Historic pub changes hands for $40m
Redcape Hospitality, a hotel fund run by ASX-listed MA Financial, has snapped up The Plough Inn in Brisbane for $40 million, one of the city’s oldest and best-known pubs, amid a surge of deals that has pushed investment in the sector to historic highs this year.
Built in the 1880s, the freehold of the heritage-listed venue on Brisbane’s South Bank was held by Sydney Roosters chairman and billionaire Nick Politis’ Eumundi Group, a previously listed landlord taken private by Politis’ SEQ Hospital Group last year.
The Brisbane transaction is the latest example of a wave of investment into the pubs sector that has sent transactions past $1.7 billion already this year, well ahead of the annual average of $1.48 billion.
Investors including family-run groups and fund managers are scrambling to get hold the best venues available, confident the sector has plenty of growth to offer even though young people are drinking less.
Chris Unger, managing director at Redcape Hospitality, said the Brisbane acquisition was indicative of what the hotel fund had been aiming to achieve in the past 18 months: identifying venues in busy places and with strong patronage.
“This one really squarely fits into that,” Unger told The Australian Financial Review. “It’s proven over a long period of time to be consistently successful and busy year-round. This makes it very attractive and an ideal addition to the portfolio and we can’t wait to work with the team there to build on that success.”
He also hinted at a potential refresh of the venue after the New Year.
The Plough Inn will be added to the MA Redcape Hotel Fund, whose $1 billion portfolio holds venues across NSW and Queensland. As of September, the fund had achieved 21 per cent year-on-year earning growth.
On the sell side, KickOn Group’s Shearer said the Plough Inn had been part of Brisbane’s story for well over a century.
“Our team has been proud to contribute to that history, and we’re pleased to hand the reins to Redcape, who we know will continue to honour and grow the pub’s place in the community,” he said.
The deal was brokered by JLL’s Tom Gleeson as well as Savill’s Leon Alaban and Joseph Ganim.
The Brisbane transaction follows a number of headline deals so far this year including businessman Scott Didier’s purchase of The Beach Hotel in Byron Bay for $140 million and former Wallaby Bill Young’s acquisition of The Gem Hotel in the NSW Riverina region for $50 million.
“People are trading into pubs, and the offer that pubs have is just getting better and better, and we’re seeing some pretty strong growth across the food beverage part of the business,” Redcape’s Unger said.
Redcape also acquired The Orion Hotel in south-east Queensland for $30 million in August and announced it was targeting a raising of $50 million to $70 million in capital to spend on new venues. The fund also acquired the Prince Consort in Fortitude Valley for $45 million earlier this year.
