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Hotel Orange is in a prime position, but prospective buyers will notice one thing missing
March 27, 2024
By Peter Holmes
The sale of the Hotel Orange on the corner of Summer and Peisley streets presents an interesting challenge both for the selling agents and whoever buys it.
At surface level the pub - known to many as "The HO" - has got everything going for it.
It stands sentry at the eastern edge of the CBD, an imposing, 130-year-old grand dame constructed decades before Orange saw electricity and motor vehicles. It was previously known as the Federal Hotel, the Empire Hotel and the Tourist Hotel, before settling on its current name in 2007.
In terms of street traffic, it's unlikely another other intersection in the city - or perhaps the Central West - sees as much activity.
The value in being able to promote events on the hotel's exterior as people wait at the lights would be worth at least tens of thousands of dollars a year.
Ahead of the last federal election in 2022, MP for Calare Andrew Gee knew the importance of having his smiling dial beaming out at everyone who entered the city from the east's main artery.
To this end, he was spotted weeks before the vote clambering around the Hotel Orange's first floor awning, attaching a large corflute. Asked at the time by The Orange News Examiner how he managed to wangle such a prime position, he said: "I just asked."
The pub is spread across two floors, has a kitchen and dining room, an expansive open bar area, outdoor seating, a handful of accommodation rooms, and a nightclub with bar, DJ booth and dancefloor. There is also an office fronting Summer Street.
It has a late trading licence, which allows people to tumble out the nightclub doors at 2:30am on weekends, demolish a kebab from Ali's and be home in bed by 3:30am.
On the flipside, the Hotel Orange has no electronic gaming machine licences, which makes it just one of two such pubs in the city (the other being the Carriers Arms).
While the owners of these two venues can rest easy in the knowledge that they're not adding to the city's considerable gambling woes - the pubs and clubs of Orange make more than $100,000 a day in pokie profits - it makes producing an agreeable bottom line all the more difficult.
Pokie money is easy money, because it preys on people's weakness. It's money earned in an unfair fight.
And it's lazy money. It's so much easier to jam a few dozen pokies into a room than it is to - for example - have regular live entertainment beyond local acoustic acts singing covers, which requires a booking agent, posters, security, support acts, band riders, promotions. Why take the risk when you have pokies, where the owner always wins?
Whoever buys The HO will either have to try and buy pokie licences from other venues, or develop a plan for turning the hotel into a hive of activity during the day and at night.
One former Central West publican, who requested anonymity, said that as a rule of thumb, each poker machine inside a pub is worth about $1 million to its sale price. Twenty pokies means $20 million plus land and building value.
A pub's value was once based on how many kegs of beer it sold each week, but those days are long gone.
The source said it was possible new owners of the Hotel Orange would close it as a pub and reopen it as office space upstairs and retail downstairs.
"There are a number of options - you could also look at focusing on accommodation, or make the whole thing offices," they said.
The pub currently does not open seven days a week.
Parking is also an issue - on Peisley Street daytime parking is for one hour, and on Summer Street just 30 minutes.
Given the rapid turnover of vehicles wanting to shop at the Vietnamese restaurant and takeaway, the kebab shop, the newsagent and the bakery, it is unlikely any extension to parking limits would be considered.
There is, however, a car park behind Peisley Street Chickens and one over the road behind the Parkview Hotel.
"The thing is, the car parks are not for sale," the source said.
Another hotel industry insider, who also spoke on the condition of anonymity, told The Orange News Examiner that although Hotel Orange's patronage wasn't as high as it could be, its location and the fact it has undergone such a significant refit could work well in its favour.
"You can build a crowd," they said. "That's easier than having to renovate. If you have a choice between renovated with a smaller clientele, or unrenovated with a larger clientele, take the renovated."
The selling agents were approached with a request for a rough price estimate. They declined, saying they would let expressions of interest (EOIs) guide the way. Such is the challenge of pricing a striking, prime position site that doesn't have the poker machine revenue on tap.
The current owner of the Hotel Orange, Vijay Bohra, bought the pub from local construction tsar Mick Fabar, who runs Mick Fabar Constructions and Green Homes Australia.
Fabar - who holds the Guinness World Record for the greatest number of hits of a speedball in one minute (447 in 2008) - bought the pub in 2006. The refurbishment was done around 2008-2009.
Fabar bought the hotel from Orange's "Mr Real Estate" Chris Gryllis.
Fabar, whose parents were pub veterans and ran the Hotel Orange, told The Orange News Examiner that when the family owned it, the pub had "a strong trade, stable clientele, and I think it was a valuable addition to the entertainment in Orange".
He said that when he sold the pub to Bohra about six years ago, the businessman didn't want to buy the poker machine licences, which were sold separately to the Metropolitan Hotel on the corner of Anson and Byng streets.
While the Lord Anson hotel on Anson Street has shut up shop (it had a handful of poker machine licences), other pubs in the city appear to be holding their own in difficult financial times.
In early 2021 the MPK group sold five Central West hotels including Orange's Royal Hotel for a reported total sum of $75 million.
The others were Dudley Hotel (Bathurst), Castlereagh Hotel (Dubbo), and Federal Hotels in Wellington and Mudgee.
In November 2021 hotel magnate Arthur Laundy and two co-investors sold the Canobolas Hotel for $25 million to the Sukkar family, owners of construction group Buildcorp.
In February 2023 the Robin Hood Hotel was offloaded for nearly $50 million.
Sold through HTL Property in 2020 to the Marlow Group for around $19 million, the pub underwent extensive renovations before being put back on the market.
These included a new bistro and indoor kids playground, new beer gardens and additional car parking.
The 2023 Robin Hood Hotel sale was again conducted by HTL Property. Orange publicans Tim Ireson (Ophir Hotel) and Ben Cochrane (Parkview Hotel) are part of the group behind the purchase of the Robin Hood.
The Orange News Examiner sought comment from Chris Gryllis and Vijay Bohra.
Hotel Orange is for sale by Leonard Bongiovanni and Jeremy Cusack of Manenti Quinlan and Associates via Expression of Interest closing on Wednesday April 24, 2024.
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