Regional pub sales hit $75m as operators compete with investors

Regional pubs are proving as lucrative as their city cousins, the popular Port Macquarie Hotel setting a record sale price of $57 million for the Mid North Coast of NSW, while a site in Tamworth went for $18 million.

The large Port Macquarie pub has been a focal point for the community for 80 years and was sold by the Taphouse Group, which paid $15.8 million for the venue in December 2010 from the then-listed Redcape Hotel group.

Taphouse is run by the co-founders and families of the formerly listed direct marketing and communications company Salmat, Peter Mattick and his late business partner Phil Salter.

The Port Macquarie Hotel sold to a Sydney hotelier.
The Port Macquarie Hotel sold to a Sydney hotelier.

The sale was handled by HTL Property agents who were only authorised to say a private NSW hotelier bought the Port Macquarie Hotel. Taphouse is also selling the Tacking Point Tavern near Lighthouse Beach, also through HTL Property.

The imposing two-storey art deco pub sits on 2878 square metres across multiple street fronts and generates about $25 million in annual revenue from a bar, restaurant, pokies and hotel-style accommodation.

“Interest in our public expressions of interest process last month drew activity from a national investor landscape, and highlighted the magnetism of multi-revenue faceted hotels in key geographical centres along Australia’s east coast,” HTL Property director Sam Handy said.

In the past year, sales of regional pubs and hotels have boomed as tree-changers and city-based hotel operators opt to move further away from capital cities.

Veteran pub operators and investors Arthur Laundy and John Singleton have earmarked the Mid-North Coast as a growth area, with both buying large-scale properties in an around the district.

Further inland a private hotel fund paid $18 million for the Best Western Sanctuary Inn, Tamworth. HTL Property directors Nic Simarro and Andrew Jackson managed the off-market sale.

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Best Western Sanctuary Inn comprises 60 rooms, conferencing and event space and the popular Riviera bar and grill restaurant.

“High-performing regional hotels such as Best Western Sanctuary Inn Tamworth are rare to come by, despite being the most attractive to large investment funds,” Simarro said.

“We are seeing significant interest from such funds looking for price points greater than $15 million, especially in the regional space, and this is a major contributor to the exceptional result on this sale.”

Jackson said there was the same high-level of interest in Mercure, Port Macquarie which the agents sold for $23.5 million in January to a Sydney consortium including the Laundy family.

“These larger funds and syndicates are looking to deploy as much capital as possible, and accordingly these larger deals are in high-demand given there exists a patent shortage of opportunities,” Jackson said.

In the far west of NSW, the private owners of the Broken Hill pub, known as the BHP, are selling the freehold business through JLL hotels & hospitality group’s executives Greg Jeloudev and Kate MacDonald.

The 1827 square metre pub is predominantly a food and beverage-based business that has recently been repositioned as a quality “gastro venue” where weekly total sales are about $61,000.

“There is a fantastic opportunity to enjoy immediate income from this impressive asset with further upside to be created via an accommodation offering,” Jeloudev said.

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Source: Thanks smh.com