The elegant Clifton Hotel in Melbourne’s east is being sold by receivers out of Jon Adgemis’ floundering Public Hospitality portfolio, offering a rare property and hospitality play in the southern capital.
Public Hospitality was formed in 2021 by the former KPMG banker. During COVID the company rapidly expanded, accumulating over twenty pub assets, primarily in Sydney, touting ambition to turn urban pubs into multi-purpose accommodation-based precincts.
One of Public’s early acquisitions was the once-thriving Clifton, for around $8 million, on a high-profile corner of upmarket Kew, around five kilometres outside the Melbourne CBD.
The group executed a major refurbishment and explored further expansion plans. Mid-2023 it reopened boasting a new restaurant, Puttanesca, in partnership with acclaimed chef Guy Grossi’s Grossi Group.
But plagued with both construction and debt headaches largely stemming from the pandemic, lenders began to circle and in 2024 Public was forced to secure a $400 million refinancing agreement with Deutsche Bank to stay alive.
Earlier this year the Grossi family broke ties with Public and Puttanesca, telling Good Food they “don’t share the same business values”.
It’s been reported the ATO claims it is owed $162 million by Adgemis, as he attempts to avoid bankruptcy through a personal insolvency agreement while simultaneously being criticised for maintaining a lavish lifestyle, living in a Bondi apartment said to be leased for more than $60K per month.
Operator Linchpin, which claims no affiliation with Public but has been manning many of its repossessed venues, is understood to have this week walked from the Clifton, and the hotel is being run under management.
On offer is opportunity to purchase the hotel freehold and business, the sale providing option for vacant possession.
A boon to its flexibility is the more than $350K annual revenue derived from the digital rooftop signage overlooking bustling Kew Junction, intersecting High and Denmark streets and Studley Park Road.
The 643sqm site is zoned Commercial 1, facilitating future development potential (STCA). Public had initiated plans for a 108-room tower above the Clifton, which was built in 1868.
Pundits expect the freehold and operation will fetch offers north of $8 million. Records show multiple caveats on the sale, including long-time nemesis of Adgemis, businessman Richard Gazal, and consultancy Belgravia Group.
New York-based Muzinich & Co appointed FTI Consulting in 2024 to be receivers on five Sydney pubs under the Public Hospitality banner, taking control of The Strand and The Exchange in Darlinghurst, The Norfolk, Camelia Grove Hotel and Oxford House. Several of these have now sold.
Other lenders have forced sale on further Public assets, July bringing transactions on both the Town Hall Hotel in Balmain for nearly $10 million, and the former ‘Three Weeds’ in Paddington for around $20 million.
Receiver and manager FTI Consulting has now appointed HTL Property’s Scott Callow, Andrew Jolliffe and Sam Handy to sell the Clifton Hotel via an Expressions of Interest process closing Thursday, 11 September.
Finding Melbourne freehold hotels has become “increasingly difficult” and starved of options agents expect interest from buyers nationally, particularly given its prime location and historic potential.
“Following the most recent refurbishment, The Clifton Puttanesca was launched to market and became the immediate favourite of many people from Melbourne’s inner east,” reports Callow.
