Another Sydney gaming pub sells for top dollar

Australian Leisure Group has continued its re-shuffle, successfully divesting an ALH-leased top 25 gaming venue in the Western Sydney golden mile of gaming.

Fairfield’s Cambridge Tavern is believed to have sold for north of $20 million, just surpassing ALH’s sale last year of the Austral Hotel in Mackay for $19 million, and following on from ALG’s sale last month of Bondi’s Tea Gardens Hotel. The investor interest in these blue chip assets was demonstrated by reports the month-long EOI campaign was concluded weeks ahead of time.

 "On behalf of our client we instigated a four week strategic campaign reaching out to both national and international clients, and had a contract for sale exchange shortly after the first week of advertising," relays Ray White's Asia-Pacific region director Andrew Jolliffe.

The rush on the Cambridge is in line with the success of similar hotel assets boasting long-term leases to Coles’ Spirit Hotels and Woolworths’ ALH – as seen in the recent and successful Hotel Property Investments (HPI) IPO out of Redcape’s Coles-leased venues, and ALE’s ongoing success as key landlord for ALH.

"Over the past five years we have been involved in the sale of numerous Woolworth's tenanted hotel assets, and as such have an active client list of purchaser's for same,” said Jolliffe. 

“That said, assets like the Cambridge Tavern are seldom brought to market, so the multiple offers received in the first week of marketing was hardly surprising.

"With options, the Cambridge Tavern owner currently enjoys a lease to ALH (Woolworths) until 2058, and in addition retains ownership of the hotel licence and 30 poker machines."

"Covenants like ALH and Coles provide an element of comfort and certainty to investors wishing to take a position in the hotel landscape."

Source: The Shout - 18 June 2014