MELBOURNE, 14 September 2021: The Freehold interest of Edwardes Lake Hotel in Reservoir has been sold for $28 million within 24 hours closure of EOI, demonstrating again that appetite nationally for large scale investment hotels remains insatiable. The property was offered exclusively for sale via JLL’s John Musca, Will Connolly and Stuart Taylor in conjunction with Steve Cropley and George Iliopulos of Cropley Commercial.
John Musca, JLL Hotels National Director, commented that the sale “highlights the astute market recognition of investment hotels as an asset class that delivers an IRR exceeding any other form of retail property due to the millions of dollars of underlying perpetual goodwill value that exist in each tenancy, so the future restabling arbitrage and value uplift is incomparable.”
Presented to market via a national ‘Expressions of Interest’ process, the property gained interest from both private and institutional investors with offers received from parties nationally. The successful purchasers, Hotel Property Investments (ASX:HPI), trumped the shortlisting process with an unconditional bid and a very short settlement term.
Edwardes Lake Hotel, previously known as Zagame’s Reservoir, was offered with a sought-after investment grade, 60-year, triple net lease with the venue operating 100 gaming machines and a commencing net annual income of $1,400,000. In addition, the attractive 48,900sqm site area provided an underlying long term land-banking platform.
Will Connolly, Vice President, JLL Hotels commented, “the hotel industry is currently experiencing the strongest period of transactional activity in two decades and the fact that this sale was executed less than 24 hours after EOI closing is testament to the feverish desire for freehold pub assets across the country”.
Congratulating the successful purchasers on their latest acquisition, George Illiopolus, Director Cropley Commercial concluded “it was a pleasure assisting HPI in securing the latest addition to their national portfolio on what is undoubtedly a quality asset with an impressive tenancy covenant”.