A similar strategy has been successfully adopted by listed rival Hotel Property Investments (HPI), which has partnered with Australian operator Venue Co to buy seven ads so far this year.
In addition to the acquisitions, ALE hopes to record rent increases thanks to the positive outcome of an ongoing litigation involving a cluster of Victorian properties. This issue should be resolved before the end of the year.
Further, he hopes to negotiate significantly higher rents with Endeavor in 2028 when uncapped rent reviews are expected to take place – independent appraisers estimated ALE’s portfolio to be 36% sublet.
Reflecting the increased demand for pubs in the private market, ALE recorded a gain of $ 141.3 million on its strong portfolio of 78 pubs, including a gain of $ 90 million, or 7.5%, since December .
ALE also took advantage of favorable market conditions to sell six non-core properties for $ 73 million at a 24% premium over book value and with a weighted average return of just 4.4%.
Consistent with these results, the average returns of ALE’s entire portfolio, which includes the Crow’s Nest hotel on Sydney’s North Shore, the New Brighton hotel in Manly and Young & Jacksons in Melbourne, fell 32 basis points since December to 4.58 percent.
The group said it would pay an annual distribution of 22 per share, up 2.3% from the 21.5 paid in the previous year.
Macquarie Research said ALE’s results were in line with its expectations, as were forecasts for fiscal 2022.