Millbrook Income Fund recently raised $9m from our Wholesale investors to provide funding to a large property investment group focused on acquiring and repositioning established commercial properties through refurbishment, change in use and releasing.
The security property represents the old Town Hall Hotel in Balmain, NSW, which is being renovated by the borrower. The borrower has held the property for some five years as a strategic investment pending his intention to undertake the proposed refurbishment.
The refurbishment involves a basement of 99sqm, ground floor of 395 sqm; and two levels (level 1 of 380 sqm and level 2 of 99 sqm). The Hotel had earlier planned to be improved and operated by a separate bar and boutique hotel operator. The entire premises are now however to be leased to one of Sydney’s pre-eminent restauranteurs in Alessandro Pavoni who is the principal of a’Mare at Crown and Ormeggio at The Spit. Last year he was awarded the restaurant and catering Association of NSW Restauranteur of the Year. The lease shall have a commencing rental of $1.4m ex GST p.a.; on a 5 year term, with a 5 x 5 year options. The earlier rental being contemplated for the bar and hotel was $1.075m combined.
The Borrowers will complete the intended refurbishment/renovations on the subject property before the new tenant takes possession, which is anticipated to occur in December 2022.