The Laundy family has brushed up the portfolio with sale of the big Swansea Hotel, sold in a second deal with the growing family-run Hunter Hotels.
“We plan to be active in this environment both in terms of reviewing opportunities to buy and sell assets,” offered group patriarch Arthur Laundy A.O.
“Sitting still at this point in time isn’t an option for us, and arguably shouldn’t be for anyone else.”
The large-format Swansea Hotel sits in the heart of Lake Macquarie’s retail precinct on a 3,235sqm site. It provides a strong bistro operation, TAB and Keno, gaming room with 30 EGMs and 10 accommodation rooms upstairs. It also enjoys the benefits of around 50 off-street car spaces and 24-hour trading approval.
The Laundy family took the title in 2016 from the Bernie family for $13 million. Partner Justine Laundy, Arthur’s daughter, steered a significant reconfiguration and renovation program repurposing part of the building that had historically been leased to a third party, increasing the trading footprint and realising a marked uptick in trading performance and overall asset value.
A second DA remains to extend the beer garden and construct a large kids’ play area at the rear.
Justine and husband Nick Tindall, GM of Laundy Hotels, were eager to realise the capital growth and reinvest in future ventures with the pub king, looking to “more opportunities” in sub-ten million-dollar assets.
Despite the pub’s historically strong cashflow, the group determined it a better option to divest and leave potential for an incoming operator.
This sale represents the second transaction between the two groups, coming three years after the Hunters bought the Bateau Bay Hotel from the Laundys in mid-2017.
“We’ve found doing business with them reliable and easy and honest,” says Tindall. “They’re well-established on the coast and the best people to take Swansea to the next level.”
Swansea brings the Hunter stable of hotels to nine. What might be the new flagship venue joins its north coast collection, including Finnegans Hotel in Newcastle and the Kincumber Hotel, bought late 2019.
The price paid for Swansea sees a sharp cap-rate for a coastal asset, honed by the relative lack of comparable operations.
The off-market sales process was steered by HTL Property’s Dan Dragicevich and Blake Edwards, who note the sale also shows the post-COVID rebound being seen in A-grade hotel real estate.
“We remain encouraged by the buoyancy regarding market activity over recent months, and the pronounced snap-back in positive market sentiment has only served to underline a resiliency and attractiveness for pubs being highly credible investment-grade assets,” says Dragicevich.
HTL hinted at a number of “national public campaigns” said to be coming before year end, citing “great confidence regarding market depth and capacity”.
