CBRE Hotels has been exclusively appointed to sell the freehold going concern interest in the North Nowra Tavern amid continued strong interest in the NSW coastal hotel market.
Ben McDonald and Daniel Dragicevich will steer the Expressions of Interest campaign for the large format tavern on behalf of a syndicate of Brisbane based investors.
Located in the picturesque Shoalhaven region, approximately 160km south of Sydney, the hotel offers incoming purchasers the ability to secure a high cash flow operation which generates over $140,000 per week in total sales.
There is considerable future upside, including untapped SIA gaming approval limits and two further stages of an approved DA with substantial commencement.
The 6,019sqm hotel site is adjacent to the North Nowra retail centre and caters to a growing number of local residents, driven primarily by council land releases and residential subdivision projects.
CBRE Hotels’ National Director Daniel Dragicevich said the sale coincided with continued demand for high cash flow assets of the scale of North Nowra Tavern and predicted that this would be the basis for the hotel transaction wave in a market that has seen record pricing and cap rate compression over the past 18 months.
Mr Dragicevich noted; “The search for assets displaying the core trading attributes of the North Nowra Tavern is usually long and often fruitless. Strong market conditions reveal opportunities rarely seen for sale and we believe this hotel is one of those opportunities.”
Overseeing the hotel operation from his office in Brisbane, Michael Lucas said the syndicate owners had decided now was the right time to part ways with the asset, which they acquired approximately three years ago.
“We have delivered stage one of our proposed plan and pushed the hotel to a point that we feel is right for us to exit. Whilst we firmly believe in the continued growth of the business and the area, we have syndicate members at varying stages of their journey which we need to respect and the best way to do that in this case is via divestment,” Mr Lucas said.
CBRE Hotels’ Manager Ben McDonald said the hotel’s large trading footprint, robust performance and opportunity to grow the business considerably in the short term would underpin keen market interest in the asset.
Mr McDonald said; “This sale presents a genuine opportunity for hoteliers and commercial property investors to secure a hotel at a 30-40% discount to what hoteliers might expect to pay in metropolitan Sydney for the same cash flow and EBITDA performance.”
The national Expressions of Interest campaign is scheduled to close on Wednesday 23rd August 2017.
For Australian/international news or global stories, follow us on Twitter: @cbreaustralia
About CBRE Group, Inc.
CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue). The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through more than 450 offices (excluding affiliates) worldwide. CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services. Please visit our website at www.cbre.com.