Private Sydney group Tilley and Wills Hotels has purchased the Elephant Hotel in Fortitude Valley for more than $20 million.
The pub group made its first foray into the Brisbane pub market, buying the multi-level building on a 1,237sq m freehold from the Riversdale-operated Australian Pub Fund.
The Australian Pub Fund sold the 230 Wickham Street venue at a loss after acquiring the asset for around $27 million in mid-2013.
The pub was refurbished that year with four separate bars, a large outdoor beer garden and a gaming room with 42 machines.
However development on the site would be difficult as the property—first opened in 1888 as the Prince Consort Hotel—was placed in the Queensland heritage registrar in 1992.
CBRE’s Paul Fraser and Jack Morrison in conjunction with JLL’s Tom Gleeson negotiated the sale.
“The incoming operators, Tilley and Wills Hotels, have an enviable track record of successfully re-inventing venues and are excited to bring their distinct style to the iconic Elephant Hotel and capitalise on the long-term prosperity of the Fortitude Valley precinct,” Fraser said.
“The high-profile sales campaign generated over 60 enquiries and eight offers nationally, highlighting the appetite for large format going concern hotels with diverse income streams and obvious operational upside opportunities .
“Demand strongly outstrips supply in Queensland’s South East corridor, which has led to heightened market tension and an overall tightening of cap rates.
“With cost of debt at an all-time low we don’t see this current environment changing in 2020; it is certainly a sellers’ market right now.”
Nick Wills and Simon Tilley lead the Sydney pub group operating Buena Hotel, Bistro Mosman, Clovelly Hotel, Verandah Bar, Social at Verandah, Greenwood Hotel, the Balmain Hotel, Hotel Delany and the Oxford Art Factory.