Major pub owners in push to build apartments above venues

While neither hospitality company wants to become a residential developer themselves, both have said they will engage with investors and developers if their applications are approved.

The pub giants are pushing ahead with redevelopment plans after state and federal governments introduced housing reforms designed to fast-tracking planning approvals in a bid to meet an ambitious national target of 1.2 million new homes by mid-2029.

Redcape managing director Chris Unger is confident the demand for housing, the social appeal of venues and their locations will outweigh any drawbacks of living above them.

“A pub today is, and always has been, a core part of the community,” Redcape’s managing director Chris Unger said. “Being around somewhere you can eat regularly, have a drink, see friends, all those kinds of things would be attractive, I would think. There are a lot of pubs sitting on a lot of useable land that are really well-placed to do more with.”

Redcape plans to submit development applications for three of its pubs in Sydney’s west and south-west by mid-2026, which it considers ripe for redevelopment.

A seven-storey building is being planned for above the Revesby Pacific Hotel in Revesby, while a 10-level tower is envisaged for the St Marys Hotel in St Marys.

Redcape is already proceeding with its proposal for the Leumeah Hotel where planning rules for the site will allow for housing to be developed as well. The pub owner is proposing two 10-storey towers that will include short-term accommodation, permanent housing and commercial uses, as well as an upgrade to its pub facilities.

The NSW and Victorian governments have separately introduced planning reforms that will enable residential developments to be expedited, bypassing local councils.

Unger said NSW’s drawn-out planning process had previously been a hurdle for Redcape, but the establishment of the Housing Delivery Authority had given the company confidence to push forward with its redevelopment plans for its sites in Sydney.

“We’ve been always assessing the sites for options like this. It’s not really a new thing, but we’ve found in the past, planning approvals too difficult,” he said.

“Now with these incentives … and the more pro-building that the government is delivering on, you look at these things with more confidence.”

Meanwhile, ASX-listed pubs owner Endeavour Group, which also runs the Dan Murphy’s and BWS liquor chains, has identified ten sites for redevelopment, four of which have the potential for residential apartments including The Doncaster Hotel and a Dan Murphys site in Melbourne’s eastern suburbs.

Kate Beattie, Endeavour’s chief executive, said the company had made headway on five of its ten highest priority redevelopment opportunities with four development applications lodged and one more in progress.

“In aggregate, these five sites have been independently valued at between $100 million and $150 million, and we believe there is further upside to those valuations once our DAs are approved,” she told The Financial Review.

One development application lodged already is for a 30-storey apartment and hotel tower above the heritage-listed Morrison Hotel in inner-city Brisbane, an investment that would address growth in tourism and the workforce in the city in the lead-up to the 2032 Olympic Games.

Through its hospitality arm ALH Hotels, the company plans to refurbish the pub in Woolloongabba with 245 units and 140 guest suites.

“The Morrison is one of several major development applications we are currently progressing, with several similar projects earmarked in key locations at our freehold sites that have high development potential,” Beattie said.