There’s a new rising star of the region as Jim Knox divests his big Area Hotel in Griffith to a local operator.
Knox bought the pub in 2019 for around $8 million from a private syndicate who had operated it under management.
Griffith was where the family first got into the hotel industry, complementing its other businesses. The Area joined a growing portfolio counting the Griffith and Gemini hotels, bought in 2014.
Residing on a 1,291sqm site in the main commercial and retail precinct, the two-storey red brick pub features a public bar, TAB, commercial kitchen and bistro, gaming room with 30 machines, 15 pub-style accommodation rooms and a two-bedroom manager’s residence, beer garden, and 3am liquor licence.
The Knoxes curated the operation to lift trade, improving the gaming ranking from #367 to #219, but this sale purposefully follows their divestment of the Griffith.
“The Griffith region has been very good to us, in our hotels business especially, but also our agriculture and engineering-related enterprises,” offered Knox.
“However, it poses geographical challenges for our key personnel, and in the medium term we are looking to consolidate our holdings closer to our head office, in the New England Region.”
The group retains the upmarket ‘Gem’ Hotel, boasting 65 4-star hotel rooms, Top250 gaming room, and a renowned steakhouse that has featured in a list of the Top100 in the world.
Griffith is a thriving regional centre with only two pubs in a town zoned red, meaning no more can be opened and the incoming purchaser will benefit from the lack of competition.
Sources close to the deal say the new owner has paid $30 million for the freehold going concern, representing nearly three-hundred per cent uplift on the purchase price, and making it the largest regional sale of FY24.
The transaction was through Xavier Plunkett from HTL Property, which also managed the sale to Knox, in conjunction with Nick Tinning of Chris Tinning & Co. Agents would not reveal the identity of the buyer, only offering that the person is “a highly regarded private investor with local connections”.
“Griffith enjoys some of the most desirable hotel fundamentals of any regional centre; full employment, well above average incomes, enormous itinerant worker base, and a favourable ratio of one pub per 7,000 residents,” says Plunkett. “And government regulatory restrictions on any further pub competition.”
The sale is thought to be the largest pub transaction in the wider Riverina district, topping Harvest’s purchase of the Victoria Hotel in Wagga Wagga for $29 million.
It is a clear vote of confidence in the state’s regional market, and HTL principal Andrew Jolliffe says it’s their considered view that sophisticated investors will prioritize the asset class when comparing to other commercial property opportunities.
