By James Atkinson
Coles is selling three Queensland hotels and two Liquorland bottleshops in a sale and leaseback program aimed at divesting more than $15 million worth of assets.
CBRE Hotels in conjunction with Burgess Rawson are the exclusive selling agents for the Coles-owned properties, all of which are backed by long term leases to Liquorland Hotel Group, a subsidiary of the retailer.
The development follows the recent listing for sale of two of Coles’ NSW hotels as freehold going concerns, as part of an ongoing portfolio review.
A Coles spokeswoman would not comment last week on the retailer’s future strategy for the hotels business, telling TheShout: "We keep our property network under review to ensure we have the best portfolio for our business and our customers."
The three Queensland assets for sale are the Royal English Hotel in Nundah (Brisbane), the Currimundi Hotel, Liquorland and Motor Inn, Caloundra (Sunshine Coast) and the Taylors Hotel and Liquorland, Mackay.
The three individual hotel assets vary in value between $3 million and $7 million.
CBRE Hotels director Joel Fisher said the Royal English Hotel was expected to attract particularly strong investor interest, occupying a 2025sqm site in arguably Brisbane’s fastest developing suburb, Nundah, with 22 on-site car spaces and 40 gaming machine authorities.
He said the strength of the current investor market has been highlighted by several recent portfolio transactions. Earlier this year, Redcape Property Group sold three small Coles-leased hotels and three small stand-alone Liquorland bottle shops throughout far north QLD by for a combined $10 million at a blended yield of 7.75 per cent.
The assets within the upcoming Coles-leased portfolio are to be offered individually at auction at Crown Casino, Melbourne on Wednesday December 11, with live interstate bidding available in the boardroom at CBRE Brisbane and the Sydney Auction Centre on Margaret Street, Sydney.
The campaign will be steered by CBRE Hotels’ Fisher and Billy Holderhead of Burgess Rawson.
“Coles is Australia’s second largest hotel operator with around 100 hotel venues across the country,” Fisher said.
“Given the security of the lease covenant we’re expecting strong interest from passive investors, not just from Queensland but from right across the country, with all of the properties offering long lease terms and guaranteed future rental growth.”
Holderhead added: “We expect strong interest from investors seeking a long term, secure cash flow investment with guaranteed annual growth and future development potential.”
The campaign follows the successful sale of more than $250 million worth of similar assets by CBRE Hotels and Burgess Rawson over the last three years.