Rod Salmon has passed his newly rebranded Chatswood Hotel on Sydney’s north shore to a growing local operator.
The two-level pub, previously known as the Chelsea, occupies a 765sqm strata site surrounded by residential and commercial buildings and opposite the bustling Chatswood station. The space is efficiently configured, comprising public bar, bistro, bistro bar, and gaming room with 30 machines.
Shortly after divesting former warehouse the Rydalmere Tavern for $60 million, in late 2022 veteran Rod Salmon and his son Nate paid Gallagher Hotels $30.5 million for the freehold going concern of the Chelsea. Gallagher bought it for circa $20 million from Solotel in 2018.
Citing a change in key investment drivers as a catalyst, the Salmons listed the re-branded and refreshed Chatswood in May, with marketing alluding to the reactivation of dormant and underutilised trading areas, successful reconfiguration of the gaming room, and revenue north of $95K and growing.
The buyer was not officially announced, but reliable sources say local force Myles Docker has paid $28 million for the pub, reportedly with a strategy to expand the existing trading footprint and optimise the current offering, including the introduction of a branded sports bar and all-weather beer garden area.
Docker is the director of the Chatswood Chamber of Commerce, and has operated a lease at the nearby Orchard Hotel in Chatswood since 2012. The pub has gone from strength to strength in the past decade, generating strong food and bev trade and becoming a top-ranking gaming venue.
The local publican’s grip on the somewhat unique gilded precinct may make him best suited to its success.
2022 recorded a highwater mark for Australian pub values and transactions, which proved destined to sink with the rise of interest rates. After a lacklustre FY24 sales landscape, recent months have seen momentum begin to build again, particularly in the NSW market, prompting pundits to point to why pubs feature heavily in many investment portfolios, enjoying the resilience of cashflow backed by real estate.
The Chatswood campaign through JLL Hotels’ Ben McDonald and Kate MacDonald, who also brokered the sale to Salmon, reportedly generated over 50 enquiries, amongst them interstate hoteliers seeking exposure in NSW.
Agents anticipate ongoing demand from established hoteliers, as well as “opportunistic asset managers”, to peak in the coming months, as the warmer months benefit the burgeoning Chatswood.
“The genuine trading upside via existing DA approval and recent two-hour licence extension from 1am to 3am underpinned interest in the opportunity and will no doubt support future earnings growth of the business,” offered MacDonald.
