AFL club cashes in on Melbourne's biggest pub deal yet
AFL club Hawthorn will cash in on Victoria’s biggest pub deal yet, the $85 million sale of the WestWaters Hotel in Melbourne’s outer west where the football club has run a lucrative pokie machines business.
The hotel and entertainment complex has been sold to NSW hospitality player Oscars Hotels. The record result represents a combined price for both the leasehold, held by the football club, and the freehold real estate owned privately by investors including busy property player David Feldman.
The exit from the Caroline Springs venue winds down a large part of the Hawthorn Football Club’s exposure to gaming machine revenue, a long-standing goal of some members of the famous footy club, which is led by former Victorian premier Jeff Kennett.
Although a significant transaction for the football club, the record deal is even bigger news in the hospitality sector where it eclipses the state’s previous benchmark, the $54.5 million sale of Bendigo’s All Seasons Hotel to the Redcape Hotel Group last year.
WestWaters has 90 gaming machines licences, more than half of the total machines run by the football club. The remaining machines are at the Vegas Club at Waverley Gardens Shopping Centre in Mulgrave.
Revenue from the record deal will help the Hawks accelerate its long-standing plans to build a $100 million training base, dubbed the Kennedy Community Centre, at Dingley in Melbourne’s south-east.
The club’s chief executive Justin Reeves told club members in March that the club was confident it could begin construction on the Dingley facility later this year.
The Bendigo’s All Seasons Hotel and the WestWaters Hotel deals were both brokered by JLL Hotel’s & Hospitality’s Will Connolly and John Musca.
“Within the past six months alone, we have witnessed over $180 million of NSW-based capital investing in the Victorian industry, across three of the most significant hotel transactions to ever occur in this state,” Mr Connolly said on Wednesday.
The WestWaters hotel stands on a 7000 square-metre site in the heart of the Caroline Springs retail precinct. The facility has 98 guest rooms under the Mercure brand, a large bistro and restaurant along with a sports bar with a TAB.
The venue includes conference and wedding facilities, an indoor heated swimming pool, as well as a spa and sauna.
Pub sales have surged over the past year across city, coastal and country markets nationally, with both private investors and larger operators confident the sector would bounce back strongly from the disruptions of COVID-19.
That trend has sent an influx of interstate capital into the Victorian pub market, which historically has been dominated by large intergenerational family groups, according to JLL’s Mr Musca.
“We are representing a significant weight of capital moving from NSW to Victoria and similarly South Australia, as a natural geographical expansion for operators requiring a national footprint as a response to the supply challenges in an ever-tightening NSW hotel market,” he said.
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