Craft accelerator and hospitality business Mighty Craft has agreed to sell the freehold of Jetty Road Brewery’s Dromana site in a leaseback deal.

The business agreed to the sale for $3.55 million and simultaneously agreed a 15-year lease with the purchaser.

The ASX-listed company said the move was part of its “capital management strategy” and represented a $2.3 million profit on the sale before transaction costs. The site was acquired in 2018 for $1.2 million.

Mighty Craft said the sale would allow the continued investment in its high growth spirits, RTDs, beer and cider brands.

Mighty Craft, then Founders First, has been involved with Jetty Road since 2017 and helped fund the brewery’s venture into South Melbourne, which was subsequently scrapped at the end of 2020.

The decision was made to rethink the $3.5 million plans due to lessons learned from COVID according to chief executive officer Mark Haysman, and it was announced that instead, the brewery would move into Lorne, a coastal tourist town in Victoria.

The deal follows the announcement last week that Mighty Craft is selling its Mighty Hunter Valley venue as a result of a change in strategy.

In its annual report, Mighty Craft said that venues and hospitality continue to be an “integral driver of brand awareness and loyalty and an important investment in our brands”.