Merivale's Justin Hemmes adds Hotel Centennial to portfolio

Hotelier Justin Hemmes has bought the Centennial Hotel in Sydney's eastern suburbs as his commercial property splurge continues.

The reputed $15 million purchase comes after recent acquisitions of the Royal Hotel in Bondi, the Vic on the Park in Marrickville and Collaroy's beachfront hotel.

Hemmes also recently spent nearly $9 million on a commercial kitchen to service his growing portfolio.

Ray White's Asia Pacific director of hotels Andrew Jolliffe secured the off-market sale of The Hotel Centennial without formal price disclosure.

Jolliffe has now sold in excess of $1.75 billion in hospitality assets in the past five years.

Jolliffe has long espoused the view that market conditions for A-Grade hospitality properties enjoy strong favour and tightening yields.

"We've been both liberal and robust in our view over the past 24 months that the spread between cost of funding and yield for A-Grade hospitality assets is well placed to contract further next year" he said.

"The fundamentals are all pointing to this outcome, and the argument supported by astute hotel investors, by virtue of deed, is illustrative of this market response" Jolliffe concluded.

The Hotel Centennial is a landmark double storey Eastern Suburbs Hotel occupying a 780 sqm Oxford St location opposite Centennial Park.

lt was sold by the Medich family, who recently sold the Woolloomooloo Bay Hotel, The Woolwich Pier Hotel and Mosman's Buena Vista Hotel.

The Medich family, via their Halcyon Hotels vehicle and headed by Anthony Medich, acquired the hotel in 2014 and undertook substantial renovations; consequently attracting clientele from both the broader Eastern Suburbs; as well as the design, art and fashion industry.

"Like a handful of other iconic hotels, The Hotel Centennial is a very valuable piece of Sydney commercial property, and for decades has been a favoured meeting place for local residents and visitors to the area," Jollifee said.

"We are delighted to have again enjoyed the Medich family's trust with such a valuable asset, and feel equally pleased to have matched this famed property with such an appropriate suitor in Justin Hemmes."