Sydney’s Belmore Hotel continues strong run of pub sales
Pub buyers are counting on Australians’ love of having a beer as last week’s extraordinary run of purchases continues with Sydney’s Belmore Hotel changing hands for about $50 million.
The deal marks yet another major sale among the highest prices for a gaming hotel this year.
But even pubs with no pokies have shattered records, with Byron Bay’s The Beach Hotel snapped up by investment bank Moelis for $100 million.
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The big attraction of that property is its beachfront position while the Belmore’s ever-rising pokies turnover was its big drawcard. Both sales speak to different elements of the increasingly lucrative game that is drawing some of the nation’s savviest investors.
The Sydney sale is founded on the lucrative income streams that poker machines are spinning off while the Byron deal points to the valuable real estate many pubs occupy. The sale to the investment bankers set a new record for Australian watering holes.
Developed by Paul Hogan’s sidekick John “Strop” Cornell in the 1990s, the property will be held in a Moelis-run trust, marking another shift in the industry from a much-loved original owner to financiers.
Cornell sold out of the property 12 years ago and pubs across Australia have since become big business for private equiteers like KKR that have run of the sector alongside publican families.
The sales show that demand for hard assets is rising as share markets remain uncertain, with experienced purchasers believing they can pour capital into pubs and boost their performance.
The rise in hotel values is widespread with a Newcastle pub, the Kent Hotel, also selling last week at a record for the city.
Former Sydney lord mayor and philanthropist Nelson Meers, who owns about 10 pubs, bought the Belmore for about $50m.
HTL Property’s agents Dan Dragicevich and Andrew Jolliffe brokered the latest sale, saying it capped a busy year.
Other deals include the Allawah Hotel selling to billionaire Justin Hemmes for $33 million and the Raby Tavern for $35 million and the St George Tavern at $47 million.
All these sales were struck over just the last eight weeks.
The Belmore was sold by the Joel Fisher-led Monarch Hotels, that has been selling down its portfolio over the past couple of years, having already offloaded the Banksia Hotel to Patrick Ryan and the Lidcombe Hotel to Kent Walker in the last period.
Monarch is still a big believer in pubs and owns the Macquarie Hotel in Sydney’s southwestern suburb of Liverpool.
A round of sales are still to be unveiled this year with agents saying the boom will continued unabated as fresh capital is still looking for a home.
This article originally appeared on www.theaustralian.com.au/property.