A group of hospitality veterans is reviving and reinventing both the Newmarket Hotel and the landlord rule book, embracing insightful investment.
Leisure Investment North Queenland (LINQ) Hotel Management is fronted by Richard Mraz, who arranged purchase of the freehold property from incumbent Toula Cassimatis in a fire-sale situation in September.
After several offers to buy falling through, the vendor and agents Cusack Real Estate were preparing to go to auction when a whirlwind inspection and offer from LINQ sealed the deal.
Ms Cassimatis was involved in a legal dispute with the former lessee since 2013, and the property was in poor condition. LINQ identified its “bones” as in line with their plans, and purchased with every intention of a top-to-bottom makeover and “full gentrification” of the pub, built in the 1930s.
The swift purchase and determined plans, including recent installation of 2.5 tonnes of solar panels on the roof, are the result of two years’ research by the Group and consideration of assets in Rockhampton, Bundaberg, Mackay, Cairns and Townsville.
Townsville was seen as particularly prime for success, with massive investment in infrastructure and residential development, and being a strategic stronghold of the armed forces.
Working toward staying involved with the business, FINQ will not run the pub, but seeks to optimise operations toward better profits for everyone.
“When I walked through, it was literally five minutes,” says Mraz. “I’d never seen the hotel before. I could see the structure of the building, the era, the vastness … it is actually a beautiful hotel.
“We’re going right through it. We’re looking at every aspect of the business. Power consumption is not just air-conditioning, it’s also in the cool room. How do we make them more efficient? We’re looking at every element, thinking ‘how do we put some capital in to get the running costs down?’”
Sub-tropical areas such as Townsville spend a fortune on power keeping things cool, but sensible investment in an old structure can also reduce labour and servicing costs, and more.
LINQ plans to stay close with the right operator, and negotiate a profit-share arrangement for rent. The thought is to capitalise on the benefits of the capital works, and allow a profitable business to be sustained even in lean times.
“What that means is that LINQ hotel management will actively be involved in the success of the hotel,” explains Mraz. “We’re not the passive freehold owner.
“We have to rebuild the business model from scratch, and the time is right to do that.”