Pub investors keep records tumbling as other sectors stagnate on rising interest rates

Big-ticket pub sales are proving to be a bright spot in commercial property markets as values continue to rise while other sectors stall.

In New South Wales alone, pub sales hit a record of just over $1bn in sales in the six months to June 30, and more are under way.

Pub broker HTL Property negotiated $739m of those transactions, and agency director Andrew Jolliffe identified a series of large sales.

These include the $160m acquisition in April of the Crossroads Hotel at Casula, 34km west of Sydney, by former Sydney lord mayor Nelson Meers.

More recently, casino owner Sam Arnaout’s Iris Capital paid $80m for the Strathfield Hotel closer to the Sydney CBD.

Sydney’s former lord mayor, Nelson Meers, is behind the $160m purchase of the Crossroads Hotel. Picture: Richard Dobson

“Investors have identified the hotel as an asset class, as one which has the ability to pass on rising costs and still enjoys significant levels of protection because of high barriers to entry,” Mr Jolliffe said.

The boom is also happening in other states.

In Brisbane, this week HTL negotiated the sale of the city’s landmark Gambaro hotel and restaurant to the Australian Rugby League Commission for more than $25m. It plans to turn the building into a league-themed venue.

Iris Capital reportedly has paid a $80m for the Strathfield Hotel in Sydney.

The commission said the transaction represented its first investment to strengthen the sport’s financial position and acquire assets that “protect the game and provide new revenues for reinvestment in the game”.

The hotel will be rebranded as the NRL and have themed rooms named after the sport’s legendary players.

“The ARLC has a focus on strengthening its balance sheet with stable, secure investments that provide steady income, long-term capital growth and to protect the game against major interruptions,” the sports body said.

Brisbane’s Gambaro Hotel, which has been bought by the Australian Rugby League Commission.

The commission said the hotel was ideal for the NRL as it was located 300m from Suncorp Stadium. The venue hosts all Brisbane Broncos home games and from 2023 will host eight Dolphins home games.

The Gambaro family will continue to operate the food and beverage facilities.

The ARLC is understood to have struck a management agreement with the Gambaro family which has operated the premises for 50 years.

It comprises a 68-room boutique hotel and numerous options for expansion and development.