A long and hard-fought sales process on the big Kent Hotel has ended in a record price for the Newcastle region of around $25 million, and new owner in growing local vehicle SJH Hotel Fund.
Peter Hunt bought the Kent freehold in 2002, and his son Stephen has long managed it operationally, while simultaneously building his own portfolio and entity.
Hunt senior listed the property in June, recognising consistently increasing interest in the area. Big name publicans such as Arthur Laundy, the O’Haras and Sam Arnaout are amongst those that have ventured north out of Sydney for greener pastures in and around the Hunter Valley.
Beyond shortage of opportunities in Sydney, the transition toward Newcastle has been largely underpinned by major infrastructure development in the region, including the newly international airport.
In September SJH underwent a capital raising, with Steven Hunt reporting major interest by investors, including all existing investors dipping again. The fund now counts over 20 private investors and an appointed Trustee, banking on the established operational expertise of the front-man.
Located in Hamilton, a few kilometres outside the CBD, the multi-level Kent has grown substantially in the past decade, now posting annual revenue of more than $8.4 million through its diverse operations, notably the thriving f&b operation, and gaming offering with 24 machines that is typically Top300 in the State.
Hunt says his existing 17-year tenure gave valuable insight as to where he thinks the operation can go, and suggests the history gives his investors a rare level of certainty through his genuine knowledge of the pub.
“We’re delighted with the acquisition and looking forward to renovating in the new year,” he offered – refreshed from group success at last night’s Awards for Excellence.
While suggesting long-term plans but staying coy on details, Hunt says “refresh, rejuvenate and reinvest” describes the overall approach in mind for the Kent.
“Some of the work’s going to start immediately, the majority of it will fall into Q2 next year.”
The sale campaign through HTL Property’s Andrew Jolliffe and Dan Dragicevich reported multiple big hitters in the bidding, predominantly from Sydney, and offers that local attachment may have made the difference.
“The Kent Hotel was purchased by a group of local investors; meaning the iconic Newcastle property will remain locally owned and operated,” says Dragicevich.
Agents also suggest the combination of operational experience and the right financial backing illustrates a “paradigm shift in hospitality investor outlook” that has certainly contributed to the record-setting prices in the area.
“The Kent Hotel is the 10th Newcastle region hotel our firm has sold in the past 12 months, bringing the total transaction basket value to over $93 million for the region over that time frame,” commented HTL MD Andrew Jolliffe.
