Adelaide developer George Kambitsis has bought the heritage Griffins Head Hotel at 34–40 Hindmarsh Square for $8.55 million, next door to the office his group developed at 150 Grenfell Street. The seller had held the pub for 24 years after paying $1.1 million.
The deal shows the appeal of buying the site next door: it gives an owner control of a wider CBD holding, even when there are no immediate plans to redevelop.
The deal at a glance
- Asset: Griffins Head Hotel (The Griffin), 34–40 Hindmarsh Square, Adelaide SA
- Price: $8.55 million, sold as a freehold going concern
- Site: 680 sqm, about $12,574 per sqm
- Yield: about 5.5 per cent on estimated net income of $471,464
- Buyer: George Kambitsis (Kambitsis Group)
- Seller: N Hassoun Nominees, owner for 24 years
- Agents: Savills (Sam Alexander, Nicholas Lower); MRS Property acted for the buyer
175 years of hospitality
A pub has stood on the site since 1850. The current building dates from 1886, built for Arthur Waterhouse, son of earlier owner Thomas Greaves Waterhouse. It traded as the King William and the General Gordon before becoming the Griffins Head in 1988, then The Griffin after a major fit-out in 2012. The City of Adelaide listed it as a local heritage place in 2001.
A going concern with income
The four-level hotel has a bar, bistro and gaming room with 20 machines. It is operated under a lease, which will continue, so the new owner gets a steady return from day one.
The neighbour advantage
Kambitsis Group developed and owns 150 Grenfell Street, the former Internode building, which was redeveloped as RAA's Adelaide headquarters. RAA moved its CBD operations out in June. Owning both properties gives the group a larger, more flexible holding in the East End. The site is zoned Capital City with a 53-metre height limit, although the buyer says there are no immediate development plans.
Adelaide's East End on the move
Hindmarsh Square and the East End are busy with investment, from student housing on North Terrace to hospitality and office upgrades. Buying adjoining sites is a common strategy for developers who want options in a precinct that is changing quickly.
Pubs as investments
Leased pubs have become popular with private investors because they combine strong land holdings with income from established operators. A lease to an experienced operator means the landlord does not run the business but still benefits from a busy trading venue that keeps the property in demand.
In a CBD, the land underneath adds another layer of value. A 680 sqm corner site with a 53-metre height limit in a growing precinct is the kind of holding that can be redeveloped one day, even if the current building stays in use for years to come.
What it means for the market
- Heritage pubs with secure leases remain strong investment assets
- Developers are paying for control of adjoining CBD sites
- Land values in Adelaide's East End reflect long-term upside
Lessons for owners and developers
- Know your neighbours: the most motivated buyer is often next door
- Heritage adds character: listed buildings can anchor future schemes
- Show the bigger picture: combined-site concept plans help owners and partners see the potential of an assembled holding
What to watch next
Watch for a new tenant at 150 Grenfell Street and any future plans for the combined holding.