Private Hotelier beats major players to secure high value target

JLL Hotels & Hospitality Group in conjunction with Moore & Moore Real Estate has today announced the sale of the highly coveted Lake Macquarie Tavern in Mount Hutton NSW for $33m.

Situated approximately 140km’s north of Sydney and 14km’s from Newcastle CBD, the hotel sits prominently in one of the fastest growing regions on the NSW coast.

JLL Hotels Senior Vice President Ben McDonald and Moore & Moore Real Estate Principal, Deane Moore brokered the sale on behalf of long-time owners and prominent industry identities, Paul Crosbie and Bob Warren, who have owned the hotel for over two decades. Generating 65 enquires, including many from some of Australia’s most successful operators, family groups and corporate hotel investors, the hotel was keenly contested with close to a dozen bids generated during the process.

The hotel’s market appeal was underpinned by its 9,000sqm site area, 30 gaming machine entitlements, late trading approval and location, adjacent to Lake Macquarie Square – one of the largest and best performing retail centres in Lake Macquarie City.

Reflecting one of the biggest prices paid outside of Sydney so far in 2022, JLL Hotels’ Ben McDonald highlighted the reservoir of untapped potential in the asset being a key driver of the ultimate sale price which reflected a market topping 5.4% cap rate.

Mr McDonald said, “Despite a potential shift in the economic environment, hoteliers with long term investment horizons are continuing to compete aggressively for assets that exude quality and are underpinned by strong trade fundamentals in locations they know and understand.”

The successful purchaser of the tavern was Don Hodge Group Inc - a family business with significant interests in hotel, trucking and aviation. The business, now run by second generation Don Hodge Jr. also counts the nearby Belmont and Warners Bay Hotel among assets in their vast hotel portfolio.

Speaking on the sale, Moore & Moore Real Estate Principal Deane Moore had this to offer; “Being appointed by Mr Warren and Mr Crosbie who are considered hotel industry forefathers is humbling to say the least. The Lake Macquarie Tavern was a highly contested asset, and my vendors are extremely happy to see youth follow in their footsteps.”

JLL Hotels remains ultra-bullish on the NSW pub market as evidenced with their two most recent listing being the well renowned Minskys Hotel and Commercial suites in Cremorne on Sydney’s Lower North Shore and the Sports Hotel in Bankstown – one of Western Sydney’s most sought-after pubs. Both assets are being sold via Expressions of Interest closing May 2022.

JLL, 8^th April 2022