Larger pub groups continue to capitalise on low interest rates by swooping in on pub transactions all over the country.
Just in the last few days, a few major pub transactions have been announced in Queensland and New South Wales. On the Sunshine Coast, Australian Venue Co has acquired the Surfair Beach Hotel in Marcoola. The acquisition emphasises AVC’s dual focuses on a significant presence in Queensland, as well as its continued focus in tourism-driven areas.
The hotel’s freehold and leasehold was purchased in tandem by Hotel Property Investments (ASX: HPI) and AVC in tandem, continuing the two entities’ landlord/tenant relationship.
The beachfront pub is located 25 minutes south of Noosa, and adjoins Wyndham’s Ramada Hotel. The hotel was sold by the Scanlon family, with HTL Property’s Glenn Price and Brent McCarthy leading the off-market sale campaign.
“It is a credit to the Scanlon family for what they have created at the hotel, and regarding the solid business that has stemmed from their tireless efforts over the last seven years of ownership,” stated Price.
“The business has undoubtedly become one of the leading hotels on the Sunshine Coast during the family’s tenure,” added McCarthy.
“The hotel enjoys all the solid, well rounded business fundamentals that AVC were looking for in a hotel asset on the coast; with the added ability to further expand the multiple revenue streams. In handing the baton to AVC, the business is in safe hands and is certain to continue to grow prosperously into the future.”
Sydney sales
In Sydney, two significant pub sales have been announced in the last few days as well. The Wagon Wheel Hotel in south-west Sydney has been sold via an off-market campaign by JLL Hotels & Hospitality.
The St Mary’s pub was sold by the private owners and includes 25 EGMs, public and bistro bars, bistro dining, TAB and onsite parking, and a 3am trading licence. The Wagon Wheel Hotel occupies a 1,937 sqm site in the town centre.
JLL would not be drawn on the identity of the purchaser, only commenting that they had “an impressive Western Sydney hotel operating pedigree”. Industry sources suggest the sale price was circa $17 million.
Closer to the CBD, Colonial Leisure Group has sold the leasehold of the Newtown Hotel to the Universal Hotels, led by the Kospetas family. The off-market sale was also handled by JLL Hotels & Hospitality.
“This sale shines a light on asset demand at all levels and speaks to the market’s desire to secure fundamentally sound businesses in tightly held, key trading precincts such as Newtown,” stated JLL’s Ben McDonald.
“Newtown Hotel is a dynamic, inner west venue with significant brand equity and broad market appeal in one of the strongest retail locations in the country being King Street, Newtown.”
“We are buoyed by increasing transactional activity and see no abatement of buy side demand for pub assets across the board.”
The sale of the Newtown Hotel leasehold sees the Victorian-based Colonial Leisure Group exit the New South Wales pub market, while remaining active in Melbourne, Perth and Brisbane. For Universal Hotels, it’s the latest acquisition in what has been a busy year – both with the significant rebuilding and opening of The Mill Bondi, and the sale of Kinselas to Moelis Australia Hotel Management.
Another Wagga Wagga pub sale
A third Wagga Wagga pub sale in as many weeks has also been announced this morning, with the freehold interest of the Duke of Kent Hotel in the town being sold. It was acquired by the same syndicate led by Sam Cruikshank and Sean O’Hara that recently purchased the Sportsmans Hotel and already owns the Turvey Tavern.
The off-market campaign was led by HTL Property’s Blake Edwards, on behalf of vendor Bruce Whyte. The hotel is leased long-term to local operator Ward Gaiter.
“We like pubs and we like Wagga Wagga, so we asked Blake to approach the vendors and broker a deal,” stated Cruikshank.
“We paid more than we wanted to, but in the long run it will be a great investment.”
The Duke of Kent Hotel sale joins the Sportsmens Hotel and Romano’s Hotel as the third pub transaction to be announced in the last few weeks.