Private equity buyer Blackstone circles Hamilton Island deal
US private equity giant Blackstone could emerge as the owner of one of Australia’s best-known resorts, the $1 billion Hamilton Island in Queensland owned by the Oatley family for more than two decades.
While still in preliminary stages, if a deal is struck, it would make Blackstone, which already controls Crown Resorts, a major force in the country’s hospitality sector as its recovery from the lean years of the pandemic gathers pace.
Blackstone has nominated the hospitality sector as one of its high conviction investment themes globally. Three years ago, the US investment house took over the Crown business for $8.9 billion although its commitment to rebuild the business is proving costly.
Blackstone declined to comment on the proposed Hamilton Island transaction.
The billionaire Oatley family inherited Hamilton Island along with other businesses from their father, winemaker and sailor Robert Oatley who died in 2016, aged 87. Two years ago, the family appointed UBS to run a strategic review of Hamilton Island after receiving approaches for the destination.
Within months, however, in late 2023, the family had decided not to proceed with any transaction.
Among the parties previously interested in the resort was another US investor KSL Capital, which had put forward a bid around the $900 million mark, a source said.
“The deal didn’t go ahead. They were pretty keen on a billion-plus price tag,” the source told The Australian Financial Review on Thursday.
Hamilton Island was first developed in the early 1980s and sold to Robert Oatley – better known as Bob – for about $200 million in 2003. Oatley was a former coffee trader who made his first fortune selling Rosemount Estate to Southcorp for $1.5 billion.
It is among the larger islands in the Whitsundays. With its own airport servicing direct flights from major cities, Hamilton Island is a gateway to the popular tourist region around the Great Barrier Reef.
The island has since become part of Balmoral Australia, the Oatley family office, which is now run by Sandy Oatley. His siblings, Ian and Rosalind, sit on the board, alongside ex-Virgin chief John Borghetti, former Deutsche Bank CEO John Macfarlane and Guido Belgiorno-Nettis. Balmoral’s other assets include Woolwich Dock in Sydney, along with a range of other investments in private and public markets.
The family has invested heavily in Hamilton Island over the years, including more than $450 million upgrading the tourism facilities.
As a major tourism asset, it dwarfs other private islands along the Queensland coast which are proving increasingly popular with wealthy investors such as Annie Cannon-Brookes, who bought Dunk Island off the coast of Mission Beach in Far North Queensland three years ago for just under $25 million.
Another island owner is Computershare co-founder Chris Morris, who bought Orpheus Island near Townsville almost 15 years ago while Andrew Forrest and Nicola Forrest, who have since separated, bought Lizard Island in Far North Queensland for $42 million through their investment company Tattarang in 2021.
