East-coast publicans Australian Venue Company raise a glass to the west
Pub operator Australian Venue Co. has its sights firmly set on expanding its presence in WA.
The Melbourne-based company, previously known as Dixon Hospitality, has identified Perth as a growing market, having picked up five venues within the past year and appointing a WA state manager and marketing manager.
Last month, AVC announced that The Globe in the city was the latest bar to join its stable, after Sweetwater Rooftop Bar, in East Fremantle, was added to its portfolio in March.
AVC made its first foray into WA late last year, acquiring Perth bars The Aviary and Wolf Lane as well as the restored heritage-listed Guildford Hotel from the Publican Group shortly before it was placed into voluntary administration.
Australian Venue Co. chief executive Paul Waterson said Perth was proving to be a good-value market.
Wolf Lane bar in Perth. Photo: Supplied
Its acquisition strategy focused on pubs with at least an $80,000 weekly turnover, a minimum 10-year lease, and that were within 10 kilometres of the CBD, he said.
“We have been purchasing Perth assets for about three times EBITDA (earnings before interest, tax, depreciation and amortisation),” Mr Waterson said, adding this compared favourably with Melbourne’s rate of four to five times.
“We are starting to see a lot of confidence coming back in the economy and people being willing to invest again,” he said. “Having really strong consumer confidence is pretty important to us so we think it’s a really great time to enter Perth.
“We have all the resources in place to do the acquisitions to get to 12-15 venues over the next couple of years.”
Mr Waterson said Perth enjoyed a terrific pub culture and its industry was a supportive and collegial environment.
“The Perth council has done a really great job in revitalising the city, with Yagan Square and other developments. That is also driving people back into the CBD and Northbridge,” he said.
“What also makes Perth good – similar to Victoria in some ways – is it has a strong sporting culture. Those in the west love their footy and their cricket, and will watch a bit of rugby too, so it works very well in driving that sort of patronage to the pubs.
“Because you are a non-gaming state, you are very good at driving great food and beverage concepts. Some of the pubs in the eastern states have got a bit lazy, a bit dependent on gaming to drive a profitable business. We see a lot of innovative food and beverage offerings in Perth that we think we can also apply over here in the east.”
With about 60 venues in its portfolio, the national hospitality group also operates in Victoria, New South Wales, Queensland and Northern Territory.
“We’d love to get 100 pubs or more over the next two or three years, with WA representing at least 20 per cent,” Mr Waterson said.
The company’s rebrand to Australian Venue Co. came after private equity giant Kohlberg Kravis Roberts (KKR) took a 79 per cent stake in Dixon in June last year.
