The Merewether Surfhouse in Newcastle – one of the city’s most celebrated waterside venues – is available for the first time since its inception.
In the last days of 1989 an earthquake registering 5.6 on the Richter scale shook the city of Newcastle, killing 13 people, injuring around 160 and becoming one of Australia’s most serious natural disasters as the damage came to total an estimated $4 billion.
The quake also severely damaged the historic art deco bathing pavilion on Merewether beach, built circa 1937.
Efforts to restore or salvage the structure came and went as it languished and disintegrated beside the Pacific. In 1995 it was declared unsafe and boarded up.
A consortium calling themselves Sailors’ Rock, led by local property developer Keith Stronach, secured approval to redevelop the crown land site along with a 50-year lease from Newcastle City Council. In 2011 the impressive new three-level $5 million Merewether Surfhouse opened to the public.
Sailors’ Rock sub-leased operation of the venue to a group steered by pub veterans Tony Green and John Tierney, who previously ran the Royal Hotel in Paddington and The Clock in Surrey Hills and still hold title at the Pontoon Bar in Cockle Bay.
They have run the Surfhouse since its opening, joined by Morris Green and Mark Swadling. In 2018 the operators purchased the original ground lease from Sailor’s Rock for $12 million.
Over the past 15 years the pub has become one of the area’s landmark venues, boasting a 2,277sqm trading footprint and spectacular views overlooking Newcastle’s Merewether Beach.
The offering includes the Beach Bar – open daily for breakfast, the Kiosk café, Surfhouse Restaurant, and function spaces on the second level catering to up to 350pax, plus multiple outdoor areas. Across departments the business generates north of $10 million in annual revenue.
A stunning structure within a thong-throw of sand and breakers, the pub can be rightly associated with the likes of Byron’s Beach Hotel, Manly’s Hotel Steyne, Merivale’s Coogee Pavilion or The Collaroy, or Glenn Piper’s Beach Hotel at Merewether, bought in 2022 for $40 million.
Poised to follow in such esteemed footsteps, the Surfhouse is perhaps best suited to a larger group equipped to optimise its potential.
The greater Newcastle area continues to attract capital seeking growth, as seen in Redcape’s recent purchase of a swag of six pubs and a QT Hotel from Iris Capital.
With 35 years remaining on the lease and a “peppercorn” rental agreement with council, the expansive leasehold is expected to fetch around $25 million.
The ownership syndicate has engaged HTL Property’s Andrew Jolliffe and Dan Dragicevich to conduct an international Expressions of Interest campaign, expecting significant interest in this “rare trading opportunity”.
“Hospitality players are drawn to Newcastle for its proximity to Sydney and the Hunter and growing infrastructure, including the international airport and universities,” says Dragicevich.
“But few things compare with a beachside pub when it comes to catering to lifestyle.”
Jolliffe adds that the Surfhouse warrants a place amongst the revered list of east coast beach icons.
“Impeccably constructed and promoting uninterrupted views of the most stunning coastline, this multi-level hospitality asset is A-grade in every sense.”
