Cashed-up NSW families pounce on prime pubs as Redcape continues to sell

Redcape has sold the Unanderra Hotel in NSW for close to $15m.

The sell down of Redcape Hotel Group’s assets continues apace with the divestment of three pubs worth more than $85m over the past week, to cashed-up pub owning NSW families.

Oscars Hotel Group, helmed by Bill and Mario Gravanis, which is one of the largest privately owned hospitality groups in Australia with 46 assets, picked up the Unanderra Hotel near Wollongong in Sydney’s south for close to $15m late last week.

Redcape’s Mount Annan Hotel in outer Sydney was purchased by a major pub-owning family for $50m-plus, and the Eastern Creek Tavern went for more than $20m to the Fal Group owned by the Falcone family, according to sources.

The Falcone family also owns The Haymarket Hotel close to the Sydney CBD, The Office Hotel near Sydney’s Wynyard, and The Red Cow in Penrith, in Sydney’s outer west. The buyers of the Mount Annan Hotel have placed strict confidentiality disclosures on their identity.

All up, Redcape Hotel Group has sold seven hotels within the past five months for a combined value of more than $150m, since the owner operator of the portfolio of $1.4bn worth of gaming venues in NSW and Queensland decided to start shedding assets.

Redcape is one of the unlisted property funds taking a hit from changing values and it suspended redemptions mid-year, with the asset sales putting it on the path to getting liquidity back to investors.

Redcape has sold the Mt Annan Hotel to an anonymous buyer.

In a statement on Monday, Redcape managing director Chris Unger said the company informed investors in July of its strategy to “leverage the depth and quality of our portfolio to strengthen the balance sheet through selective divestment”.

“We are pleased with the progress we have made to fulfil this strategy quickly and our ability to exchange contracts ahead of book value.

“In addition to the successful divestments, we are seeing improved trading dynamics across our portfolio as pubs continue to be a popular choice for customers. This combination supports our confidence in the sector and positions the Fund well for investment in further growth initiatives and a sustainable reinstatement of the Fund’s liquidity facility in due course.”

The off-market sale of Unanderra Hotel for $14.5m was managed by JLL Hotels & Hospitality Group’s John Musca.

Meanwhile, HTL Property’s Andrew Jolliffe and Dan Dragicevich brokered off-market deals for the sale of Eastern Creek Tavern and Mount Annan Hotel.

The venues were sold to two separate operators, for a combined value of more than $70m.

Mr Jolliffe said traditional hotels, particularly those that are multi-departmental in terms of revenue attraction, enjoy a resiliency that serves as both a magnet for investor attention and are the basis upon which they can outperform in all manner of economic environments.