HPI agrees three separate hotel deals
Hotel Property Investments (HPI) has entered into agreements to acquire three hotel properties for a combined $63.3M across both Queensland and Victoria.
The three properties, Queensland’s Mango Hill Tavern & First Choice Liquor, along with both and The Jubilee Tavern in Airlie Beach as well as the Summerhill Hotel in Metropolitan Melbourne, represent a weighted average capitalisation rate of 6.40 per cent for the fund.
The Mango Hill deal was brokered by Cushman & Wakefield’s Nick Spiro, the Jubliee Tavern by HTL Property’s Glenn Price and Brent McCarthy, and the Summerhill Hotel by CBRE’s Scott Callow. The three deals take HPI’s impressive hotel portfolio to 48 pubs nationally.
HPI’s Chief Executive Officer, Don Smith, said: “The acquisitions represent the continuation of HPI’s strategy of acquiring high quality properties in attractive markets which are leased to quality operators on long lease terms.”
The Jubilee Tavern is located just 2.5kms from Airlie Beach and is home to 45 gaming machines, public and sports bars with large bistro, drive-thru bottle shop and an impressive children’s play area on a 6,750sqm allotment.
HTL Property Director, Price, said: “HPI have again identified quality assets with leases to long term corporate and private hotel operators underpinned by strong land values and business fundamentals. Their forward thinking within the sector bodes well for shareholders and future investors.”
McCarthy, added: “With HPI’s strategic direction now patently clear, it provides generational hoteliers the opportunity to free-up their balance sheet for further acquisitions and a realignment of their business models, with a landlord who is there to work with its tenants on a long term basis.”
Located on Brisbane’s northside the Mango Hill Tavern encompasses a large format tavern operation, First Choice Liquor Barn, service station and specialty tenancies. The site was purchased for $31.3M reflecting an initial yield of 5.65 per cent and a combined WALE of 6.6 years.
The Summerhill Hotel in Melbourne’s North was also acquired for $22.7M.
The two Queensland assets are expected to settle by the end of this year, and it is understood the Melbourne asset will settle Q1 2021.