By Andrew Starke
Listed pub operator National Leisure and Gaming (NLG) has defended a decision to ask its various landlords to buy dozens of poker-machine entitlements for the pubs it leases.
The group wrote to the owners of over twenty NSW pubs where NLG is a tenant late last month (April) requesting that they buy additional licenses.
Most of these properties are owned by listed pub owner Redcape Property Fund, which will need to stump up several million dollars if it complies with the request.
NLG hopes to increase its gaming machine numbers to the threshold of 30 per hotel.
“Put simply, NLG is relying upon an uncomplicated lease condition which provides for the purchase, by the landlord, of additional gaming machine entitlements for NLG’s utilisation,” NLG CEO, Andrew Jolliffee, told TheShout.
“We have been uncontroversially successful at operating gaming machines, and as such the lease condition and associated strategy to acquire more entitlements is consistent with sound business principles.
“Further, it is wholly within NLG’s interests and that of NLG’s landlord’s interests, to ensure that each business has the full use of every revenue generating opportunity, particularly where the gaming capacity is under resourced.”
Redcape is in the process of evaluating whether the additional licences would add value to the properties and will respond to NLG’s demand when it has reached a conclusion.
If the landlord refuses to provide the extra licenses then an arbitrator will intervene.
Poker-machine licenses have been selling for between $125,000 and $130,000 each but an order of this size could push the price far higher.
NLG venue the El Cortez Hotel in Canley Heights was first on the list of the top 200 gaming venues in NSW for the December quarter.
The venue has now held the top spot on the list, compiled by the NSW Office of Liquor, Gaming and Racing (OLGR), for six consecutive months after also securing the number one position for the September quarter.
Another NLG venue, the Eastwood Hotel, came in at number two on the list.