Sydney's Watsons Bay Hotel sells

Watsons Bay Hotel has sold in an off-market transaction between two hotel industry heavyweights.

The famous venue has been owned and operated by the acclaimed Doyle family for 125 years and five generations, and is rumoured to have changed hands for an amount around $30 million.

Industry sources speculate that the sale was to former Keystone owner Fraser Short, who recently opened The Morrison in the Sydney CBD.

Short was unavailable for comment.  

The sale was brokered by Glenn Cooper of Cooper Hotel Brokers, who points out that venues like Watsons Bay Hotel will never be replaced in the modern era.

"The hotel market will start to pick up, as interest rates reach historic lows," Cooper told TheShout.

"The difference between the interest rate and capitalisation rate at which hotels are being bought, is becoming very attractive. As interest rates drop, the difference between the rate and the return on the hotel is widening.

"What's more, in the current licensing position, where there is no increase in poker machines in NSW and yet Sydney's population is growing at 1000 people per week, as hotels are renovated and upgraded, business has got to improve."

At the other end of the market, the Canterbury Club Hotel has sold for around $7 million to the Thomas Hotel Group (THG) despite being bought pre-GFC for over $35 million by National Leisure & Gaming (NLG) in 2007.

NLG sold the venue, situated in a strong gaming area, to the Murphy Hotel Group for $11 million with all assets and fittings removed.

THG operations manager Chris Thomas was unavailable for comment, but the purchase price provides the new operator with opportunity to develop a successful business model in a growing revenue sector.

Source: The Shout, 5 October 2012