NEWS PROPERTY

ASX-listed Lantern Hotel Group has continued its divestment program of non-core assets with the sale of the freehold and business of the Courthouse Hotel in Cairns for $6.25 million. The sale, at a 28 per cent premium to the 31 December 2015 book value was negotiated by CBRE Hotels. Since the start of the year Lantern has sold more than $50 million worth of property. Both the Lawson park Hotel Mudgee and the Central Hotel Bundaberg are up for sale.

Government Property NSW has tipped a major development site in Sydney’s Parramatta onto the market, with hopes of fetching more than $30 million from a publican or a hotel developer. The state’s property arm has appointed JLL’s Sam Brewer and John Musca to sell the ageing office block at 127 Argyle Street, in prime position opposite Parramatta’s train station and adjacent to the local Westfield shopping centre. The freehold site is being offered to market carrying a hotel licence and gaming assets and is being pitched as a potential hotel and pub within a broader development. The site at one stage was earmarked for a $100 million office tower by St Hilliers, which committed to pay $22 million for it around 2008.

The Good Beer Group is selling its Dove & Olive Hotel in Sydney’s Surry Hills with the cash raised being deployed to the planned upgrade of its recently acquired Duke of Gloucester Hotel in Randwick. JLL national director John Musca​ is selling the Dove & Olive and said it had established itself as one of the busiest local hotels in Sydney, consistently generating over $100,000 per week in revenues. Mr Musca said the offerings of craft beer and value-for-money food was what patrons were now seeking instead of just a bar with a television in the corner. Demand for quality city-fringe hotels is on the upward trajectory as customers leave city-based hotels for a range of reasons, including the lockout regulations. Pub sales are the hot ticket with close to $200 million of pubs changing hands in the past year in Sydney alone, with Melbourne not far behind. Pub agents said this appetite augured well for the upcoming sale of the Keystone Group assets, which involve 16 leaseholds and one freehold food and beverage outlet across the country. Keystone was placed into the hands of receivers and managers in June after failing to repay a debt of about $80 million owed to Californian private equity firm Kohlberg Kravis Roberts (KKR) and the Singapore-based Olympus Capital Holdings Asia. Morgan Kelly, of Ferrier Hodgson, is working on the sale of the businesses, which include the Jamie’s Italian chain across the country and the Sydney-based Cargo Bay, Sugarmill, Kingsley’s Woolloomooloo and Bungalow 8, among others. It is understood Mr Kelly is close to launching the sales process.

The Good Beer Group is selling its Dove & Olive Hotel in Sydney’s Surry Hills with the cash raised being deployed to the planned upgrade of its recently acquired Duke of Gloucester Hotel in Randwick. JLL national director John Musca​ is selling the Dove & Olive and said it had established itself as one of the busiest local hotels in Sydney, consistently generating over $100,000 per week in revenues. Mr Musca said the offerings of craft beer and value-for-money food was what patrons were now seeking instead of just a bar with a television in the corner. Demand for quality city-fringe hotels is on the upward trajectory as customers leave city-based hotels for a range of reasons, including the lockout regulations. Pub sales are the hot ticket with close to $200 million of pubs changing hands in the past year in Sydney alone, with Melbourne not far behind. Pub agents said this appetite augured well for the upcoming sale of the Keystone Group assets, which involve 16 leaseholds and one freehold food and beverage outlet across the country.

A Great Barrier Reef island owned by a friend of the British royal family is on the market for a price of up to $30 million. After achieving development approval with the Queensland government to turn Keswick island into a residential and tourism resort, its owner, Keswick Developments, owned by Edward Dawson-Damer, a former equerry to Queen Elizabeth and a family friend to the royal family, has decided to sell it and move onto other ventures. The new owner will have a 117-hectare development lease with the Queensland government until 2096. Altogether, the island is 517 hectares with 400 hectares of national park. The purchase will also give the buyer a 25-hectare seabed lease for a 180-berth marina and deep water jetty. The mixed-use zoning on the sub-tropical island can accommodate 1000 dwellings and 3000 people. The island, 32 kilometres off the coast of Mackay, already has a sealed airstrip, 150 subdivided lots, and preliminary key infrastructure for ongoing development.

Giant Chinese developer Greenland Group has added its five-star Primus Hotel in Sydney’s CBD to the parcel of hotel assets to be injected into a proposed real estate investment trust to be listed in Singapore. Greenland flagged the plan earlier this year to sell 19 hotels in China with an estimated value of 21 billion yuan ($4bn) to a hospitality REIT, teaming up with Singapore’s Amare Investment Management Group, which specialises in commercial real estate investment. The parcel of assets has now been expanded, with two more hotels being added, including the Primus Hotel in Sydney and the Hotel Indigo in Los Angeles, Amare Investment CEO Alvin Cheng said.

A bold decision by funds giant LaSalle Investment Management to sell its $250 million refurbished Collins Street retail asset with stores still to open has paid off, with a buyer now in due diligence. The trophy asset in the heart of the city was offered along with the Novotel hotel in a $500 million portfolio, to be sold as two-hander or as single assets. A likely buyer is JP Morgan Asset Management, a global investor which has recently offloaded a $250 million industrial portfolio to AMP Capital. The asset manager, which can act on mandates from institutional or private investors both offshore and locally, has been busy looking at a number of Melbourne assets, sources said.

Malaysian developer Beulah International has been snubbed in its bid to buy the Celtic Club on Queen Street. Celtic Club members voted last week against selling its three-storey premises, the former West Bourke Hotel on the corner of La Trobe Street, to a mystery buyer for $25.6 million. The deal needed the approval of 75 per cent of voters but fell short of its target with only 71.6 per cent voting in favour of selling. Celtic Club president Brian Shanahan declined to return calls. Celtic Club secretary Felicity Allen said “What we have to do now is dust off plans to refurbish the club.” Club membership had increased 17.5 per cent in the past year, rising to 971, Dr Allen said. The mystery buyer turned out to be Malaysian-backed Beulah International, run by architect Adelene Teh and Jiaheng Chan, which has its headquarters in Collins Street, Melbourne.