It is the first time in 35 years that the Lord Nelson Hotel has been offered for sale, with the existing owners citing the potential for growth as a key motivation behind the sale.
Current owner Blair Hayden said “We truly love this pub however, after 35 years, we simply don’t have the energy or the resources to take the business to the next level, but we have no doubt that someone will.”
The Lord Nelson Hotel is Sydney’s oldest continually licensed pub, and last sold for $750,500 back in 1986. The pub, brewery and beer brand are now expected to attract bids in excess of $35m.
Hayden told The Shout that the decision to sell was not impacted by Covid at all, but rather part of a long-standing agreement with business partners that when Hayden was ready to move on, the pub would be sold.
Hayden reiterated that they had achieved much to be proud of, maintaining the pub’s condition over 35 years and pioneering the craft beer movement in Australia.
“There are countless opportunities to expand into International markets and to further our already exciting relationships in Australia, including as the bespoke beer provider for Carnival Cruise Lines” Hayden continued.
The approaching return of cruise ships to nearby Circular Quay is an important factor in Lord Nelson’s outlook, with the pub auspiciously located equidistant from the Quay, and the entertainment and dining centre of Barangaroo. With Barangaroo forecasted to attract 20million visits a year, The Lord Nelson can expect an increase in foot-traffic.
The offer campaign will be managed by JLL Vice President Kate MacDonald and Managing Director John Musca.
MacDonald said: “We feel quite honoured to bring such an extraordinary asset and brand to market and feel a real sense of responsibility to ensure that the Lord Nelson legacy lives on in Sydney.”
‘The Lord’, as the pub is locally known, presents a unique opportunity to the would-be buyer, as its cellar contains a fully functional brewery. The pub will be sold alongside the Lord Nelson’s popular beer brand of the same name.
This brand includes the ‘Three Sheets’ Pale Ale, which represents approximately 90 per cent of the brand’s craft beer sales. Lord Nelson was an early entrant into the Australian craft beer market, with ‘Three Sheets’ launching in 1986 as one of the first Australian craft beer pales ales.
The current owners believe that the Lord Nelson would be well suited to ownership from a larger brewer who could expand the brand’s distribution, or a larger pub group, who could implement vertical integration of the Lord Nelson’s beers, increasing profits.
As MacDonald notes “Everywhere I go, I see the ‘Three Sheets’ Pale Ale logo on taps.”
“The sheer volume of sightings I have personally experienced since our appointment to this mandate has truly astounded me, and yet, it is still the result of a shackled production chain and marketing program. Imagine the possibilities.”
An Ibis World report published last month forecasted that the Australian Craft Beer trade could generate as much as $1.3billion annually within the next five years, a 30 per cent increase on existing figures.
And recent activity in the sector is suggested as indication of the industry’s health by Musca: “The recent sale of the Stone & Wood Brewing interests to Lion Nathan for $550m following the acquisition of Balter Brewery by Carlton United Breweries for a mooted $200m has highlighted the growing global interest in craft brewing representing an estimated six per cent of the total beer market in Australia and growing.”
“Having that underpinned by a very special brick and mortar hotel property in a historical context is a very special offering indeed” said Musca, reaffirming the Lord Nelson’s unique proposition to buyers in this high value market.
In a Facebook post to followers, the Hotel’s team announced the sale “with heavy hearts, but also with real hope for the future.”
“This decision has not come easily, but Blair and his partners have been at the helm for each of those 35 years, and it’s time to allow this icon to pass to new hands.”
Regarding potential buyers, Hayden said “We have an idea of the ideal buyer, but we hope the new custodian will cherish the building as we have. We were pioneers of craft beer in Australia, and we hope the new owners will grow the brand.”
The Lord Nelson and JLL are accepting expressions of interest from both Australian and International buyers. Bids will close on Tuesday 7 December 2021.