Andrew Jolliffe and Daniel Dragicevich of Ray White Hotels Australia and CBRE Hotels respectively have been exclusively retained to sell the real estate and business of one of Sydney's iconic beachside pubs for sale, The Clovelly Hotel.
With the Australian A-grade hotel market in overdrive following recent sales of numerous well known properties including North Sydney's Commodore Hotel and The Colombian in Surry Hills, leading agents Andrew Jolliffe and Daniel Dragicevich of Ray White Hotels Australia and CBRE Hotels respectively have been exclusively retained to sell the truly iconic beachside institution, The Clovelly Hotel.
Like the Commodore Hotel which Jolliffe sold earlier this week, the long-time favoured watering hole has been quenching the thirst of generations of Eastern Suburbs patrons and visitors to the beachside enclave for over 150 years. "The Cloey is one of those folklore hospitality businesses that most Sydney-siders, and numerous others from much further afield, will have an affinity with" commented Jolliffe. "The Cloey really does embody so many of the great things about the Australian pub culture; ranging from the very focal point around which a whole community orbits, to an almost inimitable gathering place in the social history of surf lifesaving in the Eastern beaches area, all codes of football and horse racing" said Jolliffe.
Acquired by the current owner Iris Capital in 2008, The Cloey was extensively renovated in 2012; and presents as a yard stick by which other hotel renovations are regularly measured.
Conjunction agent Daniel Dragicevich is enthusiastic about the undoubtedly strong level of interest the international sale process will garner. "The Cloey is such a complete package. Sitting proudly upon a high point on Clovelly Rd and with views of the Pacific Ocean, the impressive building is attractively presented and its proximate relationship to Clovelly, Bronte and Coogee beaches means that an element of the $9.1M in annual sales is notionally underwritten by the sheer weight and regularity of visitors to the area" advised Daniel Dragicevich.
With the Eastern Suburbs being home to the nation's most valuable property holdings, successful beachside businesses are hard to replicate according to Jolliffe. "What the recent sales of iconic hospitality properties in one hotel suburbs like Newport, Mona Vale and Watsons Bay has taught us, is that these assets are, frankly, irreplaceable. They aren't building any more Coogee Bay, Bondi or Clovelly hotels; so the wholly compelling longevity and barrier to competitive challenge attributes enjoyed by this hotel is patently clear." "And the opportunity to take ownership of one of these incredible cash flow machines sitting abreast blue chip property holdings, is an unparalleled investment proposition; irregardless of asset class" affirmed Jolliffe.
Daniel Dragicevich agrees that the unique nature of the opportunity to acquire the Clovelly Hotel is one afforded only a handful of astute and very well-known investors including Justin Hemmes (Coogee Pavilion), Chris Cheung (Coogee Pavilion), Kim Maloney (Bondi) and Arthur Laundy/Fraser Short (Watsons Bay). "There's no coincidence that the list of owners of other iconic beachside hospitality properties reads like a veritable hotel industry hall of fame roll call" concluded Daniel Dragicevich.
"Our vendor has owned the property for almost a decade, and has historically shown good portfolio hygiene practices by cycling his hotels in and out of the stable dependent upon where his focus and related strategic objectives lay at a given point in time" added Daniel Dragicevich.
Whilst continuing to trade very well, notwithstanding the remarkable arrival of Justin Hemmes' Coogee Pavilion in 2014, Jolliffe believes the range of upside triggers available to an incoming purchaser are many; including repurposing the food offering, and completely repositioning the accommodation offering at the hotel to better address the hugely unsatisfied demand for boutique overnight stays in Sydney's Eastern beaches region. "In my view, a new set of eyes looking at The Cloey can extract considerably more revenue than the already impressive annual sales capture, and this is a universal theme across virtually all current revenue departments" believes Jolliffe. However Jolliffe believes that potentially the most exciting opportunity could exist in the form of an updated accommodation offering.
"In the past year Australia, largely due to the fantastic work Tourism Australia have done, has enjoyed its best year of tourism statistics with 8 million visitors recorded as having travelled here." "Separately, there were 250 million domestic market generated room nights pointing to the increase in shorter, more localised stay options holding favour." "Accommodation in Australia is forecast to be a $127bn annual overnight stay industry in the year 2020, and land holdings in proximity to world class locations such as the Clovelly Hotel are incredibly well positioned to take long term advantage of this tourism lead economy boost. One which has now surpassed mining as a national source of economic activity" concluded Jolliffe.
The Clovelly Hotel is being sold via an international EOI process commencing 29 October and concluding 23 November 2016, meaning the successful purchaser can potentially take advantage of the legendary Christmas and New Year trade enjoyed by the hotel.
See also:
The Tamworth Hotel First Time Offered For Sale