Whitbread reveals 60 pub expansion plan

Whitbread has told investors and City analysts that it plans to open 60 pub restaurants and expand its room stock by 13,300 rooms to 55,000 rooms in the next four years.

The company said it had identified 242 new markets and 117 existing markets where it could expand its Premier Inn brand.

Managing director of the hotel and restaurants division Patrick Dempsey gave Newmarket in Suffolk as an example of a new market.

He said research had shown it would be suitable for a 80-bedroom Premier Inn and co-located Table Table pub restaurant.

Dempsey also revealed that Whitbread believes it can build scaled-down 40-bedroom Premier Inns in smaller and more rural towns without a co-located pub restaurant.

The smaller Premier Inns would have automated check-in, reduced labour scheduling and a limited food and beverage offer. Whitbread hopes to have a couple open within the next 18 months.

Dempsey said the smaller model Premier Inn would need just three-quarters of an acre of land compared to the two acres needed for a co-located site — the build-cost per room could be around £35,000 compared to the usual £40,000.

Meanwhile, Dempsey revealed that 60% of customers staying at a Premier Inn are staying to eat breakfast at a co-located pub restaurant, producing £40m of revenue per annum.

The company has also sold 327,000 breakfast-dinner-and-complimentary-drinks for £20 meal deals since launching the offer in May 2009.

A presentation to analysts also revealed that the compay is reviewing ways to reduce the £1m cost of converting sites to Taybarns.

The seven-strong all-you-can-eat concept was producing customers who were "very very happy" but the company was keen to watch the brand closely in its second year before expanding it further.