Impact Investment Group pays $70m for Byron Bay’s Beach Hotel

A FUND manager has secured one of Australia’s best-known pubs – a Byron Bay landmark developed by “Strop” Cornell from Crocodile Dundee proceeds.

The Beach Hotel dominates a central beachfront block in Byron Bay.

A MELBOURNE-based boutique fund manager has secured one of Australia’s best-known pubs with the aim of regenerating the so-called “heart and soul” of Byron Bay.

Impact Investment Group paid $70 million in an off-market deal for the Beach Hotel, which was developed by comedian Paul Hogan’s business partner, John “Strop” Cornell almost 30 years ago, mainly from the proceeds of their film Crocodile Dundee.

An IIG spokesman said the group saw strong potential to regenerate the “heart and soul” of Byron Bay with a strategy focused on achieving bold green and social-impact initiatives over three to four years.

“We’re looking forward to settling this transaction in six months’ time,” he said.

“It’s a great hotel, and we’ve already made a lot of progress planning our environmental upgrades and how we’ll work with the operator and locals to deliver real positive impacts for the Byron Bay community.”

IIG is a private investment company founded by Berry Liberman and her partner, Daniel ­Almagor, with the aim of providing competitive returns while also generating social and environmental value.

CBRE Hotels’ Daniel Dragicevich, who struck the deal with Wayne Bunz, said there were few similar landmark beachside hotels in Australia in terms of scale and location.

“The irreplaceable oceanfront site, lease covenant, future development and reconfiguration upside and aspirational nature of the hotel provide a compelling mix for astute investors such as IIG,” he said.

The property was previously owned by Melbourne businessman Max Twigg, who paid $44 million for the freehold of the hotel in 2007 following the sale of his waste management business.

Known as the “top pub” to locals, the Beach Hotel is on a 4585sq m site at the apex of the commercial precinct of Byron Bay. It is currently leased to Melbourne pub industry identity John van Haandel on a 10-year term, with a further 10-year option.

The hotel sports several bars and bistros overlooking Byron Bay’s surf, as well as conference facilities and 25 hotel rooms.

Based on the current rental income, the sale price represents a 6.3 per cent passive investment return.

IIG has more than $730 million in existing assets and those under construction, with a mandate to shift capital towards investments that generate social and environmental value while delivering excellent returns for investors.

This year IIG bought its second commercial building at the Brisbane Showgrounds redevelopment, paying $140 million for Lendlease’s 5 King building, which will be Australia’s tallest engineered timber building at 10 storeys.