Vertua Opportunities Fund is pleased to announce the settlement of Lismore Gateway Motel, at 99 Ballina Road, Lismore NSW 2480, Australia for $5.4mil on 26th April 2019. The motel is located within 5 minutes’ drive to Lismore CBD, Lismore Regional Airport and only 20 minutes’ drive from Ballina.
Lismore is a commercial heart of Northern Rivers, cultural hub and a tourism gateway to the North Coast region of NSW. It is located only one hour away from Byron Bay and two hours from Brisbane. The city hosts a significant amount of various theatrical, artistic and music festival events on a regular basis.
Investment Highlights
- Well located in Lismore main thoroughfare
- Local region underpinned by hospital and university trade
- Stable Monday – Friday trade reflecting local business drivers
- Future redevelopment plans for expansion of operations
- The Motel is only 7 years old reflecting minimal CAPEX requirements
Key Metrics – Gateway Motel
|
Purchase Price |
Rooms Acquired |
Avg. price per room |
|
$5.4 mil * |
34 |
$158,824 |
|
Approved LVR |
Forecast EBITDA |
Forecast ROI |
|
61% |
$520,000 |
9.63% |
|
Avg Room Rate |
FY2018 Revenue |
Avg. Annual Occupancy Rate |
|
60% |
$1,354,000 |
57.07% |
* Excludes transaction costs
Lismore also ticks a lot of boxes when it comes to investment – it is a university city; has two health precincts and the region’s major hospital; vibrant CBD and retail precinct; and it is also a regional sporting centre attracting international tournaments. A core part of the Fund’s strategy is the expansion of assets under ownership and management.
It will enable us to better leverage operational efficiencies. Part of this is the establishment of some criteria which we utilise to make quick assessments of potential properties and assets to identify if they fit the Fund’s strategy.
1.
Acquire
properties + businesses with high value-add potentital at below replacement value.
2.
Upgrade and
reposition the asset, focusing on cost effective improvement with high marginal benefits.
3.
Refine overall
operating procedures and implement new technologies to increase operating leverage.
4.
Sell motel on improved performance & yield compression as part of a portfolio or as individual assets to maximise returns.