The FY27 Going-Concern Funding Playbook for Venues
FY27 Going-Concern Finance for Venues | Switchboard Finance
Accommodation Finance
Going Concern · Pub & Motel Finance · FY27
The FY27 Going-Concern Funding Playbook for Venues
When a lender funds a pub, motel or park, the going concern is the asset. It is valued on the trade, not the postcode. Here is how a credit desk reads the file before the valuation lands, and what sets your gearing into FY27.
Quick Answer
When you fund a pub, motel or park, the going concern is the asset, valued on the trade rather than the postcode. A lender reads the earnings, the tenure and any entitlements, then gears against that. The file is built before the valuation. Start with pub and hotel finance.
What do lenders look at first when financing a pub or motel?
From the underwriter's seat, the first thing a credit desk reads on a pub or motel is the trade, not the title. The going concern is the asset, and it is valued on the trade, not the postcode. The freehold matters as security, but the number that drives the deal is what the business sustainably earns, because that is what the loan is repaid from. So before anyone orders a valuation, the file gets built around the earnings story.
That order surprises owners who expect bricks-and-mortar logic. A residential lender starts with the property and works back to the borrower. A going-concern lender starts with the operating business and works toward the security. If you have read our going concern explained guide, this is the same idea applied to a credit decision: the trade leads, the property follows.
How a credit desk reads the file: works versus stalls
What a credit desk really wants first is a clean, repeatable earnings figure it can read at a glance. A file that hands the valuer and the credit desk a tidy picture moves; a file that makes them reconstruct the numbers stalls. The difference is rarely the venue itself, it is the preparation.
The file that works
- Two to three years of clean financials with add-backs explained
- Maintainable earnings that a valuer can capitalise without guesswork
- Tenure documented up front: freehold title or a lease with clear remaining term
- Gaming entitlements listed and evidenced as a separate asset
- A purchase contract that separates business, freehold and entitlements
The file that stalls
- Mixed personal and business spending muddying the net profit
- No adjusted earnings, so the lender discounts the trade to be safe
- A short or undocumented lease that caps the loan term quietly
- Entitlements bundled into one price with no separate evidence
- A valuation ordered before the numbers are ready
This is where deals are won or lost on paperwork rather than fundamentals. The file is built before the valuation, because the valuer reads what you give them, and the credit desk reads the valuer. Get the earnings clean and the tenure clear, and you have set the ceiling for what the venue can gear to.
Gaming entitlements and maintainable earnings: the two numbers that move gearing
Two items decide most of the gearing on a venue. The first is maintainable earnings, the adjusted, normalised profit the business can keep producing once one-off and personal items are stripped out. A lender capitalises that figure to reach a going-concern value, so a clean earnings number is worth more than any amount of negotiation later.
The second is gaming, where it applies. Gaming entitlements are a separately valued, tradeable asset, assessed apart from the freehold and the trade, and they change the security mix a lender will lend against. As a rough map, and indicative and varying by lender, freehold with gaming gears to around 65 percent, without gaming nearer 50 percent of the going-concern valuation. A freehold motel or park more often sits in the 60 to 70 percent band. Leasehold is a different animal: leasehold sits around 40 to 50 percent of the going-concern valuation, capped by the lease term, indicative and varies by lender, because the security is the business and the lease rather than the land. Our freehold and leasehold definitions break down why tenure moves the number this much.
What FY27 changes, and what it does not
The end of the financial year is ambient context here rather than the headline. Lender appetite for going-concern accommodation has stayed steady, and the broader system view backs that up: the RBA's Financial Stability Review reads the Australian financial system as resilient, with non-bank lenders continuing to play a measured role in business credit. For venue operators that means the funding playbook does not change at the turn of the year; the preparation does.
Practically, FY27 is the moment to get the trade figures clean and the tenure documented so a credit desk can read the file fast. Whether you are buying, refinancing or restructuring across the accommodation finance hub, the same logic holds, and it sits alongside the succession and carry options on the vendor finance page when ownership is changing hands. The fundamentals carry the deal; the file lets the lender see them.
Before you take a venue file to a lender
Funding a pub, motel or park comes down to one idea: the going concern is the asset, valued on the trade, not the postcode. A credit desk reads maintainable earnings first, values any gaming entitlements separately, then gears against tenure, freehold higher, leasehold capped by the lease term. None of that changes at the FY27 turn, but a clean, ready file does change how fast and how far a lender will go.
Key takeaway: Build the file before the valuation, clean earnings and documented tenure set the ceiling on what your venue can borrow.Frequently Asked Questions
When financing a pub or motel, lenders look first at the going concern, the operating business and its trade, not the building on its own. The freehold matters, but the value sits in maintainable earnings, the lease or tenure, and any gaming entitlements. A clean, lender-ready file built before the valuation is what moves a going-concern application forward.
A pub or motel is valued on its trade as much as its building, because the going concern is the asset and it is valued on the trade, not the postcode. The valuer capitalises maintainable earnings to reach a going-concern value, then a lender gears against that figure. You can see how this differs from a bricks-only read in our guide on going concern explained.
Borrowing against a freehold going concern is indicative and varies by lender, but a freehold venue with gaming typically gears to around 65 percent and one without gaming nearer 50 percent of the going-concern valuation. A freehold motel or park commonly sits in the 60 to 70 percent range. These are starting points, and the trade quality and tenure move them, which is why we map them against the freehold definition.
A leasehold venue borrows less than a freehold because the security is the business and the lease, not the land, so leasehold sits around 40 to 50 percent of the going-concern valuation, capped by the lease term, indicative and varies by lender. A short remaining lease shortens the runway a lender can rely on. Our leasehold definition explains how the remaining term shapes the read.
Yes, you can get going-concern finance through a non-bank lender, and for self-employed venue operators a specialist funder often reads the trade more flexibly than a major bank. Non-bank and tier-2 specialists are comfortable capitalising maintainable earnings and valuing gaming entitlements separately. The starting point is to speak to a broker who works the pub and hotel finance and motel finance lanes.
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