In the same week that HTL Property sold Sydney’s Bligh Park Tavern for the De Angelis family, it has announced that Marvan Hotels has sold the Evening Star Hotel in Surry Hills to a private investor.
HTL Property’s Dan Dragicevich and Sam Handy negotiated the off-market sale which represents the agency’s eighth inner city mid-market transactions over the last 12 months.
The price for the hotel remains undisclosed, however it is understood was consistent with the leading agency’s price guidance of $12 million.
The hotel is situated within one of the inner city’s most dynamic precincts, with the property just metres from a Woolworths anchored shopping centre; and literally across the road from the commanding Central Station rail and bus interchange. The business is also a direct beneficiary of the adjacent and brand new Surry Hills light railway station; which itself is set to enjoy up to 120,000 passenger movements per day.
The Evening Star Hotel features a 24 hour liquor licence with 24 very valuable poker machines licenses attached. Surrounded by several TOP 100 and 200 ranked gaming hotels, the asset is situated within an SA2 green zone; delivering obvious upside levers by virtue of increasing the hotel’s current gaming fleet by another six machines.
“The Purchaser is a relatively new entrant to the market, which serves as an encouraging sign given this is an asset class with multiple natural barriers to entry” advised HTL Property National Pubs Director, Dan Dragicevich.
“This transaction further underlines our ability and track record with unearthing non-traditional sources of capital and delivering upon a successful outcome for all parties” added Dragicevich.
Marvan purchased the hotel in 2014 for $5.5 million and soon afterwards executed a significant renovation and refurbishment of the hotel.
“This sale marks our 8th mid-market Metropolitan pub transaction in nearly as many months, following sales of the Quarryman’s Hotel ($11.25m), Illinois Hotel ($13m), Captain Cook Hotel ($16m), Unity Hall Hotel ($19.5m), Camelia Grove Hotel ($13.75m), Friend in Hand Hotel ($10.5m) and the Royal Hotel in Richmond ($18m)” commented HTL Property Director, Sam Handy.
“Our track record and resultant market share in this segment of the market is pleasing and strengthening further; and we’re currently holding conversations with several qualified buyers seeking similar style assets” Handy added.
The sale of the brace of Sydney metro hotels, The Evening Star and Bligh Park Tavern, arrives at a time where other industries are challenged by trade impositions and business models which require greater runway in order to reignite their respective customer base. Not so the hotel industry advises HTL Property’s Managing Director, Andrew Jolliffe.
“Hotels maintain dynamic response revenue levers, such as food, beverage and gaming. As such they can very rapidly become cash flow generators; and hence why they have enjoyed a first mover benefit over other share of dollar competitors operating upon the national hospitality and leisure asset landscape” concluded Jolliffe.
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