Black Rhino Hotel Group has begun an acquisition spree targeting gaming hotels in metro and regional South Australia following gaming reform in the state.
The group has purchased the Newmarket Hotel on the corner of Commercial Road and Dale Street in Port Adelaide in a deal brokered jointly by Grant Clarke of McGees and Mathew George of CBRE Hotels.
David Tomsic, owner and managing director of Black Rhino Hotel Group, is the owner of 20 pubs in Victoria, with more on the way over the next 12 months – however, this appetite for growth in his home state has been slowed by the all-time premiums being sought.
“In recent months we have seen some of the highest prices and sharpest yields being paid on record for gaming assets (leasehold and freehold),” George said.
“Prices have well and truly surpassed previous levels, a trend fueled by the low cost of debt and rebounding trading results. Identifying the hotel opportunities on offer in SA, we worked with David and his team to fly over pretty soon after interstate travel and borders reopened – and they were quick to act, knowing that the Adelaide market has strong predicted growth, will benefit from recent reform to gaming legislation and offers relatively cheap additional entitlements, in
comparison to Victoria.”
George added that most of the assets changing hands in South Australia are at an attractive price point (sub-$5 million) for freeholds.
“Our plans are to buy pubs and keep the existing staff on, inject some capital into them, upgrade the product on the floor and deliver high-quality venues back to the patrons and locals,” Tomsic added.
“I’m super excited about coming into South Australia and seeing in this new era for us, we have several other exciting deals to announce in the very near future – both regional and metro, and my senior management team share my enthusiasm about our expansion.”