Burleigh Waters Tavern sale set to raise the bar
The sale of a landmark Burleigh Waters Tavern is expected to set records as the wave of investment pouring into the Southern Gold Coast shows no sign of slowing.
The Varsity Lakes Tavern and Dan Murphy’s, operated by Australia’s leading hotelier and liquor retailer ALH, will be sold by an Expressions of Interest campaign closing in November.
ALH is a subsidiary of listed entity Endeavour Group, which recorded a 9.3% increase in turnover inFY2021 of $11.6 billion.
The 17,000sqm freehold site, which enjoys a high profile 128m frontage to Southport Burleigh Road, is zoned for redevelopment up to 24 metres in height and also includes a long-term sub lease to market-leading Fitness & Lifestyle Group, trading as Fitness First.
Matthew Wright, Senior Sales Executive at Burgess Rawson said the tavern and gym are leased to ALH on a long Weighted Average Lease Expiry (WALE) of 7.7 years on favourable triple net leases.
“Triple net leases are highly sought after by investors who are becoming more in tune with the rising costs of ownership –chiefly rising land tax and structural management,” Mr Wright said.
“Under these lease agreements, the tenant is responsible for managing all operational costs. The buyer pools for triple net leased properties are generally double those without.
“Endeavour Group, through its ALH portfolio, has made a long-term commitment to this asset and are a highly prized tenant who have occupied the site since inception and continue to invest in its presentation, performance and upkeep.
“Through its patronage, Varsity Lakes Tavern has become one of the area’s leading hotels. This, combined with the tavern’s proximity to Bond University and its 5000-strong student & staff population, makes it a compelling investment opportunity.”
Varsity Lakes Tavern operates under a 4am licence and features The Grillhouse Restaurant, Grillhouse Bar, Sports Bar and 40 gaming machines.
Commonwealth Bank’s Executive Client Acquisition -Commercial and Corporate Banking Justin Yu said that investors are actively seeking these types of investments.
“The appetite is high,” said Mr Yu. “The Endeavour Group is amongst the best covenants in the premium freehold investment market. Our clients are seeking exactly this type of asset and the Commonwealth Bank is keen to fund them.”
Tony Bargwanna, Director Savills Hotels, said the Southern Gold Coast has become the focus of considerable investment during the past year, driving strong population growth forecasts.
“Prime hotel assets such as this continue to be an attractive asset class for savvy investors, particularly in regions where there is strong population growth and investment in new infrastructure,” Mr Bargwanna said.
“Varsity Lakes Tavern is located at the heart of this growth and is well placed to benefit from the renewed focus on lifestyle, dining and entertainment.”The Varsity Lakes Tavern is strategically located nearby to Bond University and adjoins Burleigh Home Space, featuring Harvey Norman, BCF, TK Maxx and Baby Bunting.
The Expressions of Interest Campaign is being managed by Burgess Rawson in conjunction with Savills Hotels and closes on 12 November 2021