KKR & Co could own St Kilda’s landmark Espy Hotel as part of Sand Hill Road sale
It reopened in 2018 with a brand new look after being shuttered for years — but Melbourne’s much-loved Espy Hotel is set to be sold once again. This is the Wall Street private equity titan eyeing off the landmark venue.
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Wall Street private equity titan KKR & Co is circling Melbourne’s much-loved Espy Hotel.
The move is part of a play by Australian Venue Company, which is headed for a $1 billion float.
Backed by KKR, the group is finalising a deal to buy Sand Hill Road, the owner of St Kilda’s Hotel Esplanade — better known as The Espy — for about $75 million.
Sand Hill owns a network of about a dozen pubs across Victoria.
They would be added to the 157-strong group of hotels that Australian Venue Company already owns. The company focuses on entertainment venues rather than the poker machine revenue that is the primary focus for many rivals.
Redcape Hotel Group, the only major listed pubs group, owns and operates 32 venues that are mainly gaming focused.
Through investment bank Citi, Australian Venue Company is now testing the appetite for its listing with offshore investors, and the impending deal with Sand Hill could help with the pitch.
Australian Venue Company has been expanding and last year bought a slice of the Coles pubs business.
KKR, previously known as Kohlberg Kravis Roberts & Co, took an 80 per cent stake in Bruce Dixon’s pub group, Dixon Hospitality, in mid-2017 for about $190 million.
It was renamed Australian Venue Company and expanded early last year.
The company now runs Coles’ 87 Spirit Hotels venues in Queensland, including about 3000 poker machines.
Coles is handling the bottle shops.
Sand Hill is a privately-owned, Melbourne-based hospitality group that was founded in May 2000 and has owned, developed and operated 12 different hotels.
It has sold some venues along the way and it overhauled The Espy.
The company’s first venture was the Commercial Club Hotel in Fitzroy, which it sold in 2003.
Sand Hill Road also sold The Loft in the CBD and the Heritage Hotel at Rockhampton in Queensland.
The company is about to undertake a sweeping refurbishment of the Waterside Hotel on the corner of Flinders and King streets.
It has a major presence in Richmond, where it owns and operates the Richmond Club Hotel, The Posty — a former posted office — and Holliava, all on Swan St, along with The Bridge Hotel on Bridge Rd.
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Its other venues are the Garden State Hotel in the CBD, the Terminus Hotel in Abbotsford and The Prahran Hotel in High St, Prahran.
Australian Venue Company has more than 30 venues in Melbourne, including The Imperial Hotel on the corner of Bourke and Spring streets, Beer DeLuxe at Federation Square and European Bier Cafe on Exhibition St.
— The Australian