Pelathon doubles Orana Hotel value
By Vanessa Cavasinni, editor Australian Hotelier
Pelathon Management Group has sold Orana Hotel in NSW’s Lake Macquarie region for $4.2 million.
Jaz Mooney and Darren Baker of Pelathon purchased the Orana Hotel a year ago for roughly $2 million from bankruptcy trustee BRI Ferrier, after seeing the pub’s potential to be a good trader. They undertook an extensive renovation to make the pub a more welcoming venue.
“We went in and repositioned it with a renovation, with management. We repositioned it with a bottle shop, food for the family, gaming and a TAB offering – all those things that the community there was calling for,” says Mooney.
Having boosted trade up to between $65,000 and $70,00 a week, Mooney and Baker felt that the venue was more suited to an owner-operator model. With a very active market, they decided it was the right time to sell the regional pub. Daniel Dragicevich and Ben McDonald of CBRE Hotels negotiated the sale to a locally based publican with hotels in regional NSW.
“Pelathon’s ‘no stone unturned’ approach to this project has not only cemented a loyal community following for the hotel but also positions the incoming owners to build on the solid business foundations that have been laid and further capitalise on the property’s high growth, tourism driven location,” stated McDonald.
More growth to come
While other operators are starting to prepare for a market downturn, Mooney suggests that regardless, there will always be deals to be made.
“There is always opportunity out there, whether it be good times or bad times. It’s a case of do you want to go up and down the country finding those opportunities? There will be opportunities in Australia this year, next year and the year after.”
Currently, Pelathon has another pub for sale, the Meadowbrook Hotel – a Top 20 gaming venue in Queensland.
“It’s a huge cash-flow earner. When you invest in the machinery and the gaming room, the environment and the service – it’s a big driver of that cash flow.”
Pelathon is currently interested in northern Queensland for potential investment, having taken over the lease of the Grand Hotel in Cairns with intentions of a full renovation. Mooney is expecting there to be more opportunities as the region continues to grow.
Meanwhile, the Pelathon Pub Fund continues to grow, with three assets currently sitting in the fund – the Victoria Hotel, Wagga Wagga; Mary G’s in Lismore; and the Amaroo Tavern, Moree – with plans to add another three to the fund shortly, including an 81-room hotel in Alice Springs. The additional venues will increase the value of the fund to roughly $50 million.
Pelathon hopes to grow the fund value to $100 million long-term.