Community co-op revitalises condemned pub

Unlike many other small country towns, where the local hotel is a family-run business, in the Mallee district 350km northwest of Melbourne you’ll find the small town of Sea Lake, where the local pub is owned by the community. It’s a small town with only 640 residents, but what the Sea Lake community lacks in numbers it makes up for with community spirit. Journalist Michael Cavanagh caught up with John Clohesy, Chair of the Sea Lake Hotel Co-operative Limited, and Alison McClelland, Secretary of the Co-op.

The town of Sea Lake is the central hub for the surrounding district, which is home to a farming community who oversee the extensive local cropping operations. The community is older, but there are increasing numbers of young people choosing to remain local and take over the family farm. As a highlight of the Silo Art Trail and the closest town to the stunning Lake Tyrrell, Sea Lake is also a popular destination for tourists, and thanks to the hard work of committed locals there’s still a place to enjoy a meal and a cold beer, or even to settle in for the night.

But it wasn’t always this way; in 2017 the locals found themselves without a watering hole when the only other pub in town was gutted by fire, and the previous incarnation of the Royal Hotel sat condemned and waiting for a mortgagee auction. Led by John Clohesy, a group of locals saw the opportunity to purchase the building and turn it into a community asset.

Initially, the building was purchased under a company structure. However, so many people wanted to be involved that a re-think of the pub’s business structure became necessary. The residents of Sea Lake were already familiar with the co-operative model, with the local hardware store previously having been taken over by a community co-operative after the original store closed. Today, a company formed by community members owns the hotel building, while the co-operative is responsible for operating the hotel business, supported by a six-member board of directors and a hotel manager.

Navigating differences of opinion when restoring a community-owned asset can be fraught with danger, but thanks to good communication and a sense of shared purpose, co-op members have worked together to lovingly restore the building. John explains that during the renovations, “we used to have a meeting every Tuesday. The front doors of the bar will be open and it was just a mess; as you know, it was getting renovated. And if you wanted to come to the meeting and have your say, whether you're a shareholder or whether you’re not, you can pop in, have a beer, check some ideas out there. Everyone listened. We were all there for the same reason … we didn't have an argument while were doing it.”

The Royal Hotel now boasts a beautiful wrap-around veranda, where patrons can watch the sun set over a beer, and a modern bar and gaming room, as well as a restaurant and hotel rooms upstairs. The kitchen is leased out to a chef who moved to Sea Lake from Melbourne to start the popular restaurant, The Juke. The Royal Hotel has become an important part of the community: “tourists and locals alike, they come in and it's got a really good feel to the pub” notes Alison.

As much as the practical benefits of keeping the Royal Hotel alive, the community’s purchase of the pub is also about building a shared future. As John says, “we've got people coming into our communities and buying businesses and don't know how to run them. And then they just close them down and walk away and we were left with nothing. So we've taken control … we've got our destiny in our hands.” John also explains that “it's good for the community. It gives them a sense of pride. And as one bloke said to me, ‘I didn’t ever used to tell them where I was from because it was dying. And now I'm proud to be here from Sea Lake – it's good.’”

The Sea Lake Hotel Co-operative has also improved the quality of life for younger locals. John notes that it was important to “get the young ones involved and make sure they put their hands in the pocket and make sure they have a say because that's the future.” He’s a big believer that “in a small community, [you] do your bit and make it a better place.” The Royal Hotel also provides a local option for young people on Saturday nights, which means they don’t have to leave the area in search of night-time entertainment.

Alison reflects that there are different consumer expectations that come with owning a pub versus a hardware store, as well as regulatory considerations. Both hardware and hotel are distributing co-ops, so the members can get a share of the surpluses generated. Alison explains that realistically, for the first five years there is a focus on “putting the money back into the business”. In any event, the co-op members aren’t in it for the financial rewards. John notes that “in our lives, it's never to be sold. So we hope going forward that we improve in the business all the time and the community is going to get a dividend out of it”.

A $5,000 minimum investment was required to join the pub co-op, but regardless of whether they put in $5,000 or $50,000 all members have one vote. This ensures the co-op is democratically run and, as John says, that “no-one can take over and run the whole show”. He notes that to be a member “you don't have to be a local, you don't have to live here. Some did this for sentimental reasons; some did this to support the town. It was very surprising.”

Just as “we were lucky that we had other publicans in the district that were really great with giving us advice.”, the Sea Lake Hotel Co-operative is now giving back. Alison explains that the success of the hotel is inspiring other small towns to start similar projects: “what has been really good, too, is that we've given to support to other communities with their co-operatives and hopefully given them a bit of an idea of what we do and that they could do the same thing too”.

Described as an “ideas man”, John has more plans for the Sea Lake community: an empty corner shop would be a great bakery, and there’s the chance to have a local butcher shop to sell locally produced meat. For now, though, the disruption and stress of COVID means that future plans are on hold until the community is ready to step out again. One thing is clear: whatever the future holds for the residents of Sea Lake, there’s no doubt that the power of co-operation will keep them in good stead for many years to come.

Listen to our interview with John Clohesy and Alison McClelland on our Meet the Co-op Farmers podcast.

Visit the Royal Hotel, Sea Lake website.