2 X FREEHOLD HOTELS, ACCOMMODATION & A BOOMING BUSINESS

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NET PROFIT
$639,000 pa

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PRICE
$2,800,000

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STOCK
$90,000

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LOCATION
North West Regional

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REF NO
012578/21

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BROKER
Glenn McTaggart

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Hospitality
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012578/21

Key Features

  • Monopoly business with diverse income streams and solid profits
  • Profit from 2020 to 2021 up 30% with forecast profit for 2022 fy approx. $650,000
  • Mining industry booming and new lng plant being established in mt magnet
  • The only one-stop business in the region providing accommodation, restaurant, bar facilities and take-away liquor in one location
  • The meal and bar facilities include an 80 seat restaurant, 60 seat dining/function room, bar meals, sports bar and beer garden
  • Well located on nw highway as a stop-over to newman or port hedland
  • Currently no website or online booking system

GOLD MINE OF THE NORTH WEST - MONOPOLY HOSPITALITY & HOTEL BUSINESS

The offering of the Commercial Club and Grand Hotels provides an excellent opportunity to acquire a monopoly business with diverse income streams and solid profits.

Profit from 2020 to 2021 up 30% with the forecast profit for 2022 FY up to approximately $650,000.

The only one-stop business in the region providing accommodation, restaurant, bar facilities, and takeaway liquor.

The meal and bar facilities include an 80 seat restaurant, 60 seat dining/function room, bar meals, sports bar, and beer garden.

The business enjoys a very low vacancy rate with regular bookings from a diverse customer base including mining companies, transport companies, contractors, tourism, and travellers.

Accommodation comprises 33 self-contained, air-conditioned, ensuite rooms, staff quarters, and 2 managers' houses.

Excellent expansion opportunities with vacant land as part of the deal.

The Mount Magnet region enjoys 600,000 visitors per annum and injects approximately $200m into the local economy.

Located on the Great Northern Highway as a strategic stopover when travelling to Port Hedland or Newman.

Further mining and LNG development forecast for the region.

MORE ABOUT THIS BUSINESS

The business has continued to record increases in sales and gross profits from inception and on this basis, the owner sees no reason why this trend will not continue.

The continued growth in the Murchison/Pilbara region is forecast to continue which makes the business virtually recession-proof

Both the Commercial Club and Grand hotels are part of the fabric of Mount Magnet and enjoy a monopoly in the town

The business enjoys a very low vacancy rate with regular bookings from a diverse customer base including mining companies, transport companies, contractors, tourism and travellers

 

The current owners have been looking toward retirement and have not engaged in any promotional activities to grow the business.

The establishment of a website, marketing, social media presence, and a digital booking platform will almost certainly attract new customers

  • The Mount Magnet region enjoys 600,000 visitors per annum that injects approximately $200m into the local economy
  • Strategic stopover for travellers going to Port Hedland or Newman.

  • Further mining and LNG development forecast for the region
  • Mount Magnet is the Geo hub of the Murchison
  • Located on the Great Northern Highway

The one-stop-shop and a large diverse customer base ensure constant turnover and a low-risk business

The Owners are Retiring 

The current owners are in their 70s and it’s time to retire. The business is well placed for a new owner/s to take it to the next profit level.

Barriers to Entry

Aside from the significant capital requirements to establish a business such as this, a newcomer to the market hoping to compete with this business would face the following issues…

  • Obtaining another Liquor License in the town
  • High cost of construction and building

Current Year To Date Sales Are Up

With the expansion of the mining and LNG industries in the region, sales and bookings continue to increase across all sectors of the business

High Asset Mix in the Purchase Price

This business reflects a high percentage of the purchase price made up of freehold properties, tangible stock, and equipment. Compared to low asset businesses, this business reflects a lower risk and potentially delivers a higher bottom line profit through being able to minimize its tax by claiming depreciation as a non-cash expenditure item on its long-life equipment.

Limited Advertising & Promotion

The business is in the fortunate position it does not have any reliance on advertising to generate sales.  The present owner has opted not to actively market the business and this, therefore, represents one of the simplest and most direct routes to increased sales for a new owner – particularly if the promotions are aimed at expanding the client base into new facets of the industry

Low Hours By Owner

The present owner/manager opts to work part-time on a shared basis with another couple in a managerial and operational capacity. Their schedule of 4 weeks on and six weeks off, under their current structure allows the owners to work just over 20 weeks of the year. A new owner has many options and could easily restructure the business to take on more managerial tasks and less operational duties.

Profits Can Be Proven

The business has a complete set of verified accounts that clearly show its profitability and any addbacks that apply. The profitability of the business continues to rise on the back of increased activity in the region. The forecast for the 2021/2022 financial year is set to break through $650,000 net profit.

Low Competition

Commercial Club and Grand Hotel have limited competition in all categories of their business. From a one-stop hospitality business, the hotels have a monopoly in the town and the region with Cue some 80kms away from the next hotel

Key Features

  • Monopoly business with diverse income streams and solid profits
  • Profit from 2020 to 2021 up 30% with forecast profit for 2022 fy approx. $650,000
  • Mining industry booming and new lng plant being established in mt magnet
  • The only one-stop business in the region providing accommodation, restaurant, bar facilities and take-away liquor in one location
  • The meal and bar facilities include an 80 seat restaurant, 60 seat dining/function room, bar meals, sports bar and beer garden
  • Well located on nw highway as a stop-over to newman or port hedland
  • Currently no website or online booking system

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2 X FREEHOLD HOTELS, ACCOMMODATION & A BOOMING BUSINESS


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