Time's up on the Monkey Bars

Raymond Tolcher of the corporate recovery firm Lawler Partners said he planned to continue trading the Monkey Bars in Balmain, Chatswood and in Dubbo with a view to putting them up for sale.

Mr Tolcher, who was appointed receiver with Bradley Tonks, also of Lawler Partners, said it was too early to work out what had gone wrong.

He planned to investigate the pubs financial problems and turn them around, he said. He would not be drawn on what the reasons were.

Potential problems could include over-capitalising on renovations of the trendy pubs and a heavy debt load.

All have been renovated in the past three years, both to lure more customers and to adapt gambling areas for smoking laws.

Westpac's decision to foreclose was a shock to the industry because Mr Hunt is an industry veteran and has survived previous downturns.

Since March half a dozen pub groups in NSW and Queensland have had their loans called in by the banks, including those owned by Tom Hedley and Stuart Laundy, the youngest son of Arthur Laundy.

More than 200 hotels throughout NSW are in breach of their banking covenants, and the banks are no longer willing to let publicans continue to trade.

Banks have lent the NSW hotel industry about $7 billion over the past five years.

The three Monkey Bar pubs are owned by Mr Hunt and his wife Kay LaForest through their private company Randall Pty Ltd, which is trustee for the Monkey Unit Trust.

Westpac's security includes the freehold to the Balmain and Chatswood hotels and the leasehold to the Dubbo hotel as well as personal undertakings and guarantees from Mr Hunt.

Last November Randall Pty Ltd also took out a $260,000 interest-only loan from a private lender secured over the Chatswood hotel.

Four months later Mr Hunt put the Dubbo Monkey Bar Tavern on the market at the reduced price of $1.1 million, if sold with its 12 poker machines. He offered a $250,000 discount to sell the tavern with just nine poker machines.

The chain began with the Monkey Bar in Balmain, expanding to Chatswood and Dubbo.