Mere days after the announcement Redcape was divesting two of its collection in north Queensland, a sale has already been confirmed on one, Mackay’s The Grove.
Last week the high-profile group listed The Shamrock and The Grove hotels in Mackay, with anticipated collective sale price of more than $50 million. It’s understood it is looking to bolster the balance sheet as it strives to overcome hurdles in its operational and gaming landscape.
Previously known as the Andergrove Tavern, the large-format The Grove occupies a 1.96-ha site incorporating public bar, bistro, gaming room with 45 EGMs, drive-through bottleshop and function spaces, generating weekly revenue circa $200k.
Both pubs are high performers, The Shamrock ranked #76 and The Grove #94 in the state, and the reported depth and breadth of interest in the assets was “not inconsistent” with agent expectations. In July a NSW syndicate headed by Sean O’Hara purchased the Gracemere Hotel in Rockhampton for $22 million.
Transactions in the Sunshine State can be systemically long-winded, but Sydney-based stakeholders are said to have driven the agreement in what is an impressively short time frame, with the accordant applications not even on the OLGR website yet.
Agents would not disclose the identity of the buyer nor the price paid, although they did confirm the sale price was in line with market guidance.
“We wholly anticipated there would be strong interest in the two hotels brought to market, and the successful purchaser has been rewarded for its confident approach to the opportunity the public sale process has presented,” said HTL Property’s Andrew Jolliffe. The sale campaign was conducted by HTL in conjunction with JLL Hotels’ Tom Gleeson.
The formerly listed pub group owns and operates a collection of 35 hotels worth more than $1.4 billion, generating revenue in FY23 of $384 million, achieving EBITDA of $78 million. Thirty-nine per cent of it is owned by MA Financial (former Moelis Australia), which steered Redcape off the ASX late 2021 based on hopes for higher valuations for the gaming-heavy portfolio outside public scrutiny.
But in July the company froze investor redemptions, citing “deteriorating consumer confidence” and volatility in the venues’ performances. On the sales, group MD Chris Unger pointed to their history of “[recycling] capital through successful divestments”.
Facing this and other unwanted publicity, MA is thought to have been looking for some positive PR and helped fast-track a deal.
Around 10 kilometres south of The Grove, Redcape’s The Shamrock remains on the market through EOI, set on 11,442sqm and reporting weekly revenue of more than $320k across bar, bistro, 40 gaming machines, accommodation and retail.
