hands.
In what is a record transaction in half a decade for Sydney pub real estate, Iris Capital and Gallagher Hotels have transacted the Tiger Bar Hotel in Hurstville and the Hunters Hill Hotel in a deal worth $65 million. Iris Capital will take the reins of the high-ranking gaming venue in Hurstville, while Gallagher Hotels will add the F&B-focused Hunters Hill Hotel to its portfolio.
John Musca, national director off JLL Hotels & Hospitality, negotiated the sale.
"The asset transactions are manifest examples of the astute divergence in investment and operating strategies of two highly respected industry stakeholders at a particular point in time, reflecting class-leading thinking on both their parts."
Patrick Gallagher agreed, stating that the when the deal was floated to him, it was clear that the transaction played to the two group’s operating styles.
“It was a transaction that was put to me for various operational reasons, and it suits me on my side for similar reasons.”
The Tiger Bar Hotel is a relatively new pub, opening in 2012. The venue sits within a retail and entertainment precinct opposite both bus stops and a train station, in an area which is seeing an influx of residents. These factors, along with its TAB and gaming facilities and restaurant, made it an attractive purchase for Iris Capital, whose new direction includes development opportunities across New South Wales.
Hunters Hill Hotel, which was extensively renovated by Iris Capital in 2014, sits on a 5000 sqm site alongside a mixed used complex of retail stores and residential apartments, plus a 120-bay carpark. The site has also been approved for the construction of an additional four rooftop apartments.
"Much like the Oaks Hotel in Neutral Bay and the Golden Sheaf Hotel in Double Bay, the Hunters Hill Hotel is a cornerstone, integral community establishment and a truly generational asset the likes of which are rarely traded," stated Musca.
Gallagher stated that he was looking forward to trading Hunters Hill Hotel.
“We’d done well where we were, Tiger Bar’s been fantastic to us. Hunters Hill Hotel is a tremendous opportunity, being my local hotel. There’s levels of appeal to it.
“It’s a large food and beverage operation, which is what we really enjoy.”
He also suggested that there were no plans at this stage to renovate the hotel, citing Iris Capital’s recent transformation of the pub.
“We’ll just try and do our best there but I think it’s been done pretty well by the previous guys. It’s a fantastic pub in a fantastic area with a great offering.”