The Redcape Hotel Group has bid farewell to Royal Hotel in Granville, while at the same time welcoming a new asset through the purchase of the Kings Head Tavern in Hurtsville for $27 million.

The sale of the Royal Hotel for $51 million was a 6.25 per cent premium on the book value.

Both deals were brokered by JLL Hotels and Hospitality group’s John Musca, contributing to an already record-breaking year for the group.

The Royal Hotel is consistently ranked among the very best gaming hotels in the state, enjoying a high traffic retail strip position opposite Granville train station and includes 30 EGMs, public and sports bars.

Mr Musca said JLL was delighted to have assisted the private purchasers to fulfil their long-term local property and hotel aspirations.

“In a rapidly consolidating asset class, this sizable transaction is another example of the value afford to the very best assets across the densely populated Sydney metropolitan area,” he said.

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The Royal Hotel in Granville. Source: JLL

The Kings Head Tavern includes 27 gaming machines, restaurant, public and lounge bars, drive-through bottle shop and beer garden. Occupying a prominent 1,334 square metre corner position on King Georges Road, the property also offers future multi-level mixed-use development potential.

For JLL Hotels, it was a record 15th hotel asset transaction in metropolitan Sydney with an average NSW deal size of $27.1 million.

Mr Musca said the sales were part of a wider shift in the industry

“After years of unsolicited buyer approaches, the long-time owners of the King's Head Tavern sought JLL’s assistance to facilitate the sale,” he said.

“More than ever the increasing sophistication of the market and capital sources, has seen a move towards truly national or global agency platforms to deliver divestment solutions, particularly off-market.”

Redcape CEO Dan Brady said the transactions were consistent with the brand's strategy of optimising its portfolio.

“This demonstrates our continued focus on acquiring venues where we can increase value by enhancing their operations and applying our refurbishment capability," he said.

The sales follow recent Redcape investments in the St George Hotel in Belmore for $47.1 million (also facilitated by JLL Hotels) and the Eden Brewhouse in Redbank Plains, Queensland for $11.5 million.

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