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Large slice of Brisbane land with holding income hits the market

Property Markets / Planning, Zoning, Infrastructure

Australia

Feb 23 2017

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Brisbane, 23 February 2017 – One of Brisbane’s last remaining ‘large format’ hotels, the Mansfield Tavern, has been listed for sale.

Located just 11km from the Brisbane CBD, positioned on a 20,830sqm land parcel in south-east Brisbane, the Mansfield Tavern and First Choice Liquor is leased to Wesfarmers subsidiary, Liquorland (Qld) Pty Ltd.

The Mansfield Tavern, located at 181 Wecker Road in Mansfield, is a popular venue incorporating a public bar, gaming room with 31 machines, large entertainment space and detached function room/bistro. There is also onsite parking for approximately 227 vehicles.

CBRE Hotels’ Glenn Price, Paul Fraser and Daniel Dragicevich have been appointed to sell the property via an Expression of Interest process.

Mr Price said the property’s tenancy profile would attract strong buyer interest.

“In recent years, hotels leased to either Liquorland (Coles) or ALH (Woolworths) have been tightly held, with those that have come to the market being seen as prized assets by purchasers and subsequently strongly sought after,” Mr Price said.

“Not only are we likely to see the regular hotel investors chasing yield on this asset, but with banks’ willingness to lend on assets such as these, hoteliers and developers are also likely to run their eyes over the opportunity.”

Mansfield Tavern has been leased to Liquorland for the past 20 years with a further five-year option available for execution, providing an astute investor holding income from an AAA rated covenant.

Coles (Liquorland) is the country’s second largest hotel operator, with a portfolio of 98 hotels.

The suburb of Mansfield was originally developed as government housing estates, but has progressively been replaced by larger private residences in recent years. These dwellings are overwhelmingly occupied by couple families largely because of the public and Christian schools in immediate proximity (Mansfield State School, Mansfield State High School, Christian Outreach College and Brisbane Adventist College).

In addition to these schooling facilities, major tertiary study institutions Griffith University and TAFE Queensland both have campuses within 5 km of the Mansfield Tavern.

Mr Price said the opportunity to acquire a significant landholding with development potential in such close proximity to the city centre would be of strong interest to both investors and developers.

“The Mansfield Tavern is a unique opportunity - not only due to the sheer scale of the site but also due to the term of the current lease. Upon expiry of the lease, the opportunity exists for an investor to restructure a new lease across the property on favourable terms or for a hotelier, the ability to run the business operation of the hotel capitalising on the reversionary value of the business. Developers are also likely to see the intrinsic value of the site with the ability for redevelopment in the future,” Mr Price explained.

Mr Dragicevich commented: “A new hotel could be repositioned on the site, unlocking a large portion of the land which could then be developed into apartments, town houses, aged care or possibly retail uses subject to council approvals.”

Current rental income for the hotel is approximately $810,000* (excl. GST) with the freehold owner having the option to retain ownership of the gaming machines upon expiry of the lease.

 

About CBRE Group, Inc.

CBRE Group, Inc. (NYSE:CBG), a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world’s largest commercial real estate services and investment firm (based on 2016 revenue).  The company has more than 75,000 employees (excluding affiliates), and serves real estate investors and occupiers through approximately 450 offices (excluding affiliates) worldwide.  CBRE offers a broad range of integrated services, including facilities, transaction and project management; property management; investment management; appraisal and valuation; property leasing; strategic consulting; property sales; mortgage services and development services.  Please visit our website at www.cbre.com.

SOURCE: Press Release

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