ASX-listed Redcape Hotel Group has acquired the freehold going concern of the Gladstone Hotel Dulwich Hill in one of the largest transactions of 2020.
Redcape (ASX:RDC) advises it has exchanged contracts to acquire the Gladstone Hotel, which it says will complement its portfolio of “suburban community hotels in high growth areas” – predominantly in western Sydney.
The ‘Gladdy’ joins the collection for $38 million and is expected to be accretive to Distributable Earnings for shareholders.
Sale included the Little Bottler bottleshop across the road and adjacent Local Liquor Superstore, the combined properties totalling 1300sqm.
For the past 43 years it has been owned and operated by the Coote family, custodians Craig and Loretta Coote deciding the moment and opportunity were right to step down, after many years behind the wheel.
RDC has already flagged a major refurbishment program and suggests the pub will benefit from its operational platform and capabilities in capex. The Gladstone has slipped a little in gaming performance in recent years, finding itself at #224 on the Liquor & Gaming list of NSW venues after averaging around #150 and a high of #135 in late 2018.
Redcape CEO Dan Brady offers that this latest acquisition represents a certain ‘business as usual’.
“Being our first acquisition since returning to full operation and with distributions reinstated, the purchase signifies a return to our strategy of active portfolio optimisation and growing sustainable distributions for our Securityholders over the long term.
“We look forward to immersing ourselves in the Dulwich Hill community and learning about the Gladstone Hotel’s customers and staff as we look to drive even better outcomes for our staff, our customers and our Securityholders.”
RDC stated the purchase will be funded from existing resources, with settlement anticipated before March 2021.
RDC shares closed today at $0.99, down from a recent high of $1.06 in early November.
