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Small bar charm lifts property search

7 February 2014

Small bars have been popping up all over Sydney over the past five years, placing increasing pressure on agents to find clients unusual properties with character.

Over the past five years the number of small bars in Sydney has multiplied from single digits to more than 80 venues, an increase of approximately 1000 per cent. As licensing changes make it easier and cheaper for small bars to open (see box), there could potentially be even more bars opening, but what impact will this have on agents?

Licensing changes

The success of the small bar scene can be traced back to 2008 to the introduction of two key legislative changes.

First, the NSW Office of Liquor, Gaming and Racing introduced a new ‘General Bar (Hotel) Licence’ for a mere $500. Following that, the City of Sydney made changes to its Late Night Trading Development Control Plan to establish a less onerous process for people wanting to set up new premises with a capacity of 120 people or less.

Melbournisation of Sydney

Gunning Commercial’s Director Tom Speakman points to the Little Pocket Group and the Shady Pines boys as “the real pioneers” of the small bar scene in Sydney. Between the two groups, they currently tally a total of five venues across the city.

Location is the ‘key’ to a successful small bar operation, according to Karl Schlothauer, owner of the Little Pocket Group. “We look at traditionally strong night trade locations and go from there,” he said. “We are prepared to look at any property that has good ‘bones’ that we can work with – ideally building features such as archways, timber beams and columns, and heritage-style features.”

Tom has found that venues that have historically been the most difficult to lease are now being snapped up quickly because they are a little quirky, and it’s this raw and unique quality that both the owners and patrons are after.

“Usually, bars and restaurants go into any space that is grand, shiny and nice, whereas these places are dark and dingy with some being restored from their previous existence as storage spaces,” Tom said. “Instead of hiding the fittings, they want to show the floors, walls and exposed ceilings etc, in their bare state.”

Demand for the quirkier spaces has meant it is becoming increasingly difficult to find places with character. The pressure is on agents to find more obscure properties, which means thinking outside the box when showing potential properties to interested parties.

Tom points to the example of the Lobo Plantation on York Street; the basement rum bar hides it former life as a hair salon well. Under its new guise, the low ceilings and exposed brick walls, along with the clever use of dim lighting and interior styling, have been put to good use to add a taste of plantation chic.

Prime locations

“I feel as though the CBD is the new Kings Cross, and it’s where people want to be at the moment. It’s definitely had a revival and it’s a refreshing change,” Tom said. “We are also seeing these bars spread to the North Shore. Those little high streets up there are developing quickly.”

Time Out Australia’s Chief Food and Drink Critic Myffy Rigby believes the Sydney small bar scene is just getting started.

“The city, for instance, is set for a real cultural shift as more and more great little bars open up,” she told the Journal.

“Sure, some parts of Sydney are probably a little over-catered for (Surry Hills, for instance), but I think there’s always room to move and grow.

Local impact

But what impact do small bars have on residential areas? Not much, according to Tom.

“Most of the time they blend into residential areas quite well, and are actually a drawcard for stimulating areas that were perhaps once not so active. Residents love new life and social opportunities in their immediate locale.”

The City of Sydney views them as a key component of the City’s efforts to revitalise Sydney and bring life and variety back to the laneways and small streets. In some locations, such as Bulletin Place near Circular Quay, the success of small bars has even led to other small businesses setting up nearby.

While the economic impact of the bars is yet to be measured, the hope is that this network of small bars will improve the range and diversity of meeting places for Sydneysiders and visitors to Sydney and build a safer and more civilised nightlife in the city.