HAMPSHIRE HOTEL CAMPERDOWN
We realised early in 1987 that asset values were very high and the yields on which you could sell assets was too low. We sold both the Lakes Hotel and Wentworth Avenue by the middle of 1987 and kept our funds in cash. We went overseas for 3 months to come back and assess investment opportunities. During our time away the stock market crashed in October 1987 and with it the bubble of asset values.
We were offered the Hampshire Hotel, which was under lease, with an option to acquire the freehold at a fixed price. We acquired the lease and immediately exercised this right and bought the freehold.
The Hampshire was a small hotel on Parramatta Road in Camperdown. The hotel needed to be cleaned and painted throughout. Clientele had drifted away and we had to improve the food and service to win them back. We also introduced pool tables and poker machines in the main bar. Once we got the hotel operational we leased it out, recovering our capital outlay and holding it debt free until the market for hotels improved.