The Sydney hotelier already owns Hamilton's Exchange Hotel and the Shoal Bay Country Club in Port Stephens and told the Newcastle Herald he had been eyeing "The Beaches", as it is known to locals, for some time.

"When we thought about possibly expanding our hotel portfolio, I thought to myself there would only be one pub in all of Newcastle that we'd be interested in purchasing, and it came along, so I was determined to do everything possible to get our hands on it," Mr Lazarus said.

Occupying prime real estate and offering stunning coastal views, the Merewether establishment on the corner of Frederick and Ridge streets is considered one of Newcastle's most prized pub assets.

It was listed for sale through an expressions of interest campaign in October and marketed by Deane Moore, of Moore & Moore Real Estate, in conjunction with Mike Wheatley of Knight Frank. Mr Moore reported nationwide interest in the landmark property.

"It's such an iconic, coastal venue," Mr Moore told the Herald in October. "There's only so many coastal hotels along the eastern seaboard of Australia. It's prime real estate overlooking the beach at Merewether and with views to Bar Beach."

Mr Lazarus has been in the hotel industry for three decades and his list of assets include The Eastern in Bondi Junction. Lifestyle and affordability have provided the appeal of a move into the Newcastle market.

"The Sydney pub market is just totally unaffordable now and, just getting to the age I am now, we took a decision in terms of lifestyle that we'd love to work and live in this region," Mr Lazarus said.

"So Shoal Bay has been a breath of fresh air. We now live there and absolutely love it and we've achieved more than what I could have possibly imagined in such a short period of time. Now we're looking to see if we can emulate that in Newcastle."

His family bought the Shoal Bay Country Club in 2016 and have refurbished it to the tune of $6.5 million. Mr Lazarus said they planned to also breathe new life into the Merewether venue.

"By improving the product offering, mostly the food and beverage offering, I think it can increase patronage dramatically," Mr Lazarus said.

"There's potential to expand the footprint as well. We've got some ideas at this stage but we want to get in there, we want to engage with the community, we want to talk to the locals, we want to get input from architects and designers and all of the rest and then make some decisions and probably look to refurbish the place next year.

"We've talked about, where's the best position for the bistro? Where's the best position for the entertainment? The layout of the hotel is very much front of mind at the moment. We're already working with architects and builders to get ideas, but we don't want to rush into it.

"We're going to look to see what kind of entertainment the market is wanting.

"There's a potential to trade longer and earlier. The hotel is not currently using it's full trading hours."

Mr Lazarus' son Peter will oversee the day-to-day operation of The Beach Hotel.

"Everyone's got a story from the Beaches," Peter said. "It's a part of the Newcastle landscape. The word iconic gets used a lot but in terms of iconic assets and properties in Newcastle, this is certainly one of them.

"Our understanding is it's the only pub in Newcastle right on the beach. You just can't beat those views and we're extremely excited about it."

The property has been part of the Bale and Twohill families since the mid 1970s. A sale price has not been disclosed but given the location, it is likely to have been one of the biggest transactions of a Newcastle pub.

"We moreso paid for a part of history," Peter said. "How can you put a price on that. You do purchase on what you think you can do to an asset, but we've really purchased a part of Newcastle history and we do look forward to seeing what we can do and create our bit of history as well."