Hotel owners are finding more value in selling to developers, than running hospitality venues.
Agents say unprecedented demand for sites, particularly near activity centres, is contributing to a rise in pubs being listed vacant.
These properties are often appropriate for residential and commercial projects.
Publican and pharmacist Peter Rush is the latest to take advantage of the environment, offering North Melbourne’s Red Back Hotel.
Once owned by footballer Wayne Carey, it was the site of an incident in March 2000 involving a falling window that gashed team mate Anthony Stevens below.
Killen Thomas’ Martin Shembrey said the recent construction of the Royal Women’s Hospital, Bio21 Institute and the Royal Children’s Hospital nearby, have increased local land value.
“The Red Back is dead in the toilet,” he added.
“People are crying out for medical units in the area and the Red Back is a prime development site” (story continues below).
The owner said he has fielded several calls from suitors interested in buying the 1030 square metre Flemington Road block.
The agent added once the state government removed electronic gambling machines from the facility earlier this year, its end as a venue, was near.
Recent Going Concern pub sales include the Prince Alfred, which traded for $8.1m, and South Melbourne’s Palace ($3.7m).
South of the Yarra River, three developers have been shortlisted to buy the Beaumaris Hotel on Beach Road, in a deal expected to be worth over $11m.
Gross Waddell selling agent Joseph Carbone said inquiry outweighed owner-occupier inquiry for that 7000 sqm waterfront property, also on offer with vacant possession.
The Espy Hotel in St Kilda remains the highest-profile pub to pay the for being well located – Becton demolishing outbuildings for luxury high-rise apartments.