Fire sales of watering holes
The sale of hotel assets held by failed publican and investor Michael Reardon is continuing, with the North Fitzroy Arms expected to fetch about $1.9 million when it goes to auction on Wednesday.
It's the second inner-suburban hotel to be put on the market since Mr Reardon was declared bankrupt in June, losing control of three popular freehold and leasehold venues in North Fitzroy, Abbotsford and South Melbourne.
A fourth hotel apparently escaped the collapse after control of the Richmond pub was transferred to his wife, Rosemary, for $1 just one day before Mr Reardon was declared bankrupt.
PPB Advisory, acting on behalf of Bendigo and Adelaide Bank in the mortgagee sale of the North Fitzroy Arms, declined to comment on the debt owed by Mr Reardon.
The 139-year-old hotel at 296 Rae Street is leased until 2026 to Max's Hotel Group. The 570 square-metre building returns a rent of $99,044 per annum. Mr Reardon bought the freehold for $1.4 million in 2003.
The auction comes after the Rising Sun Hotel in South Melbourne was sold for about $2 million in July to publican Peter Giemza, owner of the nearby Palmerston Hotel.
The Reardons lost control of the property after two of their companies were placed in external administration. Debts for the company are estimated to be at least $1.76 million, according to ASIC documents.
Abbotsford's Carringbush Hotel is expected to hit the market as PPB Advisory seeks to recover a debt accrued by the freehold company that is in external administration.
The future of the final pub in the group, the All Nations Hotel in Richmond, is less certain.
The hotel was bought for $1.005 million in 2007 by Ms Reardon, but the leasehold company was run by Mr Reardon and jointly owned by the couple until June. Mr Reardon said he held the share for a trust but ASIC documents show he held the share for himself.
The North Fitzroy Arms auction is being handled by Jamie Perlinger of Burgess Rawson and Terry Board of TJ Board.