Surry Hills cornerstone, the Royal Exhibition, has sold amid hot competition in the city fringe.
The multi-level freehold going concern adjacent to Central Station was divested by private owners Michael Wiggins and Joanne Cassar, as part of plans to finance their purchase of Iris Group’s Oxford Hotel – announced by PubTIC on Friday.
The Sydney Morning Herald revealed on Saturday that Wiggins and Cassar sold the Royal Exhibition for $19 million, following a high-profile campaign that reportedly generated “extraordinary” interest.
Boasting a 24-hour licence and 14 four-star accommodation rooms above two bars, a bistro and a unique 5am licensed beer garden, the hotel epitomises the balanced hospitality business.
JLL national director of pubs, John Musca, told PubTIC they conducted 18 inspections, and received close to 100 enquiries from investors, overseas capital and hotel operators.
“The Royal Exhibition sale drew upon our global reach, with a broad and vigorous buyer response both locally and offshore. This was completely anticipated, when recognising the inherent quality of the underlying property and prominent location in a burgeoning development precinct.”
Musca says that although the cost of capital is at a record low, this is really not what is making the big difference in market activity.
“Ultimately what determines hotel pricing is buyer demand, and therefore key market drivers from the top down and bottom up.
“History shows interest rates have little bearing on yields or values – it’s all about the acquisition strategies of the various private and public capital sources.”
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