Carving out a sizable 2,188-square-metre corner site on Military Road in Neutral Bay, The Oaks Hotel has long been considered one of the most emblematic pubs in Sydney (and easily one of the best in Australia). Now, for the first time in almost 50 years, the historic 135-year-old hotel is hitting the market as current owners the Thomas family seek expressions of interest at, or around, $175 million.
If successful, that would make The Oaks Hotel the most expensive pub ever sold in Australia, with the punchy price tag trumping the $160 million former Sydney Lord Mayor Nelson Meers received for The Crossroads Hotel in Casula earlier this year. The Oaks Hotel sale represents just how lucrative the hotel industry has been lately.
The Neutral Bay pub, best recognised for an expansive beer garden built around an 80-year-old English oak tree decked in fairy lights, has been part of the Thomas family since patriarch David “Taffy” Thomas and his mother acquired the lease from original owners Tooth & Co back in 1975.
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Over the years, Thomas has built the pub into a genuine behemoth, spanning Taffy’s Sports Bar, that aforementioned beer garden, Alala’s Cocktail Bar, a separated Bar & Grill restaurant, a gaming room with around 30 poker machines, extensive first-floor function spaces and an attached bottle shop – one of the best in the area.
“As in all real estate sectors the premier assets often only come to market once in a lifetime, which is even more prevalent in the highly protected hotel industry where assets of this scale and quality will simply never be approved or replicated again in high-end Sydney demographic locations,” said John Musca, Managing Director of JLL Hotels & Hospitality Group who are taking the pub to market.
“We’re fundamentally talking about one of the very best hotels in the asset class.”
Almost $2 billion has changed hands in the Australian hotel market over the past 12 months, aided by a solid rebound for the sector after suffering greatly during years of lockdowns. According to The Hotel Conversation, the past year has seen the largest exodus of generational hotel owners in almost three decades, with 50% of the last 20 transactions in the Sydney metropolitan area being generational owners basically exiting the industry – getting out of the game, so to speak.
Many are pointing to the Smorgon family’s recent acquisition of the newly reopened Continental Hotel in Sorrento, Victoria as a fine example of such generational shifts in the hospitality industry.
According to The Oak’s current General Manager, Andrew Thomas, the family has received a number of “unsolicited approaches” before deciding to move on and sell the property. Notably, the Thomas family will still remain in the industry as stakeholders of the Winston Hills Hotel and The Entrance Hotel.
If you happen to have a spare $175 million lying around you’ll need to start putting together that proposal soon. Expressions of interest for The Oaks Hotel will close at 4 PM (AEST) on Tuesday, September 6th — just over a month from now.
Anyone who picks this icon up as The Oaks Hotel goes on sale should also know that, due to the site’s generous mixed-use zoning and favourable planning guidelines, there’s potential for development of up to five storeys.