Iris Capital has picked up the Narwee Hotel for $45 million from its long-term owners the Ryan family in a move marking Australia’s largest pub sale of the year.
Owned and operated by the Ryan family for more than 30 years, since 1987, the Narwee Hotel sits 18 kilometres south of the Sydney CBD on a 3370sq m commercial site.
The sale continues the run of established investors buying A-grade hospitality properties amid record-low rates.
The previous highest paid price for a pub this year was the Macquarie Tavern in Liverpool, which sold on behalf of Monarch Hotels to the De Angelis family for $43 million.
Last month, Justin Hemmes’ Merivale purchased a Randwick pub, the Duke of Gloucester Hotel, in Sydney’s eastern suburbs for $32 million.
Iris Capital, led by Sam Arnaout, has been steadily expanding its hospitality portfolio, which also includes the Golden Tiger Hotel at Hurstville, The Bourbon at Potts Point, and Steyne Hotel in Manly secured for $60 million in May last year.
Arnaout said the Narwee asset pub purchase had presentation and positioning.
“The asset satisfied not only our key investment criteria, but also met a geographical objective we held for that part of Sydney,” Arnaout said.
Last month Arnaout’s Iris Capital also paid $180 million for a portfolio of 17 Ibis hotels from Accor Invest.
The deal struck with the French hotel giant was for the 17 Accor operated hotels comprising 1,800 rooms across Australia.
The Narwee pub transaction was managed by HTL Property’s Andrew Jolliffe, Dan Dragicevich and Sam Handy.
“The sale price achieved pays deference to the nature of the opportunity and is justified given the scarcity of large-format Top 150 gaming hotels which also enjoy strong food, beverage, accommodation and alternative use value,” Dragicevich said.
The sale of the Narwee Hotel continues the national run rate of one hotel being sold per week in 2020, HTL Property said.
“When we consider the origin of the most recent capital deployment events, it is almost exclusively linked to leading groups such as Redcape, Merivale and Iris Capital,” HTL Property managing director Andrew Jolliffe said.
“This is instructive on a range of levels, however most notable is the fact that some particularly experienced actors within the asset class are the ones who are prosecuting the most definitive acquisition strategies.”