Merivale’s Sackville Hotel deal faces ACCC scrutiny as Rozelle pub rivals could unite
The Sackville once lost its licence to the hotel now known as 3Weeds, and now, almost 150 years later, Merivale’s proposed acquisition could bring both pubs under the same ownership, but only if the Australian Competition and Consumer Commission clears the deal.
The Sackville Hotel first opened on Darling Street in 1876 as the Bellevue Hotel. Five years later, publican Edward Higgins lost his licence by transfer to the hotel now known as 3Weeds, forcing the Bellevue to close until a community campaign helped it reopen in 1888, demonstrating its importance within Rozelle. The Bellevue was renamed The Sackville in 1900 after its licensee’s birthplace in Scotland and has traded continuously since its 1888 reopening.
Now Merivale, which already owns 3Weeds, has exchanged contracts to acquire The Sackville from the Fairfax family’s Amalgamated Hotels. However, before it’s passed on to the hospitality giant, the ACCC is considering whether the two Rozelle pubs are close competitors and whether local customers have sufficient alternatives and is seeking submissions by August 12.
Sydney is more than familiar with Merivale’s Justin Hemmes, who operates more than 80 venues across Sydney, ranging from suburban pubs to large hospitality precincts in the CBD. The acquisition would deepen Merivale’s presence in Rozelle, where 3Weeds now houses Totti’s Rozelle.
JLL hotels & hospitality group agents John Musca, Ben McDonald and Kate MacDonald brought The Sackville to market in May for the first time in over 26 years. It was offered alongside The Clock in Surry Hills and The Bank in Newtown.
The campaign attracted domestic and offshore hospitality operators as well as high-net-worth investors, family offices and institutional capital; however, it was Merivale that ultimately emerged as the buyer.
The acquisition follows Merivale’s late-June purchase of the vacant former RSL freehold at 5-7 Barrack Street in the Sydney CBD for $19,000,001.
The asset’s appeal is clear as The Sackville occupies a 1391-square-metre corner holding on Darling Street and trades across food, bars, gaming and a drive-through bottle shop, turning over $240,000 per week in revenue. It also comes with 19 gaming-machine entitlements, with turnover averaging $1.2 million per week.
The building itself is also part of the proposition as the three-storey hotel remains a prominent Victorian-Regency landmark that makes an important contribution to the Darling Street streetscape. While altered over time, its upper levels retain much of the original hotel-room layout and early architectural fabric.
Merivale has not announced plans for the property, and any substantial repositioning would need to respond to the building’s local heritage. The council’s heritage guidance supports its continued use as a pub while allowing for periodic upgrading and adaptation.
McDonald says the sale reflects continuing demand for metropolitan hotels that combine established income with scarce land.
“The transaction underscores sustained investor demand for premium pub assets underpinned by diversified income streams, premium locations and long-term urban growth fundamentals,” he says.
The longer-term location story adds another layer. Bays West is planned to deliver up to 8500 homes around a future metro station and White Bay Power Station, while Metro West and the Rozelle Village project are expected to bring more residents, activity and improved connections to the surrounding area.
Hemmes has not commented on the pending acquisition; however, his investment strategy is clear, as he previously spoke about Coogee Pavilion in 2014, saying that every venue they acquire is tailored to the area or community they go into.
The Sackville is likely to follow this ethos, which is important for a pub that continues to be a gathering place for locals.
