Kent Walker has put suburban stalwart the Earlwood Hotel to market, in a rare divestment of a Top200 Sydney pub.
Built 1931, the three-storey brick Hotel was designed in the Interwar style, occupying an 825sqm lot with overall floorspace of 1,643sqm. It is situated in the centre of the Earlwood precinct, south-east of Marrickville.
Recently refurbished throughout, it holds a 24-hour liquor licence and provides patrons a modern public bar with TAB and big TVs, gaming room, a courtyard beer garden, bottleshop and 21 accommodation rooms upstairs.
The Canterbury-Bankstown LGA is one of the state’s most lucrative gaming LGAs, with 31 out of 33 hotels ranked in the Top250, making it home to many of the largest gaming operators in NSW, including Endeavour Group (former ALH), Iris Capital, Redcape, Thomas Hotels, Lewis Hotels and Oscars Hotels.
Earlwood Hotel includes 29 gaming machines, being 19 entitlements and 10 permits, all in smoking solution with TITO, CRT and modern hardware. It is subject to a 3-hour weekend gaming shutdown, and has midnight trading approval on Sundays.
It has found an average ranking of #152 on the Liquor & Gaming list of NSW pubs over the last three years, and being in a Green Zone (SA2) has scope to add an additional permit, to reach full complement.
Earlwood is itself a one-pub suburb, but also virtually surrounded by suburbs with no pub, such as Bardwell Valley, Bardwell Park, Clemton Park and Turella, giving the Hotel a wide trading catchment amid limited competition.
The Canterbury-Bankstown Masterplan is looking to “intensification” of the built environment of Canterbury-Bankstown City (CBCity), bringing upgraded town centres, high-rises along a new metro line and 24-hour commercial hubs.
Marketing literature for the Hotel notes stable and secure revenue across mixed departments of almost $130k per week (annualised for FY22).
Inner west precincts such as Earlwood only continue to grow in density, meaning there is considerable potential in the underused accommodation and in f&b, which currently contribute less than 20 per cent of total revenue. The bistro is leased to an outside operator.
Vendor at The Earlwood is Kent Walker’s Lesday, which boasts a portfolio of ten other hotels.
Sources suggest it is likely to see sale price of around $45 million. The most recent 10 high-ranking gaming pubs, transacted over the past 18 months, sold at an average yield of 5.77 per cent.
“The Earlwood Hotel represents an extremely rare Top200 gaming acquisition opportunity within the Canterbury-Bankstown LGA,” says HTL Property’s Dan Dragicevich, marketing the sale with colleagues Andrew Jolliffe and Sam Handy.
“A one-pub suburb, the Hotel effectively enjoys an exclusive trading catchment, the optimum late night trading privileges and upside across each department realisable via strategically applied capex.”
The Earlwood Hotel is to be sold via Expressions of Interest, closing Tuesday, 12 April.
