By Vanessa Cavasinni, editor Australian Hotelier
Lantern have offloaded two of their western Sydney gaming pubs at a premium, and are now looking to sell their flagship pub, Five Dock Hotel.
The ASX-listed hotel group have sold both Uncle Bucks Hotel in Mount Druitt and Ambarvale Hotel in Campbelltown in the last week, beginning its sell-down strategy to divest the company of its entire hotel portfolio.
CBRE Hotels’ Daniel Dragicevich and Sam Handy handled both sales, with Uncle Bucks Hotel selling for $25.3 million to the De Angelis Hotel Group, which operates several gaming pubs in south-west Sydney; Ambarvale Hotel was sold to an undisclosed Sydney publican for $21.2 million. The sales represent a 30.5 percent and 50.2 per cent premium on book values as at 30 June 2016, respectively.
Dragicevich noted that there was plenty of interest in both pubs, with very few top 200 gaming pubs being placed on the market.
“Prior to these sales, just three genuine Top 200 gaming hotels had transacted over the course of 2016 and there is expected to be very limited availability of pubs in the gaming segment in the foreseeable future.”
In light of these sales, Lantern Hotels Group have also placed their flagship venue, Five Dock Hotel in Sydney’s inner west, on the market, with Andrew Jolliffe of Ray White Hotels handling the EOI campaign.
The Five Dock Hotel is situated on the corner of the main thoroughfare of what is both a residential and commercial precinct, and boasts three levels of trading, as well as 30 EGMs. There is also plenty of scope to revive various revenue streams.
“The recent capital investment by Lantern Hotels, largely in the form of gaming machine hardware, has seen a demonstrable and very positive profit injection for the business unit. This augurs well for the successful acquirer, given both the upward revenue trajectory curve the hotel is undeniably dialled in to, as well as the fact that a material capital works sum of money has already been expensed by the outgoing vendor," commented Joliffe.
Five Dock Hotel is likely to be the last pub Lantern Hotels Group places on the market in 2016, before resuming its sell-down strategy in 2017.