Paul Waterson, CEO, The Australian Venue Co.

The NSW and Victorian state governments are encouraging the expansion of alfresco dining as a response to COVID-19. By Frank Leggett

The state governments of NSW and Victoria—along with the City of Melbourne and City of Sydney local governments—are introducing a range of initiatives to facilitate outdoor dining and drinking options for venues. These government solutions are designed to mitigate against COVID-19 restrictions while assisting patrons to stay socially distanced. The hope is that this will begin the reinvigoration of restaurants, pubs and clubs in both states.

“We have recently convened an outdoor dining taskforce with representatives from across NSW government,” says Victor Dominello, the NSW Minister for Customer Service. “Our mission is to enable lightning-fast approvals for businesses looking to offer outdoor dining for customers this summer. The collaboration and goodwill to date has been phenomenal. I’m confident that, in concert with local council and industry, we can deliver a really good outcome for all involved. It’s definitely a case of watch this space”

Encouraging al fresco

Business Victoria has also released a $58 million Outdoor Eating and Entertainment Program. Businesses can apply for grants of up to $5000 to help adapt their outdoor spaces for expanded outdoor dining, along with training, marketing and other associated costs.

“These initiatives are great news,” says Paul Waterson, CEO of the Australian Venue Co. The business runs 170 venues across Australia and New Zealand with dozens in NSW and Victoria. While the pandemic has hit most of these venues hard, it has been particularly felt in Sydney’s CBD where trade is at 60 per cent of normal.

“They’ve spoken about a strong preference for outdoor dining but we’re yet to see what that actually entails,” says Waterson. “The councils have been good at opening applications for restaurants, pubs and bars to use outdoor areas. It appears that Melbourne will enable precincts to be developed in streets during peak trading periods on Friday and Saturday night. Whole streets would be shut down and available for outdoor dining. City of Melbourne is waiving outdoor table fees and that’s up for discussion at City of Sydney. The councils should be given credit as they’re not setting the rules—they’re responding to state government requirements. Happily, they seem to be getting behind it and trying to genuinely cut through the red tape.”

The Cargo Bar in Darling Harbour. Image by Kai Leishman

More space needed

The Cargo Bar, a waterside venue in Sydney’s Darling Harbour, specialises in vibrant American-style food, sports on TV and dancing at night. The original COVID shutdown saw the venue drop to zero sales. When they reopened, patrons were capped at 20 per table. That capacity was then reduced to 10 people per table and is the situation at the time of writing. 

“We’ve tried to make the best of it,” says Cameron Ellis, venue manager at Cargo Bar. “We still create a fun vibe, especially on Fridays and Saturdays when we put on DJs and people dance in their seats. We spend a lot of time managing patrons and reminding people we have to adhere to a certain capacity.”

“If we can increase our outdoor area, particularly as we head into summer, we can start to regain profits and pull back our missing revenue.”

“If we can increase our outdoor area, particularly as we head into summer, we can start to regain profits and pull back our missing revenue.”

Cameron Ellis, Venue Manager, Cargo Bar Sydney

With Darling Harbour’s expansive pedestrian concourse, it’s relatively simple to repurpose areas for outdoor dining. It just needs local and state governments to embrace the change and fast-track the applications. 

“If we can increase our outdoor area, particularly as we head into summer, we can start to regain profits and pull back our missing revenue,” says Ellis. “People don’t want to be inside; they want to be out and socially safe. Capitalising on the unused outdoor spaces that surround our venues would be an ideal solution. I would love to see Sydney follow Melbourne’s example, encouraging and allowing the use of outside areas.”

Costs and return

The Business Victoria grants for adapting spaces to outdoor dining are aimed towards smaller venues. As the Australian Venue Co is such a large business, it’s not eligible for the grants.

“I don’t even mind that we aren’t eligible,” says Waterson. “It should be earmarked for smaller businesses. Our problem is that it costs us about $17,000 per venue to set up the outdoor space and those spaces are capped at 50 patrons. The transformation needs to be at scale that enables us to get a return on the money we have to spend.”

Josh Collins at The LuWOW in Little Collins Street, Melbourne.

However, the al fresco solution doesn’t always work for small venues either. Josh Collins opened The LuWOW, a quirky tiki bar on Little Collins Street in Melbourne, at the end of 2019. It is a classic small Melbourne bar that holds a maximum of 50 people. 

“We had the LuWOW going really well, then the lockdown shut us completely,” says Collins. “We opened again for six weeks with a 20-person limit and we managed to make a good go of it.

“Our street is steep, narrow and very busy. It’s impractical to expand out there. Setting up al fresco also comes with a lot of conditions, such as having a line of sight, which we don’t have. It’s an expensive solution that isn’t going to satisfy operators or customers.”

A big part of the problem for many venues is that the CBD is presently devoid of people. Large companies such as banks and financial sector businesses are planning to let their staff work from home for the entire summer. 

“Sydney is looking pretty sparse at the moment,” says Ellis. “We need to encourage the safe return of people to work back in the city. Cargo Bar is currently running a tight ship but we’re making enough to survive and working with our landlord to ensure our long-term future.”

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