In Red Tape by Clyde Mooney

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Just days after taking the keys, Pelathon will part with its newly-acquired Courthouse Hotel after Council determined they want it more.

The listed Lantern Group (LTN) first discussed parting with the landmark Cairns pub last year. Built from the city’s former Courthouse, it is located between two other heritage buildings – the former Cairns Public Office, now Cairns Regional Art Gallery, and the former Mulgrave Shire Council building.

Cairns Council has plans to turn the three sites into the hub of a community cultural and arts precinct, furthering its visions for Cairns to be the “arts capital of northern Australia”.

In June 2016, LTN officially listed the pub for an on-market national campaign through CBRE Hotels. Agents at the time spoke of appeal to a “wide range of purchasers” due to its historic and local significance.

The Expressions of Interest campaign attracted plenty of contract offers, closing after five weeks on 13 July.

On 21 July LTN announced it had entered into contracts for the hot market sale, achieving a 28 per cent premium to book value of $6.25 million to Jaz Mooney’s Pelathon Management Group.

Mooney cited plans to actively engage with the local Council and community to reinvigorate the historic building and hotel. Completion was expected toward the end of October.

But mid-October, Cairns Council sprung into action, issuing a press release on its “decision to implement our right to acquire the property” for its plans for a community centre, and claiming it had not had a chance to be part of the sale process.

“We had intended to purchase the property through regular commercial channels but were never given the opportunity to do so,” said Mayor Bob Manning.

In following days a surprised LTN updated shareholders with news of the “unexpected media release” and proposal to compulsorily acquire the Courthouse Hotel, noting it has “not received any formal notification” from Council regarding its announced proposal.

After three more weeks of uncertainty, LTN announced on 7 November the sale to Pelathon had been completed. Pelathon have since taken possession and begun planning for changes.

However, the Council plans were not waylaid by the change of ownership, and rumours the compulsory acquisition would continue emerged.

Council responded to questions from PubTIC as to its part in the Expressions of Interest process.

“Council resolved at its Planning and Environment Committee meeting on 13 July to make a formal EoI and it was lodged on the same day,” responded a spokesperson. “The vendor confirmed receipt at the time.

“The EOI process had not been resolved when an announcement on the sale occurred.”

While Council maintains it didn’t expect special treatment in the sale process, it declined to comment on the nature of the same-day EOI submitted, what due diligence was done, or the price offered except to confirm it would be “subject to market forces”.

Council today confirmed that its plans to compulsorily acquire the Hotel will go ahead.

“The acquisition process is continuing” the spokesperson told PubTIC.

Cairns Council enjoys a pivotal role in the development of the region, with no less than nine divisions and ten Councillors (including the Mayor) for a population of nearly 150,000 people*.

“Traditionally, councils have provided services such as roads, water supply and sewerage, but more and more they are becoming involved in the social, economic and cultural development of their communities, and in improving local living environments,” says the website.

PubTIC contacted Mooney about his new pub being acquired, but he declined to comment on the ongoing situation.



*Brisbane Council has 27 councillor positions plus the Lord Mayor, in a population of nearly 2.3 million, making 1 Councillor per 85,185 people. The ratio in Cairns is 1:14,799

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