One of Sydney's highest-profile nightspots, Hugos Lounge in Kings Cross, is set to close after being placed into voluntary administration on Wednesday, suffering a 60 per cent decline in revenue.
The bar, nightclub and pizza restaurant – a popular hangout for the city's well-heeled for 15 years – is likely to join the growing list of venues that have shut their doors since 1.30am lockouts were introduced in February last year.
Owner Dave Evans said administrators HLB Mann Judd would keep the club trading this weekend before shutting shop next week unless an interested buyer could be found.
He said revenue had declined 60 per cent since 2012, when an initial batch of alcohol restrictions was applied specifically to Kings Cross. The business had since cut trading hours and shed 100 jobs; its remaining 70 staff were summoned to a lunch meeting on Wednesday and told they would likely lose their jobs.
Mr Evans – brother of celebrity chef Pete Evans – blamed the state government for singling out Kings Cross with "anti-competitive" regulations. The lockout and 3am "last drinks" laws in the Cross, CBD and Oxford Street had compounded the difficulties faced by venues, he said.
"We said it would destroy business, we said it would destroy staff," he said. "And here we are."
Hugos Lounge drew a largely upmarket crowd, with high security, ID scanners and a strict dress code. The Bayswater Road venue, which once saw 6000 patrons a week through its doors, had never received a strike against it under the government's "three strikes" liquor licensing regime.
"Hugos had no trouble with alcohol, which as it turns out is more than Barry O'Farrell can say," Mr Evans said, referring to the former premier's resignation over his failure to declare a gift of Penfolds Grange.
The lockout laws and associated measures, brought in to combat alcohol-related violence following the deaths of Thomas Kelly and Daniel Christie, have helped reduce assaults in the city, Darlinghurst and Kings Cross.
But crime statistics also showed alcohol-related assaults on licensed premises more than doubled in Pyrmont over the 12 months to March, and climbed 60 per cent in Newtown. Meanwhile, City of Sydney research found footpath traffic in the Cross had decreased by about 80 per cent from 2012 to 2014.
Mr Evans and other operators have called for the lockout laws and other restrictions to be applied everywhere or not at all. A spokesman for Deputy Premier Troy Grant noted the laws would be reviewed in February and that "since their introduction there has been a 32 per cent reduction in alcohol-related violence in Kings Cross".
Chief executive of the Kings Cross Liquor Accord Doug Grand said the demise of Hugos was "pretty devastating" and foreshadowed further decline in the once-bustling red light district.
"The area itself is a ghost town from what it used to be," he said. A dozen nearby venues have been sold or shut down including Soho, Trademark and the Backroom.
Hugos licensee Adam Hart said he and his colleagues were "pretty upset" and would face unemployment in an industry with fewer and fewer jobs. "The government doesn't really want these businesses to exist," he said.
Other venues in the Hugos group, including its Manly restaurant, are unaffected.
HLB Mann Judd was contacted for comment.
