Popular Melbourne pubs hit the market as hotel prices soar

And in Cheltenham, the Tudor Inn is being offloaded just three years after its owner bought it for $15 million.

Melbourne’s pubs rarely fetch the eye-watering prices achieved in NSW and Queensland, but sales and lease activity is quickly reaching similar levels seen north of the border.

Big super property player ISPT has put one of the CBD’s oldest pubs up for lease. Oddfellows Hotel at 33-35 Little Lonsdale Street is on Madame Brussels Lane in the once notorious Little Lon district.

The 562 sq m building has a rooftop terrace and laneway beer garden – not what it would have been called in 1853 when the building was completed, said Fitzroys’ James Lockwood and Franklin Gikas who, with Mitchell Humphreys of Future Proof, are handling expressions of interest.

Tudor Inn

In 2021, there was a string of bumper pub deals, one of which was the Tudor Inn in Cheltenham. Pub landlord ALE – now owned by Charter Hall and super fund Hostplus – sold the 155-year-old pub to Golden Sun Investments for $15.66 million on a tight 3.79 per cent yield.

Now Golden Sun is putting the 2152 sq m pub at 1281 Nepean Highway back on the market just three years later.

Tudor Inn boasts a long lease, with options, to Endeavour Group’s ALH Group, and comes with a slew of bars and lounges, a BWS bottle shop, TAB and 56 gaming machines. Land tax is included in the income of $687,000 a year.

Stonebridge Property Group agents Nic Hage, Rorey James and Kevin Tong are handling the listing.

Melbourne pubs are currently returning yields of around 5 per cent, which would equate to a sale price of around $14 million.

Cremorne’s Harlow

Harlow, the Cremorne pub once known as the Great Britain Hotel or the GB, is also on the market.

Hospitality veterans Mark Robertson and Will Studd paid $3.4 million for it in 2012.

The hotel at 447 Church Street is leased to another giant pub business – Australian Venue Co – which recently splashed $3.7 million on a renovation.

The 1100 sq m building is on a 485 sq m corner site in Silicon Yarra, the city’s tech hub, and rocks a rooftop bar and a split-level beer garden.

AVC’s lease expires in 2039 but includes two 10-year options. It returns $516,785 a year in rent.

Fitzroys’ Paul Burns and Chris James are running the campaign and are expecting a yield of around 5.5 per cent, which equates to a price of about $9.5 million.

Coppersmith Hotel

Also on the market, in the equally pub-rich suburb of South Melbourne, is the Coppersmith Hotel at 435 Clarendon Street, near Albert Park Lake.

The pub was bought by West Australian publican George Bagios in 2005 for $1.6 million. Since then, Bagios has completely revamped the old pub and built a swanky Hassell-designed five-story boutique hotel at its rear.

The pub goes to auction on March 22 amid the F1 Grand Prix’s relentless revving engines.

It has a new 45-year lease and returns $325,000 a year. It is likely to fetch more than $7.6 million.

Cushman & Wakefield agents Alexander Leggo, Anthony Kirwan, Oliver Hay and Leon Ma are running the auction.

Meanwhile, Endeavour is selling a $40 million portfolio of Dan Murphy outlets, including the old Lyndhurst Club Hotel in East Brunswick.

Records show ALH Group Holdings bought the East Brunswick pub in 2007, paying $6.4 million.

Endeavour has a brand new 10-year lease on the 2158 sq m hotel with options but does not occupy the entire building. It’s located at the very top of Lygon Street on the corner of Albion Street.

The grand three-story pub has been closed for several years and the Dan Murphy’s business returns $262,234 a year in rent. An expected yield of 5 per cent puts the likely price at about $6 million.

Stonebridge agents Michael Collins, Tom Moreland, Rorey James, Kevin Tong are running the campaign as part of the agent’s first national portfolio sale for 2024.

Fresh listings

Two fresh listings in East Malvern and Camberwell will test the suburban office market, marked last year by an influx of businesses buying their own workspaces.

That reversed a 20-plus year trend of owner-occupiers selling up and leasing space held by investors. In 2023, 11 of the 16 suburban office deals worth more than $5 million were made by owner-occupiers.

Qanstruct bought 85-87 High St, Kew for $17 million; Pixel Technologies paid $23 million for 677 High St up the road; United Petroleum snapped up 465 Auburn Road, East Hawthorn for $17 million; and Harry the Hirer paid a bullish $29.75 million for 112 Trenerry Crescent, Abbotsford.

The pandemic’s radical shifts in people’s working habits has left offices empty which, combined with land tax charges, prompted investors to sell up. They’re still around but unwilling to risk their dough on vacant properties.

However, they could be keen on 1911 Malvern Road, a three storey 2160 sq m office offloaded by the family of late Autobarn founder Garry Dumbrell.

Records show they paid $9.5 million in 2015. It’s underpinned by a new eight-year lease to PNOinsurance and returns $980,000 a year. It should fetch more than $14 million.

Also hitting the market, and more likely to attract owner occupiers, is 693 Burke Road Camberwell.

That four-storey 1549 sq m building in the junction precinct is mostly vacant. Records show it last traded in 2022 for $11.43 million.

Like many properties which transacted recently, interest rate rises have eroded any increase in capital values and it’s expected to sell for more than $10 million.

Gorman Commercial agents Peter Bremner, Jonathon McCormack and Stephen Gorman are running the campaigns.

The owner-occupier trend continued at 117 Church Street, Hawthorn, where Lake Press Publishing bought a two-storey 526 sq m office for $3.8 million.

GormanKelly agents Nick Breheny, Will Kelly and Robert Kelly did the deal.

Strand shopping

Johnson Zhang’s APH Holding has gotten out of the Geelong’s Pakington Strand shopping centre investment with a slim loss, selling to a Melbourne private investor for around $31 million, on a yield of about 5.5 per cent.

APH Holding’s associate in Australia, Bai Fu Xin, paid $32 million in 2016 – a yield of around 5.2 per cent.

The 5317 sq m Woolworths supermarket and 13 shops return $1.7 million a year in rent. They’re on a huge 20,984 sq m site. Colliers’ agents Tim McIntosh and James Wilson negotiated the deal with Stonebridge’s Kevin Tong and Justin Dowers.