Two years after renting Justin Small the Botany View Hotel at Newtown, Paddy Coughlan has sold him it.
The deal is speculated to be worth well over $6 million.
The vendor spent $6.4m four years ago.
In early 2019 Mr Coughlan, an ex-publican, tried to offload the property at 597 King Street as a freehold going concern before changing plan (and agent) and renting it to Mr Small’s Small Pubs, which ran the Balmain Hotel.
Kate MacDonald and Ben McDonald, who brokered the Botany View lease, also managed its sale.
Newtown is about four kilometres south of Sydney.
Sydney inner-city hotels selling like hotcakes
On Wednesday we reported the Pasfield family sold Woolloomooloo’s Old Fitzroy Hotel for $6.85m to investors which plan to lock in a long-term lease with theatre occupier Red Line Productions.
Two days earlier, Adella Wright-Young offloaded Alexandria’s Camelia Grove Hotel after 38 years.
That deal, worth $13.75m, was with Jon Adgemis’ Java Group.
Late last year Moelis spent $67m on neighbouring Darlinghurst pubs with plans to redevelop the holding.
In that suburb, too, Goodtime Hospitality sold the East Village Hotel for a speculated price of more than $7m while St Vincent’s Hospital outlaid what is speculated to be a similar sum for the Green Park Hotel at 360 Elizabeth St.
Also in inner-Sydney last quarter John Azar’s The Good Beer Co divested of Randwick’s Duke of Gloucester for $32m and Paddington’s Four in Hand ($8.25m).
Coincidentally Mr Coughlan once owned the leasehold to the Four in Hand and Kinselas – one of the assets Moelis recently picked up (story continues below).
In leasehold circles at the end of last year:
- Hospitality newcomers Mattew Younger and Kaine Costello purchased Rozelle’s Native Rose Hotel; Fethers and Maystrovich was the vendor, and
- Newcastle publican Wayne Lambert acquired Paddington’s Olympic Hotel.
Botany View Hotel sold “the precise way we had hoped”: agents
Also known as the BVH, the Newtown pub at the north west corner Darley St, contains two trading floors configured with bars, a dining room and kitchen.
There is also a bottle shop and rooftop garden; all up 708 square metres of lettable area.
The beer garden is licensed until 2am and it has 12 electronic gambling machines.
Mr Coughlan acquired the asset from the Murphy family which held it for nearly three decades.
Mr Small was on a 10 year lease which, with options, he could have extended until 2039.
“Following an unsuccessful freehold going concern sale with another Sydney hotel brokerage agency…JLL Hotels was approached to present a bespoke divestment strategy tailored for the specific needs of the vendor – the culmination of which is the sale of the freehold investment reflecting a bullish sub five per cent initial yield,” Ms MacDonald said.
“This particular off-market transaction has played out in the precise way we had hoped and in a shorter time frame than expected,” the agent added.
“Our aim was to deliver an outcome in line with our vendors goals which meant maintaining flexibility in the transaction process whilst maximising the overall exit price”.
Securing pub was final piece of the puzzle: occupier
Mr Small said that despite the federal government lockdown, Small Pubs has enjoyed its tenancy but he is excited and relieved to have purchased the real estate.
“This has always been the final piece of the puzzle,” he added of the buy.