Sydney pub market off tap, bar baron says
Sydney bar king Justin Hemmes has confirmed the city’s pub boom is still in full swing, with his private Merivale operation snapping up northern beaches watering hole The Collaroy in a play worth about $21 million.
A series of purchases by Hemmes and investment bank Moelis, which bought the $677 million Redcape Hotel Group portfolio, have prompted suggestions the market is peaking.
But many of the deals are being driven by long-time publicans and, in the case of Moelis, a desire to list pub assets on the Australian Securities Exchange, despite their chequered record.
Commercial Insights: Subscribe to receive the latest news and updates
Hemmes, chief executive of Merivale, says The Collaroy is in a “truly spectacular” location, with sweeping views of the ocean and sand literally at its door step.
“This is a really exciting addition to the group, and one that will beautifully complement what we’re creating at The Newport,” he says, referring to the pub he bought for close to $50 million in 2015 and is now redeveloping.
“I love the northern beaches; it is a magnificent area and we are incredibly proud to be part of it,” he adds.
Ray White Hotels Asia Pacific director Andrew Jolliffe brokered the deal on the multi-storey freehold hotel. It was sold by Mitchell Waugh’s Public House Management Group, which earlier this year acquired Sydney’s Toxteth Hotel in Glebe for $20 million from high-profile businessmen John Singleton and Geoff Dixon’s Australian Pub Fund.
The Collaroy Hotel was purchased by Waugh and his backers at auction in 2010, and since acquiring the beachfront hotel, the group conducted a wholesale renovation in 2014.
The Collaroy Hotel adds to Merivale’s growing stable of A-grade hospitality properties, including the Coogee Pavilion in Sydney’s eastern suburbs.
Jolliffe would not be drawn on price, but says the deal shows the hotel market is still exhibiting strong investment fundamentals.
This article originally appeared on www.theaustralian.com.au/property.
