Ashton Waugh has placed a strategic bet on Sydney’s transforming Kings Cross with purchase of the re-stapled freehold going concern of the New Hampton Hotel.
Leaseholder Kieran Coleman listed the business interest in the Hotel last October. Located on Bayswater Road, near the famous Coke sign and Kings Cross train station, the New Hampton is under the stately Hampton apartments.
Waugh began looking at the opportunity in November, and after negotiating with freehold owners Toga Group, an agreement was struck with Toga and Coleman as vendors for the combined asset, landing the FGC with 18 gaming entitlements, a 3am liquor licence and several vacant retail tenancies.
Significantly, the moves to purchase began before the precinct’s notorious ‘lockout’ laws were finally relinquished, in January of this year.
“I think Kings Cross has been through its low ebb and hardship, and the next five to ten years will be good for the area,” offers Waugh.
The Hotel only occupies around 30 per cent of the floorspace of the freehold, which spans two floors, and the plan is to get the vacant sites tenanted with restaurants and retail, and possibly expand the hotel’s footprint to incorporate a cocktail bar or function space. A restaurant lease has already been secured in one space, hoping to open by end of year.
Waugh says he has plans for the New Hampton, but will not be going hard on foodservice and compete with his own tenants.
“We need to bring back the people and the vibrancy, but it’s going to come back as a thriving village – with a better level of late-night trade.
“That’s where I think the Cross is going and why I had confidence in this.”
The sale was managed by HTL Property’s Blake Edwards and Dan Dragicevich, who note the increased level of interest shown in the area by astute purchasers, but also the arbitrage opportunity in re-stapling OpCo/PropCo assets.
“The respective premiums achieved by both tenant and landlord on the sell side of our Kings Cross transaction reflect that theory, and we are currently in discussions with other landlords and tenants about re-coupling their respective assets,” says Edwards.
