Hunt Hospitality has sent to market another large-format pub operation, offering the oceanside Seabreeze Hotel, in the heart of idyllic Nelson Bay.
The windswept pub is on a commanding 3,180sqm corner with dual-frontage, just 200 metres from the Bay and Marina.
It spans the full suite of departments, counting a large public bar and modern bistro, gaming room with 18 machines (Band 2 entitlements), function space, beer garden, 18 hotel accommodation rooms and a drive-through bottleshop.
Recent major renovations have invested in the function area, outdoor area and gaming lounge, and annualised revenue is reported at around $6.2 million, with a modest 22 per cent derived from gaming.
Stephen Hunt’s investor-backed outfit makes a practise of buying with potential and recycling the capital when the time is right.
Hunt says when considering an asset they employ a multi-factor model developed over decades, requiring a good mix of trade and locations with stable economies and strong population growth. Once part of the stable, his team considers where capex is required and sets about growing the pub’s strengths.
To date focus has been on the east coast, but Hunt says he is looking at several other assets in Australia and is currently in Europe with a business partner, eyeing potential Hunt Hospitality International acquisitions in Ireland.
Previous recycling out of assets saw successes in sale of the Rutherford in 2018, and the Lakeside Hotel in 2019.
“The market is strong right now,” Hunt says.
“We look at market conditions, and when the timing is right we go to market. We then redeploy capital to spend on capex or purchase another asset.
“In effect, we are always looking to grow the fund.”
The Seabreeze is being offered with favourable terms on the 18 years remaining on the lease, and blue sky potential, potentially through greater use of its bay-side vista (STCA).
It comes to market through HTL Property’s Dan Dragicevich, Xavier Plunkett and Andrew Jolliffe, offering a significant coastal opportunity in a prime tourism location that includes both scale and diversification.
An Expressions of Interest campaign closes Thursday, 24 October.
“This is an extremely well-rounded asset with strong cash flows across every department, a robust gaming platform, and significant operational upside for experienced operators,” suggests Plunkett.
As the epicentre of the Port Stephens LGA, Nelson Bay is one of NSW’s most sought-after coastal growth corridors, and underpinned by a robust local economy and more than 1.5 million annual visitors it has seen substantial growth in recent years, propelled by increasing resident and transient population and rising property values.
The population of the Port Stephens LGA is projected to grow nearly 20 per cent in the next 15 years, to more than 93K people.
Displaying an “ideal blend of high-margin earnings and blue-chip location”, Jolliffe believes the Seabreeze to be one of the most compelling coastal hotel opportunities HTL has seen in a while.
“A-grade leasehold venues such as the Seabreeze have returned to favour in recent years given the proud cashflow benefits on offer to established portfolio owners.”
