Hawthorn Football Club sell WestWaters Hotel to Oscars Hospitality in $85m deal

The pub sale will slash Hawthorn Football Club’s exposure to gaming with its president Jeff Kennett describing the deal as a ‘significant’ move.

WestWaters Hotel & Entertainment Complex has sold for $85m to Oscars Hotels.

AFL powerhouse the Hawthorn Football Club has made a step away from gaming and will reap hefty returns from the record-breaking sale of the WestWaters Hotel & Entertainment Complex in Melbourne to the expanding Oscars Hospitality Group for $85m.

The football club sold the leasehold interest in the pub, alongside the private investors who held the freehold interest, with Oscars buying both components.

While the sale profit split is yet to be disclosed the dramatic move was hailed by Hawthorn president Jeff Kennett as a “significant decision” for the club as part of a long-term shift away from gaming revenue.

“The financial settlement will help establish a Future Fund that, with the continued support of members, will secure Hawthorn’s future as an independent, sustainable and progressive club,” he told members.

Hawthorn will pour the proceeds into the new vehicle to set itself up for coming years.

“Given the sale, the club will use the capital generated by this Future Fund to replace the revenue previously made by the venue,” Mr Kennett said.

Mr Kennett has previously defended the club’s pokie machines, but the club has been working to diversify its asset base in recent years in preparation for the WestWaters sale.

A lot of the money made from the WestWaters machines was also reinvested back into the hotel and entertainment complex, including 98 accommodation rooms.

The club still owns the Vegas at Waverley Gardens in Mulgrave.

For Oscars, it is the second big purchase in just a week with the once low-profile company also buying Casino Canberra in a $52m deal.

The WestWaters Hotel deal was brokered by JLL Hotels & Hospitality. Under the deal, the freehold interest was sold by local private investors with the leasehold interest exited shortly thereafter by Hawthorn.

The sale is Victoria’s highest ever recorded pub sale, trumping last year’s record-breaking regional deal in Bendigo’s All Seasons Hotel at $54.5m, also acquired by NSW-based capital in Redcape Hotel Group.

Occupying a commanding 7,000sq m site within the heart of the Caroline Springs retail precinct, the fully integrated entertainment complex incorporates 98 guest rooms under the ‘Mercure’ brand, a large bistro and restaurant, and sports bar with TAB, license to operate 90 gaming machines, conference and wedding facilities, indoor heated swimming pool, spa & sauna and extensive on-site parking.

“Within the past six months alone, we have witnessed over $180m of NSW-based capital investing in the Victorian industry, across three of the most significant hotel transactions to ever occur in this state,” Mr Connolly said.

“Our national team are at the forefront of this strategic capital entry with numerous groups, as significant NSW stakeholders come to understand the Victorian gaming legislation and operating models.”

The sale follows a recent influx of interstate capital into the Victorian pub space, historically dominated by a number of large generational family groups, with most predicting this trend to continue.

“We are representing a significant weight of capital moving from NSW to Victoria and similarly South Australia, as a natural geographical expansion for operators requiring a national footprint as a response to the supply challenges in an ever-tightening NSW hotel market,” Mr Musca said.