The Hamilton hotel, founded in 1880, has been closed for purpose-built renovations since late January.

The Lazarus family-owned hospitality group identified a perceived gap in the market - the lack of large-capacity, dedicated music venues within Newcastle's CBD - and are spending $5 million to fill that gap. Their aim is to make The Exchange Newcastle's premier live music venue.

A two-level entertainment space has replaced the existing gaming rooms and car park. Known as Live at the X, it includes a state-of-the-art sound system taken directly from the Sydney Opera House and multi-level views of the stage including a VIP mezzanine level, and cocktail bar.

There will be live music several nights a week - as soon as it is COVID-safe to do so - and a line-up including local as well as national and international touring artists.

A wood-fired pizza oven will take centre stage at new upstairs bistro, The Kitchen. If you score a spot at the bar you can watch your pizza being made from scratch by chef Franco Malgioglio, who has spent 22 years perfecting his original dough recipe. Fresh house-made pasta is also on the menu.

Swill Bar will be located on the first floor, a cocktail bar with adventurous interiors, low lighting and DJs. The cocktails have been custom designed by award-winning mixologist and Zenith Hotels' group beverage manager, Brent Tozer.

Sports fans haven't been forgotten. The largest privately-owned screen in the southern hemisphere will be screening all the action, and there is a new TAB and Sports Bar as well.

Gareth Rattley is The Exchange Hotel's general manager and licensee. He has previously managed some of the biggest venues in Sydney with Merivale including Coogee Pavilion, Establishment and The Beresford.

"I'm very excited about The Exchange. I finished up with my Sydney clients and moved to Newcastle on Sunday with the family - we are here permanently now," he said.

"It's still very much a building site but the builders tell me we are on track for the official September 26 opening date."

Andrew Lazarus, of Zenith Hotels, bought The Exchange in 2016 for $6.625 million after it last changed hands for more than $9 million in 2014.

"This was a particularly cheap asset, I thought, based on it being such a well-known hotel. The name was worth quite a bit," he told the Herald in 2016. Mr Lazarus also owns Shoal Bay Country Club and The Beach Hotel at Merewether, both of which have also undergone extensive renovations.