The Queensland company behind a new cocktail bar opening in Hunter Street says it chose Newcastle for its first interstate venture because of the city's growing "vibe".
Gold Coast-based Granddad Jack's distillery plans to open a bar next door to the Rock Shop before the end of the month after lodging an application with City of Newcastle.
Company co-founder David Ridden said Newcastle had emerged as the winner after the company looked at expanding into north Queensland and Wollongong.
"We looked at lots of places. We came here because we feel this city is starting to get a bit of a vibe to it," he said.
"A lot of people have obviously moved out of Sydney this way. There's a lot of new development coming along.
"We think that this is where the growth will be, in these regional towns rather than the cities.
"People are moving out of the cities. They're too expensive to live in."
Granddad Jack's is close to other established inner-city bars, including The Rum Diary, Koutetsu, The Rogue Scholar and Jam's.
Mr Ridden said Newcastle's bar scene was "starting to mature".
"There's some great cocktail bars here already, which are fantastic and are important because you need really great experiences around everyone that brings it all together.
"I think we can really add to that."
The company is named after Mr Ridden's grandfather, Jack Goulding.
Granddad Jack's runs two distilleries and cocktail bars on the Gold Coast and in Brisbane.
The Newcastle bar will not include a distillery.
Mr Ridden said the distillery had "zero brand recognition" in Newcastle.
The company exports its spirits to seven countries but does not supply alcohol retailers in Australia.
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