A merger is off the table, but the embattled Club Kotara was thrown a lifeline after hospitality moguls John and Phil Elsley were appointed to the board and given creative direction in the last fortnight.
The club's financial situation is dire, and it faced closure in February after a 20 per cent decline in revenue over 12 months. That month, the board put an expression of interest to ClubsNSW considering a merger by February 29, but despite some scattered interest, the deadline passed, and no committed offers came forward.
It has been a steep fall for the 75-year community institution, which went from a posted profit in the order of $80,000 in 2020 to facing administration four years later.
Board president Robert Muir told the Newcastle Herald earlier this year the decline was likely the combined hits of a post-COVID slump coupled with a cost of living crisis that was keeping patrons away, and said management had tried for 18 months to turn the business around to little avail.
The Elsley brothers, who hold an extensive portfolio of venues in Newcastle and the Hunter under their Good Folk Brewing Company label, have prepared to spend in the area of $100,000 (though the final figure had not been determined) to turn the club's fortunes around, John told the Herald on Thursday, April 11.
He said he and his brother had personally invested in the rescue of the club and were planning a staged refit that will start in the bistro and then look to bring the outdoor areas up to scratch to encourage the return of local patronage.
Mr Elsley suggested the decline, like many clubs in similar circumstances, was partly due to long-term lack of innovation to keep up with a changing industry, and warned community venues like that of Kotara faced an inevitable twilight if they didn't keep pace with their market.
Mr Muir said Thursday that city's once thriving clubs roster, numbering an estimated 76 venues, had reduced by nearly half in his three-decade tenure in the industry and, while the board had made efforts to reinvigorate business after the pandemic, he admitted that change had not come quickly enough to stave off Kotara's wane.
"I think you're going to see a lot more (clubs) close down," Mr Elsley said, "It's inevitable ... (it) will be the clubs that choose to move with it, and put on a progressive board, and progress with the times, and spend money on the club and reinvest that money, that survive."
Mr Elsley entered the industry in his 20s when he jointly bought into The Mark Hotel at Lambton with his brother and mother before adding the Blind Monk on Beaumont Street. The family eventually relinquished the Mark, but their holdings have since grown exponentially across the city and interregionally.
The Elsleys' portfolio of part- or full ownership of venues in Newcastle includes Bartholomew's on King Street; The Grand on Church Street; the Lambton Park Hotel, which they went into in 2023, and Beaumont brewery Good Folk with neighbouring bar Blind Monk. Good Folk also has its badge on The Whistler at Maitland and The Sherwood in Lismore.
Mr Elsley plans to trade out of Club Kotara's dire straits and hinted at running Good Folks' wares through the club taps while putting some work into renovations to try to draw local families and the club's community patronage.
"Phase one will be the restaurant area, and phase two will be outside," he said. We'll announce that as plans are locked into place.
"We definitely want to keep the community vibe; we want to keep it as a bowls club, but we're adding a few extra things, like a function room, to help bring the community back down there. We want to bring the club up to scratch.
"It's going to be a long road. It's not something that's going to happen overnight. It's going to take us time.
"The club is still in a very poor financial position, but going forward, we're going to be trying to trade out of that and breathe some life back into it."
While the club won't formally come together until the first board meeting involving the Elsley brothers next Thursday, Mr Muir said the past two months of negotiations had left him confident that the board and its newest members were of the same mind and were committed to reinvigorating the club to serve its members.
Messrs Elsley will take over the day-to-day running of the club, Mr Muir said, and would present their vision at next week's meeting. He indicated the club was looking to transition its outdoor spaces to trade on the model of similar clubs at Lambton Park, Lowlands and Carrington.
