IMG Hotels continues to invest in its powerhouse regional collection, buying another pub in Bathurst, the popular Paddy’s Hotel in Kelso.
Paddy’s is a suburban tavern on a large 9,500sqm plot, with an expansive trading footprint and latent capacity for times of demand. It holds a late-trading 2am licence (Monday to Saturday) and new gaming room sporting 21 GMEs and a strong upward growth trajectory.
The new owners say they aren’t looking at any particular changes and simply want to focus on delivering the full potential of the pub to the local market.
“It’s a fantastic footprint already,” says Andrew Turnbull, principal of IMG, praising the long tenure of the unnamed vendor.
“We have no short-term plans other than like at all the assets in our portfolio, where our goal is to invest to maximise opportunities, primarily around f&b.”
Already holding The Dudley at the opposite end of Bathurst, the group hope to benefit from the synergies of two venues in the area, Turnbull suggesting they will be looking to provide “complementary offerings”.
IMG is understood to have paid circa $21 million for the freehold going concern of Paddy’s, in the strong regional centre of Kelso, an eastern precinct of Bathurst around 200 kilometres west of Sydney.
The hotel enjoys a large surrounding population catchment, emanating from Kelso, White Rock and Raglans, with the only other licensed competition being the Kelso Hotel, owned by Ashton Waugh’s Watering Hole Hotels.
IMG burst into the pub game with the big-ticket portfolio purchase of MPK Hotels’ NSW pubs for around $75 million in early 2021, picking up the Royal at Orange, Dudley at Bathurst, Castlereagh at Dubbo, and the Federal hotels at Wellington and Mudgee.
Later that year IMG completed its MPK acquisition with purchase of the restapled freehold going concern of Dubbo’s Western Star for around $7 million.
But earlier this year they topped those transactions, nearly doubling the portfolio with purchase of five venues from the multi-generational Tamworth Pub Group for $160 million, adding Tamworth party pub the Longyard Hotel, sports venue the Southgate Inn, the all-ages Family Hotel, Brittan’s Brewery, and local gem The Pub – “where everyone’s welcome”.
The buyers disclosed they plan to activate approved DAs on the venues and capitalise on evolution in the region.
Canberra-based Investment Management Group Hotels is led by former PWC managing partner Andrew Turnbull and CEO Matthew Clowry, bringing experience in financial services, fund management, property development and hospitality, and a strategy to capitalise on robust markets in the NSW central west.
Turnbull praised development activity in Kelso, which will soon include construction of 89 seniors living dwellings adjacent to Paddy’s.
He says pubs are “almost counter-cyclical” in terms of their sustained appeal to people even when times are tough, and their dogged support of and links with locals.
“The pub’s an integral part of the community, but still an affordable outlet for socialising.
“It is difficult, I suppose – with inflation and increasing costs – we are quite restricted in passing costs on to clients, but if you provide a great service and great venue there’s a strong opportunity to maintain business even in hard times.”
IMG now hold 14 pubs, across western epicentres Dubbo, Orange, Tamworth and the “fantastic town” of Bathurst, which Turnbull says are all “very strong regional cities not dependent on one industry” and thus better able to weather downturns in any one sector.
The off-market sale of Paddy’s Hotel was conducted by HTL Property’s Blake Edwards and Xavier Plunkett, who were unable to comment on the transaction.
