Gaming machines have become a relic of the past at The Grand Hotel after new owners, Lukas Thodas and John Elsley, removed the machines and restored the pub to its former social glory.
Six electronic gaming machines were removed from The Grand Hotel, with Elsley revealing that it was a step towards transforming the venue for the better.
“We had an opportunity to purchase the pub with or without machines, and we chose the without option,” he said.
“We want to make the Grand what a pub should be—we feel pubs have been somewhat trashed by machines and turned into gaming halls rather than what they should be, which is somewhere to get together and spend time with friends and family.”
Elsley said the decision came from an inherent sense of social responsibility.
“We’re in a spot that’s pretty vulnerable to the community, being across the road from the police station and the family law court,” Elsley said.
“So making one less venue without machines was important to us.
“As it’s not a very big pub, we thought to have gaming here destroys the venue…it takes a whole section of the pub that’s really unusable that was focused wholly on gaming, so we were happy to see them go.”
For Elsley, who has worked in the hospitality industry for 12 years, gaming had never been a priority during his management experience.
“I’ve run a few other venues in town that don’t have gaming—it’s never been a big focus for us, and I know business can be done without them,” he said.
“The Grand is in a unique position, too, as it has nice hotel rooms upstairs that help ease the pain.”
For co-owner, Thodas, who has 22 years of hospitality experience, the decision was a no-brainer for the wider social good.
“I’ve worked in pubs with gaming and have seen how it affects families… I’ve also had some personal friends who’ve done it tough by playing machines,” Thodas said.
While they were confident with their decision, Thodas admitted that removing the machines had taken a hit on venue earnings.
“It’s hard to put an exact number on it, but gaming is substantial to your bottom line,” he said.
“Gaming generally hits straight at your net profit rather than your top line, and there’s no cost of goods or anything like that involved.”
In the NSW Liquor and Gaming’s Bi-Annual Report for hotel gaming machines, the combined net profit of 886 electronic gaming machines across 58 premises in Newcastle between July 1, 2021, and December 31, 2021, was $22,336,625 million.
In net profit, the Winner’s Circle in Wallsend was the top-ranked hotel in the LGA, sitting at 148 in the state.
Hotel Elermore was ranked second at 168, Hotel Jesmond ranked 187, the Stag and Hunter Hotel in Mayfield were ranked 277, and the Sydney Junction Hotel in Hamilton ranked 302.
The Grand Hotel ranked 1139 in the state out of 1249 venues with gaming licences—renovations at the premise during the period impacted gaming revenue.
Despite the financial hit, Thodas and Elsley, said the Newcastle community responded positively to the scrapping of the machines, with many attending the hotel in a show of support.
“Removing the machines has been received really well…we had a lot of people come in who were first-time visitors or who hadn’t been back to the hotel for many years,” Thodas said.
“A lot of people commended us and had dinner and drinks to see what we’re doing with the hotel moving forward.”
He said he was confident they could restore The Grand Hotel to its former glory.
“We wanted to buy a pub in the CBD that was going to be run by people in Newcastle— most of the pubs in town are owned by large Sydney groups,” Thodas said.
“We’re Newcastle boys, and the hotel is somewhere we went when we were 18, so when things changed 10 or so years ago with restrictions, the hotel fell off the radar as a place to go.”
He said when The Grand Hotel was listed on the market, they knew it was the perfect opportunity for the venue to be restored to its previous reputation.
“We’re trying to bring back the former glory of the Underground and make it a family-friendly pub in the middle of town,” Thodas said.
The duo purchased the venue in September 2021 for a reported $6 million after career hotelier and long-term owner, Mike Angus, who owned and operated it since 1988 retired from the industry.
Elsley said the new team would strive to deliver quality old-fashioned service, with their “Underground” renovations set to be complete by early June and upstairs renovations complete by August.
“The Underground will be an underground whiskey and cocktail bar with live music as much as we possibly can … we’ll have a weekly Jazz night too,” Elsley said.
“Upstairs, we want to keep a traditional pub we feel there are not many left in town… it’ll focus on food, drinks and quality service.
“We look forward to changing the offering and trying to step things up a bit.”