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Head down to the local: Pubs and clubs prove viable investment opportunity
Pubs and clubs continue to represent a viable commercial investment opportunity, with the hospitality spending now significantly outpacing pre-pandemic levels.
According to CBRE’s new Raising the Bar – Investment and Innovation in Australian Pubs report, pubs and clubs continue to be a resilient investment opportunity, as the hospitality industry regains momentum.
Despite a range of financial pressures threatening to dampen the industry, Australian Bureau of Statistics (ABS) data showed that spending in the sector has surpassed pre-pandemic levels.
CBRE senior director, hotel valuations, Kire Georgievski, said that banks have been showing signs of renewed confidence in the sector, particularly in assets with consistent cash flow and gaming entitlements.
“This resurgence in credit availability is enabling more competitive bidding, especially among private investors and syndicates, and is helping to underpin valuations,” Georgievski said.
Hospitality spending has surged by 72 per cent over the past four years, with ABS data showing that Australians have continued to prioritise fitting experience-based consumption into their household budgets.
Smaller local venues have proved the most popular, with owner-operated and mid-sized pubs accounting for around 28 per cent of the market, while large-scale operations make up just 0.4 per cent.
CBRE research analyst Katya Ezhova said the sector was largely comprised of mid-sized venues that offered a range of services and entertainment options, while remaining rooted in the community.
“This fragmentation contributes to the sector’s resilience and diversity, but also presents challenges for scalability, standardisation and uniform policy implementation,” Ezhova said.
“As interest rates stabilise and cap rates compress, investor demand – particularly from institutional and syndicate-backed buyers – is poised to support modest uplifts in asset values, especially for venues with strong gaming entitlements and redevelopment potential.”
The report found that many pubs and clubs, drawing income from diverse revenue streams and serving as community hubs, often withstand economic downturns, as patrons typically cut spending elsewhere before skipping a visit.
Additionally, regional venues were also experiencing a large uptick in patronage, with many buyers opting to leave the nation's capitals in favour of "tree change and sea change" hotspots.
Ezhova said that the demographic shift was not only reshaping housing and infrastructure, but also revitalising local economies.
“Domestic tourism is another driver, and pubs which align with tourism strategies, such as pub trails, near attractions or offering boutique experiences, are especially well-positioned to capture visitor spending."
In NSW, yields for freehold going concern pubs around Sydney’s metropolitan areas have stabilised at around 6.75 per cent in 2025, while regional assets have compressed over the past 12 months, falling from 9.8 per cent to 7.8 per cent.
A significant portion of the revenue in NSW venues comes from gaming machines, with almost 88,000 poker machines operating across the state.
Pubs in Queensland continue to attract strong investor interest, particularly those with diversified income streams, such as event spaces, accommodation, or bottle shops.
In Victoria, heritage and coastal pubs have proven popular, attracting lifestyle buyers and tourism-focused investors, while pubs with boutique accommodations have continued to gain traction.