Sydney Rum Distillery to move into former Oak milk factory at Muswellbrook

Spirits maker Sydney Rum Distillery has said it will move into the site of the old Oak milk factory at Muswellbrook, with plans to have its distillery running later this year.

In a statement on Friday, the boutique distiller, which was established in 2015, said it aimed to capitalise on the growing international reputation for Australian spirits, as well as leverage the nation’s sugarcane and wine industry “to create a range of premium spirits primarily targeting global bulk and bottle markets “

SRD said it is aiming to have the distillery operational in mid-2025, three years faster than if it built a new site. It plans to create 24 new jobs.

Also cited in plans were signs that rum is moving towards premiumisation in a way that other spirits have, and the possibility of an agri-tourism hospitality venue for local, interstate, and inbound visitors.

“We recognise the heritage and history of the Hunter Valley Dairy Co-operative and local significance of the Oak brand,” said SRD CEO and master distiller Steve Magarry (pictured) in a statement. 

“The iconic building has been a part of the town’s landscape since 1945.”

As well as milk, the site has wine and spirit-making in its history, and was the former location of collapsed exporter Hunter Wine Services.

According to Magarry, the newly-acquired site has a 10-million bottles per annum output, as well as packaging and barrel-maturation onsite.

Muswellbrook Shire mayor Jeff Drayton added that the council was “thrilled to partner with Sydney Rum Distillery” to revitalise the site.” 

“It’s a rich part of our community where locals worked and connected for generations. To get that back, along with the jobs and tourism potential of the partnership, is a win for Muswellbrook Shire.”

The Oak factory went on sale in 2023, with a price guide of $10 million via an expressions-of-interest campaign.

According to a listing from February that year on Commercial Real Estate, the factory closed in 1994, OAK was bought by Parmalat in 2009, “which was, in turn, bought by French company Lactalis in 2019 – and it was converted into a wine and spirits distillery. 

This was Hunter Wine Services, “which produced 4 million bottles a year, exported to 30 countries and was Australia’s biggest seller of wine to Russia, was placed into liquidation in May 2019.”

Picture: supplied