The Vertua Opportunities Fund (Fund) is pleased to announce the successful acquisition of the Lismore Gateway Motel (“the Gateway”). The settlement of the acquisition occurred on 1 July 2019.
The Gateway is a four star, 34 room motel accommodation, with a fully licensed restaurant and bar, situated in a prime location with close proximity to Southern Cross University, Lismore Base Hospital, St Vincent’s Hospitals and the Lismore Regional airport. By car, the Gateway is only twenty minutes from Byron Bay, sixty minutes from Coolangatta, and two hour thirty minutes from Brisbane.
This Asset also presents a development opportunity that is in line with our overall strategy of the Fund. The acquired adjoining land of 1,731m2 includes a development application for an additional 36 room motel.
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.
Since our last market update on 14 June 2019, the Fund has successfully raised $2.375 million. We continue to invite new and existing investors to participate in our raise of up to $10 million.
If you would like a copy of the Information Memorandum (IM) outlining existing assets, information regarding a new acquisition and the Fund’s overall investment strategy, please don’t hesitate to email Olga (olga@vertua.com.au) to coordinate a suitable meeting time.