Following an international EOI campaign, the Padstow Park Hotel has sold under the hammer to incumbent operators JDA Hotels.
The Padstow was purchased in 2014 by White & Partners for $13.7 million from Coles’ Spirit Hotels, with John Feros’ JDA Hotels to operate it, holding a ‘skin in the game’ minor equity share.
Coming to market late February, just two months after being granted extension to 2am trading, Feros noted having “spent considerably in terms of cap-ex” in preparation of the approval for later trading, citing strong patron numbers at midnight in the pub, located close to Padstow station.
Today it went to public auction before a crowded room of usual suspects, gathering multiple bids from several parties before stalling at $25.8 million, which the auctioneer conceded was short of reserve.
A quick negotiation with the vendors brought announcement the pub would be on the market for a bid of $26 million, which sources say represents a return approaching 8.5 per cent.
The news saw a representative for JDA Hotels enter the bidding and meet the mark.
The other bidders were ultimately reluctant to go higher, and JDA secured the remaining equity in the Hotel, still set to benefit from the upsides of recent spend and the extended hours.
“We clearly know the hotel, and have a good appreciation of the area; having operated hotels in that part of Sydney for decades,” said Feros.
“We are active buyers in the market, and will continue to seek and transact upon well-located opportunities where we see we can add value.”
The auction took place at the offices of Ray White, the campaign fronted by Asia-Pacific director Andrew Jolliffe, who was buoyant on the significance of the sale.
“Nationally, this industry is better funded, guided and operated than at any other time in its long history, lending itself to continued market strength and investment grade longevity.”