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News Article Comments : Pubcos bite bullet on AWP tie
A host of tenanted pubcos are to make changes to the AWP machine tie in the wake of the critical Business & Enterprise Committee report on tenant/pubco relationships.
The MA has spoken to a number of tenanted operators who have changes planned, largely based around not rentalising machine income. One operator, though, is considering rentalising AWP income, but allowing its tenants 100% of the machine earnings.
Charles Wells Pub Company this week followed the lead of Punch in promising not to rentalise tenants’ machine share. It will still share the income with licensees, but no longer take machine earnings into account for rent calculations.
A Charles Wells statement said: “The company has reviewed its machines policy, covering retailer agreements on amusements with prizes, skill with prizes, pool tables and jukeboxes.” The company said while it will continue to share machine income, the licensee’s income from all of these machines will not be taken into account for rental calculati
14 Posts(s) found for this thread: Now displaying page 1 of 2
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Karl Harrison 25/06/2009 07:49:52  |
RE: Pubcos bite bullet on AWP tie The recommendation of the BESC report is correct and the AWP tie should be removed. Token gestures are not acceptable and particularly where the pubcos and brewers that copy them are looking to give with one hand and take back with the other. Removing AWP income from rent calculations will inevitably tempt landlords and their surveyors to try to boost FMT on food and drink to make up for their loss. For all of the reasons identified by the BESC report the the pub sector has become an inefficient market with a small number of people exercising too much control. The way forward is for long term contractual ties of all descriptions to be removed and for the rent review system to be overhauled, in the courts if necessary. This reformist or abolitionist approach in relation to the beer tie and rent systems are now favoured by all trade bodies with the exception of the BBPA of course. Lets hope that government listens to this consensus of opinion. This post replies to this thread |
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Richard Yates 25/06/2009 08:12:18 |
RE: Pubcos bite bullet on AWP tie AS Karl has mentioned .... The (Land)lord giveth and he taketh away! This is not what the BEC or the TISC called for and given the comments of Deutsche Bank the Pub Co's clearly cannot be trusted. This fudge must be rejected. The figures of income are really irrelevant, it is not the fault of the lessee that the gearing of these companies has been so poorly managed. This post replies to this thread |
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The Crocodile 25/06/2009 09:03:45 |
RE: Pubcos bite bullet on AWP tie Just a point IF and it is a big IF the AWP tie were to stay, then should it not be a fair 50/50 split with any site royalties split between the Pub Co and the tenant along with 50% of the cost of the electrical supply? Just wondering how a pub co 50/50 always seems to end up at 70/30 if your lucky! This post replies to this thread |
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| binthere donnit 25/06/2009 09:25:37 |
RE: Pubcos bite bullet on AWP tie Beware of wooden horses. I wonder how many licensees will demand a rent review and end up worse off because of "FMT" calculations from the RICS. The BEC have condemned the machine tie on the basis that; 1. Pubcos are taking half the income and doing nothing in return and 2. then rentalising the licensee for money they dont make. Is 1 above any more just if 2 is removed? NO. This has been deemed unfair for years, the licensee pays all the utility bills associated, pays for the licensing and has to clear up the mess after some mug breaks into the pub and robs the machines because the company the licensee has to use has not secured them properly. This does nothing now in the interest of a better deal for tenants. It says they will not consider machine income when setting rents at review but there too many other variables in the process for this to have any effect. This post replies to this thread |
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| Inez Ward 25/06/2009 09:23:43 |
I have to wonder which part of "we recommend that the AWP machine tie to be removed" they fail to understand? It was recommended in 2004 and again in 2009 it's not as though the pubcos didn't know it was coming. They have had five years to reform and have failed miserably and why should enrolling AWP into Codes of Practice protect the tenants? Have Codes of Practice protected tenants previously? This post replies to this thread |
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| Tony Preston 25/06/2009 09:55:10 |
I wish they would stop pontificating - jeez, they should all run for parliament! Is the phrase 'we are in discussions' or 'we are going to write to' the new way of saying 'yeah, whatever. We're stalling because we don't want to do this'? [They] are never 'in discussions' or 'writing to' when it comes to receiving monies are they. No matter what the words that come out of the mouths of the PropCos are, there is only one single outcome that can guarentee the publican is served by the BESC findings. 1. The tenent must have the right and power to source their own AWP from ANY supplier on their own terms, and they must be given the keys to the cash box, and NO information relating to the operation of AWP will be returned to the PropCo. 2. They should not be penalised via rent increases for this action. As the meerkat says - Simplez edited by: Tony Preston at: 25/06/2009 09:55:24 This post replies to this thread |
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peter giles 25/06/2009 10:07:40 |
Why can't the MA put the headline to match the story i:e "Pubcos move goalposts again" This post replies to this thread |
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| J Mark Dodds 25/06/2009 10:45:15 |
I never had AWPs at The Sun and Doves since signing my lease in 1995. Not part of the mix that makes the pub what it is. During the 2005 rent review correspondence the S&NPE surveyor, telling me that if I did not accept their rent offer, and if it went to arbitration, he 'reserved the right', to include loss of income from AWP's because I did not have them in the pub, as if I am somehow depriving them of income which it is their divine right to receive, even though they, as with everything else, do NOTHING to earn or deserve it. If that threat is not an abuse of power, what is? He also said he had 'no doubt' that if it were not for the support of S&NPE my pub would have become a block of flats long ago. It's been there since 1847. When I took it on it had a turnover of less than £60K a year. It has done more than ten times that ever since I opened it following spending £150K on refurbishment. The freeholder has not spent one penny on the pub in the last twenty years except in litigation against me. edited by: J Mark Dodds at: 25/06/2009 10:45:46 This post replies to this thread |
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| Tony Leonard 25/06/2009 11:01:58 |
If this is the degree of movement we can expect from the pubcos then the sooner the issue goes to the Competition Commission the better! This post replies to this thread |
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| Philip Sambell 25/06/2009 11:05:14 |
RE: Pubcos bite bullet on AWP tie with a 30% downturn in AWP income in the last 12 months - under the current system at least i have the crumb of comfort that our prop-co is hurting a little too! This post replies to this thread |
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