Popular bar and nightspot on the market for sale

One of New Zealand’s ‘trendiest’ late night bars - and a regular feature in Auckland’s social
pages - is on the market for sale.

Longroom in Auckland’s Ponsonby Road is a renown haunt for TV celebrities, media
personalities and sports stars, along with a healthy patronage of regulars and Ponsonby/Grey
Lynn/Herne Bay locals.

The Longroom business is now being marketed for sale by Bayleys Real Estate sales
consultants Mike Peterson and Paul Dixon. The deadline for expressions of interest for the
purchase of Longroom close on July 14.

Longroom co-owner Richard Bagnall said it was always the plan to get the bar up and running
successfully before selling up and moving on. The immediate success of the bar however had
compressed that time frame to the point where the business was now trading far ahead of
initial expectations – in total contradiction to the general economy, which had been ‘doing it
tough’ in the recession.

“Our business strategy for Longroom always had a two to five-year timeframe around it… and
we’re coming up to that two year point quickly,” said Mr Bagnall.

“That strategy also factored in a gradual revenue growth path over the initial six to nine month
trading period. In reality though, our budget expectations were blown out the window within
the first two months, as the bar literally took off within weeks of opening and revenues far
exceeded our expectations.

“Since then, the business has just gone from strength to strength. A lot of our brand profile
is due to the self-generating publicity we keep on getting in the likes of the social pages and
gossip columns of the magazines.

“In parallel, we have taken a sublet approach to the marketing of Longroom through specific
product and event promotions such as food and beverage specials which are scheduled in
months in advance.”

Bayleys salesperson Mike Peterson said that with a solid set of accounts and a strong
operation structure in place, Longroom offered the perfect opportunity to purchase a ‘turnkey
operation’ with an already established database and impressive revenues.

“The size and scale of Longroom’s operations mean the business is ideally suited for an
investment consortium to purchase - with financial sustainability for a ‘hands off’ ownership
and a stand-alone management structure,” Mr Peterson said.

The business employs seven full-time and 39 part-time staff – with senior management
employment contracts able to be transferred to the new owner. A marketing strategy –
including plans for the venue’s second birthday celebrations in August, and promotions
planned around the Rugby World Cup – is included in the sale price. The business has an 18-
year lease in place for the building.

Paul Dixon said Longroom’s revenue split was 15/85 between food and beverage sales, and the biggest opportunity for its new owners was building trade in the earlier part of the week, in
conjunction with building the brunch/lunch activity and turnover.

Bayleys Realty Group Ltd, Maritime Square, 4 Viaduct Harbour Ave, Auckland, New Zealand
T+64 9 375 6868 F +64 9 375 8676
www.bayleys.co.nz

“After opening Longroom, the operators quickly realised the optimum returns would come
from selling bistro-styled food with liquor delivering the primary sales volumes. Some 70
percent of bar revenue is generated between the hours of 10pm and 3pm on Thursday,
Friday and Saturday nights, and into the following mornings,” Mr Dixon said.

“As a result, the menu has always veered toward tapas, sharing-plate style dishes with low
food and labour costs yet high gross margins. Much of the menu seen now at Longroom
remains intact from the initial opening – reflecting that those early choices were based not
only on sound commercial decisions, but also on consumer tastes.”

Longroom was opened in August 2009 by long-time hospitality industry workers Andrew
Roberts, Des Hoeflich and Richard Bagnall. The three owners have more than 45-years
combined hospitality experience at some of Auckland’s best-known hotels and dining/drinking
establishments.

Expressions of interest for the purchase of Longroom close on July 14.

Caption: One of Ponsonby’s favourite hang-outs for the rich and famous, Longroom bar, is
on the market for sale.

Editor’s note: For further information on the background to the sale of Longroom bar, contact
Bayleys salesmen Paul Dixon on 09 375 7441 or Mike Peterson on 021 066 6091