Sydney hotelier Oscars goes to Adelaide for $80m venues deal
Mario and Bill Gravanis’ Sydney-based hospitality company Oscars Group is expanding into South Australia for the first time with the purchase of three hotels in Adelaide for about $80 million.
Fresh from their purchase of Sydney’s Luna Park at the end of last year for more than $50 million, the Gravanis brothers have now established a substantial foothold in the Adelaide market, acquiring the Lakes Resort Hotel, Bridgeway Hotel and Maid & Magpie Hotel.
“We were excited by the portfolio opportunity that [commercial agency] JLL identified as a natural fit to our diversified hospitality interests and national growth strategy, and are grateful to the Fahey family for the carriage of these great businesses,” said Bill Gravanis, co-founder of Oscars Group.
Oscars’ move to Adelaide comes amid a race for consolidation in the buoyant pubs and venues market as private families and fund managers look to extend and diversify their exposure to hospitality earnings.
It’s been a busy week for deals in the sector already, with businessman Scott Didier purchasing The Beach Hotel in Byron Bay for $140 million from Redcape Hotel Group, marking the second-highest price paid in a pub trade on record.
As well, emerging pub baron Glenn Piper snapped up the Bermagui Beach Hotel in New South Wales for about $20 million in an off-market deal, adding to his $200 million hospitality portfolio that has expanded to nine coastal venues.
On the sell side of the Adelaide transaction is South Australia-based hotel group Fahey Hotels, headed by third-generation hotelier Greg Fahey.
Along with Luna Park, the Gravanis brothers’ portfolio holds a number of popular venues: Hotel Sweeney’s in the Sydney CBD, The Beachcomber Hotel and Resort on NSW’s Central Coast, and Crowne Plaza Surfers Paradise which was purchased for $100 million in 2022.
To that portfolio of more than 40 hospitality venues, the Adelaide deal brings with it another 80 hotel rooms, along with 30,000 square metres of land and 113 gaming machines, as well as expansive retail liquor and function facilities.
Oscars said each of the three Adelaide venues would help diversify the platform’s revenue sources. The Lakes Resort Hotel in West Lakes had a strong rooms division with conferencing, along with a food and beverage business that boasted the award-winning restaurant Tunki and a high-volume off-premise retail business, it said.
The Bridgeway in Pooraka has a well-established history of live entertainment, while The Maid and Magpie in Stepney was a popular food and beverage haunt that hosted the Lucky’s Beach Club for five months each year, the company said.
John Musca, executive director at JLL Pubs Australia, who managed the sale with Terry Board of T.J. Board Hotels, said the sale showed the confidence that big hoteliers had for the Adelaide market.
“Adelaide’s just starting to catch the eye of the astute capital in the asset class now because there’s good, steady growth down there [and] it’s perceived to be a very stable legislative environment,” Musca told The Australian Financial Review. “The group operators all feel they can go down there and add real value to those portfolios.”
Another big mover in the Adelaide market is the Australian Venue Co, one of the nation’s biggest hospitality operators, which bought out Saturno Hotels’ portfolio for about $90 million in 2022. Similarly, Harvest Hotel Group has expanded its $100 million portfolio, adding four South Australian pubs in the past two years.
