The Town & Country Pubs group is packing up its two remaining pubs, listing its coastal Queens and Tandara Hotels.
Queensland-based Town & Country (T&C) is one part of a wider entity that is looking to build a portfolio of capital city pubs, and recognises it doesn’t have the resources to accommodate regional locals.
The Queens Hotel occupies 3,854 m² on the corner of Goondoon and Williams Streets, Gladstone, a town of around 50,000, about five-hundred kilometres north of Brisbane.
It comprises a public bar, dining facility, function space, gaming room with 23 EGMs, and 27 motel-style accommodation rooms and while the pub used to thrive, selling the likes of $75 steaks to FIFO (Fly In Fly Out) workers, the area has been hit hard by the downturn in the mining sector and it has suffered accordingly.
The Tandara Hotel, about four hours north in Sarina, has proven a
very consistent trader courtesy of a similarly diverse mix of revenue, with a public bar, bistro, gaming room with 31 EGMs, beer garden and 15 motel-style rooms.
Town & Country has been selling down its portfolio, parting with the Royal Hotel Toowoomba in February, 2016, the Starlight Tavern in Longreach last October, and the Criterion in Dalby just this month.
Around 14 months ago the group invested “significant capital” into both pubs, executing minor refurbishments to the accommodation, dining and gaming facilities, and new machines.
“They’re making better money than they were a year ago,” offers Hans Borgelt, representing T&C.
“But we want to focus more on our core business.”
Both pubs are being marketed by CBRE Queensland’s Paul Fraser and Glenn Price, who suggests the downturn has swung, but will most certainly rise again.
“Resource-centric areas have been hit hard the last couple of years, but they always come back. The Queens now is at a considerable discount to what you would have paid a few years ago,” Fraser told PubTIC.
“At the same time, the strong underlying intrinsic value in land property and gaming authorities presents as a very compelling surety in a market that has had more than its fair share of head winds.
“We envisage that the market will attribute strong value to these assets given their high cash flow potential and undoubtable countercyclical buying.”
Gladstone is home to Queensland’s largest multi-commodity shipping port, and has been a major hub during the resources boom. Far from defunct, it is currently seeing major infrastructure projects and planning by Southern Oil, Casper Oil, and Queensland Energy Resources with the potential to revitalise the area’s economy.
“We are already seeing astute buyers looking back into these markets as an opportunity to create strong cash flow businesses over the short- to medium-term, and wait for the economy to fire again,” reports Fraser.
The Queens and Tandara Hotels are for sale via Expressions of Interest, closing Wednesday, 12 April.