RSL NSW has completed its $19 million “flash sale” of former sub-branch headquarters The Barracks to hospitality juggernaut Merivale – ahead of schedule – after a special resolution and new members’ voting rights nullified.
The Barracks, at 5-7 Barrack St, was home to the City Tattersalls Club, beneath the office of the Combined Services RSL.
Sub-branch President Bill Forsbey declared the association wanted to sell the “rundown building” and relocate to central Sydney, on the basis it was a better use of veterans’ resources. CEO Mick Frewen echoed that it gave the sub-branch opportunity to adopt modern premises in the CBD and reallocate millions of dollars into supporting veterans and their families, which he said would make “an immediate and lasting difference” to service personnel.
But controversially, the sale comes as RSL NSW investigates branch-stacking at the site, although it says this is not related.
In March sub-branch members voted 12-9 at a general meeting in favour of the proposal to sell, as a vacant possession. In July news dropped that Justin Hemmes’ Merivale had secured it for $19,000,001, being a dollar more than the reserve.
Some sub-branch members immediately objected, claiming the vote, which took place on a weekday, did not facilitate proxy or online voting, and that the site had historical significance and “relevance” through its location near the Martin Place cenotaph and other defence properties.
As the sale was conditional on a custodian being appointed, members subsequently voted (18-16) against an appointment, describing the transaction as a “flash sale”.
Independently, but coincidentally the following day, administrator PKF told members of the distressed City Tattersalls club its Castlereagh Club and World Gym sites were now closed, due to its financial position. PKF was seeking guidance from the NSW Supreme Court on winding up the 130-year-old club on the basis it is an unincorporated association.
A second sub-branch vote was organised, but the members again voted against the appointment of a custodian.
In the following weeks RSL NSW announced the membership status of people who had joined the sub-branch since July 2025 would be relegated as “unattached” as it looked into allegations of branch-stacking.
This meant the disenfranchised members did not have voting rights, which stood to alter the outcome.
Either way, the trustees provided the Board with assurance the proceeds of the sale would remain in trust until a custodian was appointed and the Board subsequently approved the sale despite the pre-sale condition not being in place. A spokesperson explained the sale allowed the Combined Services RSL sub-branch to recycle capital from an unsuitable property into “a significant long-term and sustainable investment” that would support their charges.
Last week Hemmes completed the transaction, several weeks ahead of the planned settlement.
The pub group already owns adjacent properties and the Barrack St site represented a missing component of the massive hospitality and mixed-use development on King Street Merivale announced late 2024. The Barracks is believed destined to become part of a hotel, bar, restaurant and nightclub precinct.
Many of the in-limbo sub-branch members who had joined since the FY26 cutoff were veterans who had recently served, and reporting they had been encouraged by RSL NSW to join, bringing skills and connections to the ageing organisation, they are outraged at the allegations of branch-stacking and the questions over their integrity. Correspondence to the state secretary relayed many were distressed and see the outcome as a slight on their character.
This is especially egregious given the first-time members overcame “generational antipathy towards the organisation” only to be pushed away and questioned.
The purchase marks the second recent dealing with the RSL by Hemmes, who counts himself first a real estate mogul and operates his own venues as a reliable tenant.
But the other instance is counterpoint to that, where he secured the rights to manage Club Rose Bay after it sank into voluntary administration, in a profit-share arrangement.
Initially the group was praised for its revamp of the struggling Club, but questions over the unauthorised redevelopment of Crown land adjacent to the hospitality business into a beer garden and vocal neighbours objecting to the increased activity had the waterside project back in the headlines with considerably less fanfare.
The SMH reports sources say Hemmes has posed similar arrangements at other clubs on prime real estate, such as Palm Beach and North Bondi RSLs, but it’s said these clubs were not interested.
