Top Sydney Gaming Hotel to be Auctioned
Following a flurry of significant freehold hotel sales, including well known Sydney properties The Colombian Hotel and The Commodore Hotel, Ray White Hotels Asia Pacific Director Andrew Jolliffe has now listed Top 100 gaming property The Tennyson Hotel on Botany Rd in Mascot.
The Tennyson Hotel is a multi-level and very popular hotel with 30 gaming machines, and notwithstanding the latest ranking at 87 in the State of NSW, the hotel requires an upgrade, and leading hotel architect Paul Kelly has designed a renovation which has recently enjoyed D.A. approval. “Only a very small number of Top 100 gaming hotels have changed hands over the past few years, such is the vice-like grip the ever diminishing number of consolidating ownership bodies hold on this particular asset class”. “In fact we sold the last one only a few weeks ago, and the competition for that particular property was both active and well defined” commented Jolliffe.
Yet Jolliffe insists the Tennyson Hotel is more than just a Top 100 gaming hotel. “Firstly, the reality is that this should be a Top 50 Gaming hotel without too much controversy; how far into the Top 50 this hotel could go is the better question” “However in addition the Tennyson Hotel sale prescribes an opportunity to acquire a business operating accommodation, bars, food and a drive through bottle shop. A further compelling feature is the size of the land holding, and the potential for further development in a corridor of Sydney which is experiencing approx $1bn worth of material development projects including Crown Group’s 500m redevelopment of Eastlakes Shopping Centre, and Mirvac’s $250m Mascot Central mixed use precinct” advised Jolliffe.
The two-level large format hotel, the bones of which are illustrative of a Sidney Warden designed Inter-War Functionalist structure, is situated prominently on the busy Botany Road and High St corner allotment atop a very valuable 1400sqm. Jolliffe’s client, JDA Hotels, is said to have recently contemplated an unsolicited offer from an astute purchaser, however the considered view was to bring to the market, very publicly in the form of an auction, the rare hotel opportunity. “In addition to the unsolicited offer we received, a significant national serviced apartment operator has also made an approach to lease serviced apartments, should they be built on surplus land at the back of the property” advised John Feros of JDA Hotels.
The hotel, even in its currently unrenovated state, attracts in excess of $8.0m in annual receipts from predominantly high gross profit margin revenue centres.
The decision to auction the hotel, is sure to attract the interest of an industry already in overdrive. “Auctions are at the core of our businesses history, but there haven’t been any for some time.” “We’ve had some wonderful success auctioning significant properties in the past, and the industry always supports the certainty of an auction campaign” commented Jolliffe.
The Mascot area is undergoing wholesale development, and Sydney airport and related services is reported to have had its busiest year on record. Enjoying the bulk of the 8m visitors to Australia’s shores this year.
Also being auctioned in the CBD offices of Ray White on 1 December is a 9000sqm Wollongong Hotel, The Figtree. Jolliffe anticipates spirited bidding for both properties.
In addition to the Tennyson and Figtree Hotel auctions, Jolliffe is also selling, via EOI, the eastern suburbs beachside hotel icon, The Clovelly Hotel.
Source: 11th November - raywhite.com
