The race to get a business foothold in Sydney's booming west has seen the Marlow family pay $16.5 million for the Peachtree Hotel in Penrith from ASX-listed property developer Boyuan Holdings.

The high price reflects the development potential of "The Peachy" as well as the pub's extensive catchment area. The new owners said they wanted to make it a family friendly pub, not a nightclub.

It was a quick turnaround for Boyuan Holdings, which bought the pub in October last year for $15.5 million from long-time owner Colin Parras.  It represented about an 8 per cent annualised return for the developer.

The pub sits on 10,550 square metres at the busy Mulgoa Rd and Peachtree Rd industrial park, adjacent to Bunnings and opposite what is thought to be the second-busiest McDonald's in Sydney.

The adviser on the deal, Ray White's Asia Pacific hotel director, Andrew Jolliffe, said the pub sector was one of the busiest in the national property market, with two floats coming this year from the Moelis-backed Redcape and the KKR-funded Australian Venue Company, which is looking at pubs owned by Wesfarmer's Coles group.