Mining company buys, renovates, occupies and sells Queensland pub
A civil construction company that bought and renovated a historic Queensland pub to house its own workforce is now selling the hotel at a healthy yield of 10 per cent.
According to title records, in 2020 Exact Civil Constructions paid $300,000 for the Royal Private Hotel in Charters Towers – a town about 120 kilometres south-west of Townsville – amid an acute shortage of long-term accommodation in the gold-mining region.
The company then injected more than $625,000 into renovating and refurbishing the 23-room hotel.
With a booming resource sector in the region, mining and infrastructure companies often struggle to accommodate their workforces, but it’s a key factor at play in securing lucrative contracts.
“It may seem extreme, but logistically and financially it makes perfect sense,” said Ray White Commercial director Chris Massie.
“The difference between winning and losing these multi-million dollar contracts is consistently coming down to who can attract and accommodate the skilled labour needed to complete the job.”
The hotel’s accommodation, and its commercial kitchen and licensed pub, are currently exclusively used by the construction company’s employees while they work on the nearby Pajingo Gold Mine.
Exact Civil Constructions has listed the hotel for sale with an asking price of $1.4 million, with a two-year lease returning a net rental income of $140,000 – representing a 10 per cent yield.
“Knowing that our position is secure with this accommodation as a home base is essential to our business, but accommodation is not our core business,” said company director Troy Schmidt.
“We are happy paying rent so we can invest back into the machines we need to capitalise on the extensive opportunity pipeline we see in this region for years to come.”
The sale includes all the furniture, licences, plant and equipment, however, the facility will be managed internally by the tenant, Exact Civil Construction.
Massie said the asset would appeal to investors seeking a passive investment with an immediate income, or a publican with a vision of being more hands-on. Beyond the current lease arrangements, there is scope for the venue to return to a more traditional hotel/motel.
However, more contractors are expected to flood into the region in the coming years to work on the Australia-Singapore Military Training Initiative, a $2.25 billion joint venture in Greenvale.
The Royal Private Hotel was built in 1888, when landmark buildings in Charters Towers were constructed from the profits of the gold rush, and the district was attracting thousands of migrants seeking wealth.
Set on 2400 square metres, 100 Mosman Street, Charters Towers, is for sale through Ray White Commercial via private treaty.
