The Zagame family is a step closer to quitting the pub sector, selling the Boronia Hotel freehold.
The deal, to an as yet undisclosed Brisbane based new entrant, is worth $24 million, reflecting a five per cent net yield.
It was sealed within 48 hours after the close of an expressions of interest campaign.
JLL’s John Musca, Will Connolly and Stuart Taylor with Cropley Commercial’s Steve Cropley and George Illopulos were the agents.
On 7053 square metres at 112 Boronia Road, on the south east corner of Dorset, the venue, until recently known as Zagame’s Boronia, includes 80 electronic gambling machines.
Its sale comes three months since the Zagame family banked $99m selling its leasehold, and that of three other properties – Berwick Springs, Golden Point Hotel (Ballarat) and Edwardes Lake Hotel (Reservoir) – to the Francis family’s IPR Hotels (story continues below).
Last month, the vendor reaped $28m offloading the Reservoir freehold to ASX-listed Hotel Property Investments.
“The sale highlights the esteem investors hold in hotels as an asset class, delivering an Internal Rate of Return exceeding any other form of retail property due to the millions of dollars of underlying perpetual goodwill value that exists in each tenancy [and] the future restabling arbitrage,” Mr Musca said following the Boronia deal.
Private investors and institutions looked in, he added.
“The level of momentum the hotel market is experiencing is quite extraordinary, with the sector now sitting deservedly alongside traditional retail investment assets,” according to Mr Connolly.
More to come.
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