Riversdale has ended speculation of a complete sell-down with the purchase of the Lambton Park Hotel in suburban Newcastle.
The pub was bought around three years’ ago by a partnership of three newcomers to the industry, who went on to also buy Sydney’s Haymarket Hotel.
The trio put the Lambton Park – locally known as the LPH – to market in February, citing plans to concentrate on the Haymarket.
“it’s been a great first hotel for us and still has plenty of potential, [but] we’re looking at focusing on our Sydney operation at present,” said co-owner Dan Turner.
An EOI campaign on the freehold going concern through Ray White Hotels’ Blake Edwards and Dean Moore of Moore & Moore Real Estate expected big player interest in the asset. The most recent sales in the region – the Hotel Delany and Sunnyside Hotel – were both to Sydney buyers.
The 1,038sqm site on Lambton’s Morehead Street originally housed the Eli Chadwick Hotel, built in 1881, before Tooth & Co purchased it and built the current two-storey brick structure in 1929.
It offers a main bar with single person operation, bistro, spacious patio and purpose-built gaming room with 15 EGMs at the rear, off the carpark.
Beyond better use of the outdoor areas, the business holds major potential through reactivation of the eight accommodation rooms upstairs, with their own kitchen, dining room and amenities.
Lambton is part of the wider City of Newcastle, of around 161,000 residents. Local catchment is just over 5,000 residents, who according to Census 2016, are disproportionately represented by high-earning professionals.
The pub is located on a busy intersection with high visibility, and reports average weekly income of just over $61k.
Furthermore, there are only three other Hotels in the precinct – two of which will soon close, removing 16 EGMs from the area.
Cashed up from the strategic sell-down of most of its portfolio, beginning with the Peakhurst Inn, Bristol Arms, and Como Hotels late 2016, then the Toxteth in February 2017, the Marlborough in April, and Kinsellas in May, the pub group representing high-flyers John Singleton, Mark Carnegie and Geoff Dixon may be building again.
The backers’ Australian Pub Fund (APF) was originally a $300 million purse for the acquisition of any number of suitable investments, first under the vocal guidance of Patrick Coughlan, then the steady hand of former Solotel CEO Andrew Gibbs.
APF sought to acquire the worst pubs in the best areas, with the intention of injecting capital and operational prowess to build on their values. Sources report the LPH has sold for around $6 million, in what is arguably one of the hottest areas in Australian pub sales at the moment.
Deane Moore reported an “unusually large” number of enquiries, which he puts down to the Hotel’s solid fundamentals and the well-established low levels of available stock in the current market.
“This sale represents another Newcastle hotel being sold to a Sydney-based investor,” furthers Edwards.
“These buyers are continuing to perceive excellent value in strong regional centres outside major metropolitan cities, and have the appetite and funds to complete the purchase.”
Andrew Gibbs did not reply to request for comment prior to publication.