Peter Braithwaite has put to market his thriving Brisbane pub The Willow Hotel amid ongoing yield compression in the south-east Queensland marketplace.
Located on a prominent corner block on bustling Beaudesert Road, The Willow is a modern suburban tavern over two levels – ground and lower-ground – offering public sports bar with TAB and efficient single bar operation, family bistro with beer garden-style terrace and indoor children’s play area, gaming lounge with 28 machines, and late liquor and gaming licences.
It also holds the Queensland-specific three detached bottle shop licences, which are currently dormant but may provide further opportunity for an incoming operator.
The pub was originally called the Willow Hotel, but for years was known as the Red Lion until NSW-based Braithwaite purchased it in November 2018 and reverted to the old moniker.
He has invested in its potential and exercised regular strategic CAPEX upgrades, capitalising on the pub’s strong base in F&B and catchment of blue-collar workers.
Moorooka is predicted to be one of the city’s fastest-growing suburbs by property value, due to its proximity to the CBD, and The Willow also enjoys the benefits of minimal local competition.
The historically low cost of debt is seen as one of the driving forces behind a distinct compression of yields taking place in parts of Queensland.
The more typical 10 per cent yield on a freehold going concern is sharpening as purchasers become more bullish, giving way to transactions such as at the Shearer’s Arms, sold to the Maloufs, or Riversdale’s big Elephant Hotel, sold to the Tilley and Wills partnership.
Analysts report seeing capital seeking strong hotel opportunities willing to take returns of 7.5-9.5 per cent.
This bodes well for The Willow, with comparable assets suggesting a sale price north of $15 million.
Hotels in south-east Queensland are historically and continue to be tightly held, rarely going to market, and this sale comes as Braithwaite looks to move on after securing another opportunity.
He has engaged HTL Property to exclusively market The Willow, in Brisbane’s gaming heartland, proximate to high-performers such as the Acacia Ridge, Sunnybank and Calamvale hotels, itself ranked Top200 but with potential.
“The gaming room offers a semi-modern fleet of 28 gaming machines, with identifiable upside through a further room reconfiguration – in addition to capitalising on the seven additional operating authorities already approved for the venue,” notes Glenn Price, managing the sale campaign with colleague Brent McCarthy.
The freehold going concern of the Willow Hotel is being sold via Expressions of Interest, closing Wednesday 5 May.
