SHERMAN SENDS MARY ELLEN TO MARKET

In On the Market by Clyde Mooney

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Adam Sherman has put to market his elegant Mary Ellen Hotel in the Newcastle suburb of Merewether, offering a growth trajectory in the newly refreshed pub.

Local resident Sherman purchased the Mary Ellen off-market just 15 months ago, entering the hotel industry after several decades of business ownership, most notably 15 years owning and 12 working in multiple McDonalds stores.

While admitting there are still aspects of running pubs on which he is “still on training wheels”, the veteran franchise owner feels considerable synergies arose out of his experience with the global service doyens.

“There’s certainly plenty I’ve learned from the industry, being in something new, but I’ve also certainly tried to put my spin on it with the guys,” offers Sherman.

“I think any time you get a new owner with a different set of eyes and a different skill set, hopefully you add some value to the business. I’d expect a well-respected publican buying a McDonalds restaurant would do very well, as they’re used to dealing with multiple parts to a business.”

Influences most notably took the form of dedicated maintenance and capex and the pursuit of efficiencies. This gave rise to a remodelling of the kitchen and a focus on “all those annoying fixes” often found in a well-worn pub, including making sure the air-conditioning in the kitchen performs well, to keep workers happy and productive.

Ever the entrepreneur, Sherman has a new opportunity on the drawing board, and after fending off offers to sell determined to test a hot market with the Newcastle pub, the area continuing to benefit from strong population growth, employment opportunities and improved access to Sydney.

The freehold going concern has been listed on-market for the first time in 13 years, through CBRE’s Ben McDonald and Daniel Dragicevich, in conjunction with Deane Moore of Moore & Moore Real Estate.

While the agents note the revenue mix and “strong growth trajectory” of the operation, Mary is underutilising her 3am licence, the gaming and wagering offering could be expanded, and the eight accommodation rooms on the first floor remain unused.

“The upward trending departmental revenues, combined with solid underlying property value, equals a very sound investment that will no doubt be seriously considered by a wide buyer pool of publicans and commercial investors,” suggests McDonald.

The Mary Ellen Hotel is for sale via Expressions of interest, closing Thursday, 1 March