Free Lease for Pub

This little doozy landed in my lap about an hour ago, but I was too busy watching the ute's go around the track at Bathurst to post. This little baby has potential for anyone who can think outside the box..

http://www.odt.co.nz/regions/north-otago/358805/free-lease-pub-no-proprietor

Back to my bbq brekky.

 

Shame it's in NZ.

 

Build the biggest drive-thru to build up off-license sales - after all, miners need to have a drink as well.

 

The catch is they screw you on the lease. I know bars for sale in SEA selling for AU$1 but you have to pay the rent :')

 

These aren't uncommon even in Australia. They aren't really an investment though - its a job. Have you actually ever tried selling a lease on a pub in a small town? I've seen them on the market for 5 years and still not move.

If you want to make a small fortune in small town pubs, start with a large fortune

 

Can't even give them away

 

Despite the inference that you can make money on this if you can think outside the box (therefore your thinking is sub-par if you can't make money on this) the basics are a concern.

From what I could find;
the town has a population of 40
the pub may be owned by the Oceana gold mine (they advertised for a manager in 2014)
The business was tendered for sale with no result in 2015
The gold mine has cut staffing levels heavily in 2014
The mine will be closed by 2017

Even taking on a lease for nothing I'd be concerned what happens 2017 onwards.
How many of the 40 residents are employed by Oceana?
If this is an investment, how do you get staff when Oceana couldn't?
How do you pay rent from 2017 if the business is mining reliant?

 

As I work through the prospectus today, I will add info, but for now, I'm more interested in what the Trust has to offer to us. When we get the info, we will go over it. Oceana has also indicated, it is willing to work with a new owner and provide what ever financial assistance it can to add potential to the current hotel, by way of development. I'm also interested in the 2.2 hectares of land in the advert. If this can be developed for a "specific purpose", then that's a plus as well.

Even if the mine closes in 2017 or 2020, Oceana has indicated it will flood the reclaimed areas used for mining and cause two man made lakes for recreation, boating and fishing. There's 2 benefits right there as far as holiday makers. The area is also close to sporting areas and recreational areas, water and snow in the winter. NZ is not that big, it's 3 hours from one side to the other. So even though the hotel looks like it's in the middle of no-where, it's quite close to towns and cities. As a long term investment, for tourists, it has potential.

 

Not for the faint hearted indeed.

 

Maybe you want to read Oceana's vision for the area
http://www.oceanagold.com/assets/documents/Spotlight/heritageandartparknz.pdf
- Yes the pit will be a lake - in 150 years. Long term investment?
- Drawing people to the area is a challenge as it's off the tourist route
- Climate is harsh and changeable

Mine life to 2017
http://www.stuff.co.nz/business/ind...gold-to-step-up-macraes-flat-exploration.html

Do you have any quality hotel assets you can tell us about? Turnaround stories? Turned it into a massive money spinner and cashed out? I'm interested in any strategies you've employed in these areas more so than hypotheticals