Hospitality

Australian Hospitality Landscape

Attractive asset class
Australian Pubs are large scale, defensive, cash-generative businesses underpinned by diverse revenue streams through food, beverage, accommodation, gaming, and retail. This diversity, combined with their role as community hubs, supports stable and recurring cash flows that perform throughout the economic cycle.

Several structural tailwinds reinforce the long-term investment case in pubs. Pubs have high barriers to entry due to a limited supply of hotel licences. Despite generating c$20b in annual revenue, the Australian pub market is highly fragmented. Of the c7,000 licenced venues nationwide, only c20% are corporately owned, presenting a significant opportunity for consolidation in the market. This shift is already underway with c$2b worth of venues trading hands in CY2025, up 40% on 2024, and higher than 2023’s $1.99b. Consumer preferences in Australia have increasingly shifted toward experiential spending, with hospitality benefiting disproportionately from this trend. Since January 2019, spending in the sector has grown by approximately 70%, materially outpacing other discretionary categories such as miscellaneous retail and apparel. This reflects a sustained behavioural change, where consumers are prioritising social and experience-led activities over traditional goods-based consumption.

Why South Australia?

Compelling Value Proposition
• SA hospitality assets trade between an 11–14% yield, representing a 300–500bps premium to eastern states freehold going concern yields.

Capital Inflows Increasing
• Interstate capital is recognising the value in SA hospitality assets, with Sydney-based Oscars Group deploying c$80m across two Adelaide transactions in CY2025, and Harvest Hotels deploying $100m in 2023-2024.

Stable Regulatory Environment
• SA has the tightest gaming regulation of any jurisdiction in Australia through load up limits, facial recognition, smoking bans, linked jackpot, max bet and payout limits.
• Gambling reforms in SA came into effect in December 2020 introducing Bank Note Acceptors and Ticket in Ticket Out technology, positively impacting state gaming revenue since this time.