By Andrew Starke

The Australian Leisure & Hospitality Group (ALH) will sell its freehold interest in a major site on the Gold Coast in what is likely to be one of the largest freestanding investment offerings in Queensland this year.

The sale, which is being handled by CBRE Hotels, includes the Varsity Lakes Tavern, a Dan Murphy’s retail outlet and one of the largest Fitness First gymnasiums in Australia.

The property is being sold via a tender process closing on Thursday May 26, 2011.

CBRE Hotels director Joel Fisher said the size of the investment and the underlying strength of the lease covenants were expected to generate significant national and international interest in the sales campaign.

The ALH Group is 75 percent owned by Woolworths and 25 percent owned by the Bruce Mathieson Group, operating more than 285 licensed venues and over 450 retail liquor outlets across Australia.

“The ALH covenant will be a significant attraction for prospective purchasers as will the fact that the site offers a diverse income stream from the Tavern, Dan Murphy’s retail outlet and Fitness First,” said Fisher.

“The property represents effectively three of the best freestanding investment assets offered on the Gold Coast in some time, all rolled into one investment.

“We expect strong interest in the property from both private and institutional investors alike, as offerings of this scale are very seldom offered to the market.”

The offering includes the Tavern, which was developed in 2004 and which houses a Public Bar, Sports Bar, Gaming Room and large restaurant / bistro.

The site also includes a large Dan Murphy’s retail outlet also constructed in 2004.

Both are leased to ALH on a 20-year term with five 10 year-options – translating to a total lease term of 70 years.

“We are continuing to field strong investor interest in good quality hotel offerings such as Varsity Lakes which have strong trading positions and offer very long solid lease covenants with guaranteed annual rental increases, indexed to CPI,” CBRE Hotels manager Craig Harley told TheShout.

“The long term, secure nature of the leases to grade A covenants represents a very unique opportunity for an astute investor to acquire a secure, long term cash flow investment with annual CPI growth factored in.”


The Shout Team

The leading online news service for Australia's beer, wine, spirits and hospitality industries.

Leave a comment

Your email address will not be published. Required fields are marked *