Universal sold them to the MA Financial Taylor Square Fund in late 2020, which had ambitious plans to consolidate the prime city fringe site through repositioning and potentially redeveloping it into a significantly expanded hospitality offering.
But with the onset of COVID-19 and slow planning approvals during the past three years, the fund has opted to sell.
Chris Unger, managing director of MA Financial’s hospitality platform, said the original investment strategy was dependent upon favourable trading conditions emerging from the first COVID lockdown, and the anticipated resurgence of Oxford Street following the repeal of the city’s lockout laws.
“However, the precinct and surrounding area has taken an extended period of time to revitalise,” Unger said.
“While we are confident the precinct will thrive over the longer term, this combined with changes in the construction and funding markets has meant the timeframes associated with redeveloping the iconic site now sit outside the fund’s target investment horizon.”
He said the opportunity came up to sell to Virtical, which can now pursue its own repositioning strategy on a “different timeline and as part of a broader portfolio”.
Nick Lower and Tony Bargwanna of Savills Australia brokered the sale of the assets.
Lower, state director, hotels at Savills Australia, said the sale of Taylors Square, comprising the Kinselas and Courthouse pubs, “underscores the appeal of well-located operational pubs with solid property fundamentals”.
“Virtical’s acquisition of this prime property showcases their commitment to enhancing Sydney’s hospitality scene. Their reputation for adding premium opportunities to their portfolio is a testament to their vision and expertise,” Lower said.
Bargwanna, national director, hotels at Savills Australia, added the transaction is a clear indication of the ongoing confidence in Sydney’s pub market. It reflects the strong demand for assets that offer both operational success and the potential for future growth.
“Kinselas and Courthouse have long been cherished by the local and surrounding community alike. This transaction ensures the continuation of their legacy under Virtical’s capable stewardship,” Bargwanna said.
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