Newcastle beachfront trophy the Merewether Surfhouse is in new hands for the first time, as waterfront guru Ben May adds it to the May Hospitality collection.
The historic art deco bathing pavilion on Merewether beach built around 1937 was one of many structures severely damaged in the 1989 Newcastle earthquake, registering 5.6 on the Richter scale, killing 13 people and injuring another 160 as it created a damage bill totalling roughly $4 billion.
Efforts to restore the site failed and in 1995 it was declared unsafe and boarded up.
Local consortium Sailors’ Rock, led by property developer Keith Stronach, secured approval to redevelop the crown land site and locked in a 50-year lease from Newcastle City Council. In 2011 they launched the impressive new three-level $5 million Merewether Surfhouse.
Sailors’ Rock sub-leased operations to a group steered by pub veterans Tony Green and John Tierney, later joined by Morris Green and Mark Swadling. In 2018 they purchased the original ground lease from Sailor’s Rock for $12 million.
Over the past 15 years the pub has become one of the city’s most celebrated waterside venues, blessed with spectacular views overlooking Newcastle’s Merewether Beach.
In July Green and Tierney put it to market for the first time since its inception, the large 2,277sqm trading footprint, generating over $10 million in annual revenue, described as best suited to a larger group equipped to optimise its potential.
Still holding 35 years on the lease, with a “peppercorn” rental agreement with council, the expansive leasehold was expected to fetch around $25 million. But the final sale price is said to have “exceeded initial expectations” and is understood to have reached $27 million.
“My first job in hospitality was working for the vendors, Tony Green and John Tierney, at The Royal in Paddington and then The Greenwood North Sydney,” pronounced May. “As such I have enormous respect for what they have done over the years.
“We’re very excited to dive into Newcastle and get to know the locals. It’s similar to Burleigh in so many ways.”
The acclaimed May Hospitality portfolio already counts the highly successful Burleigh Pavilion at Burleigh Heads, and Terrigal Pavilion at Terrigal. He previously held the keys at the iconic Manly Wharf Hotel before selling to Artemus Group in 2024.
The group has wasted no time looking to optimise, seeing builders at the Surfhouse, which could be destined to further the Pavilion brand at Merewether.
Classed in the same league as Byron’s Beach Hotel, Manly’s Hotel Steyne, Merivale’s Coogee Pavilion or Glenn Piper’s Beach Hotel at Merewether, the Surfhouse is likely to further its already impressive reputation.
“May Hospitality has rewritten the playbook on how to fit out, operate, and enhance the patron experience in venues that offer competitive advantages that can’t be replicated,” says HTL Property’s Dan Dragicevich.
“With a reputation for creating institutions in Manly, Burleigh and more recently Terrigal, they are sure to further enhance the already burgeoning visitation appeal of Newcastle.”
HTL CEO Andrew Jolliffe added that the interest generated in the opportunity to build on a legacy established by industry stalwarts was highlighted by the “depth of the non-traditional buyer pool we unearthed” in the sale campaign.
