Woolloomooloo premises of Otto Ristorante and Kingsleys sell to global fund manager

The premises that house well-known Sydney eateries Otto Ristorante and Kingsleys Steak and Crabhouse on Woolloomooloo’s Finger Wharf have been acquired by global fund manager Aviva Investors Asia for $16.3 million. 

Aviva has acquired Lots 6 and 7, which houses Otto Ristorante covering 747 square metres of retail space, and Lot 8, home to Kingsleys Steak and Crabhouse, which measures 570 square metres. 

Michael Gilbert of Chesterton, who negotiated the sale alongside colleague Michael Stokes, told Property Observer Lot 5, the 540-square-metre premises of Manta restaurant, had been withdrawn from the market for the time being “while works are carried out that will increase the capacity of the restaurant and, naturally, the turnover portion of the rent”. 

Four strata retail lots had been listed for sale in July last year with expectations of about $25 million. 

“Looking back $25 million was possibly a tad optimistic, but all sides are happy at [a yield] of 8%,” Gilbert says. 

Gilbert and Stokes sold the premises on behalf of property investment syndicate Quantum Group, which valued them at $16.5 million in 2000. 

In late 2004, the leaseholds covering the four properties were transferred at $22 million to Tower Trust Limited, which replaced JP Morgan as custodian of Quantum’s property trusts. There were 80 members of the syndicate after its $22 million acquisition. 

A consultancy report compiled by Urbis in 2004 revealed that total turnover from the four restaurants rose from $15.3 million per year in 2001 to $21.7 million per year in 2004, equating to an average turnover productivity level of $12,400 per square metre. 

In a December 2007 investor presentation the properties were valued at $28.5 million, a 30% increase on the purchase price, with a gearing level of 58%.