Pubco vacancies on the increase
Pubcos are facing a major licensee-recruitment challenge as the number of pubs available to let shows an increase, thanks to the economic meltdown and drop in consumer spending.
Figures show numbers of available units ticking up this year. Pubs to let, including assignments, stand at around 17% of the total tied estates of some pubcos, as opposed to an industry norm of about 10% just two years ago.
The number of available leases and tenancies advertised on pubco websites provides some insight on vacancy trends. But pubcos insist assignments and other factors are a key element of the statistics.
The Sunday Times claimed at the weekend that about 18% of Punch’s estate — 1,400 pubs — was in need of a new tenant, although the figure included licensees looking to assign and 50 Spirit pubs being converted to lease.
Company websites show about 290 of Marston’s 1,700-strong leased estate seeking new hosts, and Admiral on the lookout for 232 licensees to fill vacancies across its 2,400 pubs, with a further 139 pubs up for sale.
Scottish & Newcastle Pub Enterprises is advertising for new lessees for more than 200 of its 1,500 houses.
Greene King has 181 vacancies in its Pub Partners leased estate of 1,485 houses — more than 12%.
Regional brewer Frederic Robinson of Stockport has vacancies at 49 pubs within its 400-strong estate, while Lancashire-based Daniel Thwaites is advertising for licensees at 64 of its 350 tenancies.
We are trying to help our licensees at every level. This is not about whether pubcos are good or bad people.
Alistair Darby, Marston's
Other companies, such as McMullen and Young’s, however, are able to limit their advertised vacancies to single-digit figures.
A geographical breakdown of vacancies points to major problems for the north of England, which has vacancy levels significantly above those of the Midlands and the south.
Federation of Licensed Victuallers Associations chief executive Tony Payne said the smoking ban had hit pubs in the region badly.
“The traditional beer pubs in parts of Yorkshire have seen their trade decimated — and the businesses have become unviable as a result,” Payne said.
Rising pub vacancies influenced by several factors
Pubco bosses say that advertised pub vacancies do not necessarily reflect the number of empty houses across their estates.
Companies say that in many cases, the vacancies are due to licensees assigning their pubs due to retirement, or simply cashing in the value of their leases.
Punch said 400 of the 1,400 pubs where it is seeking new licensees were lease assignments. Out of its entire estate, only 220 units are closed.
Admiral says that out of the 232 pubs it is advertising, 41 are lease assignments and it is seeking to place licensees in 190 empty pubs.
Marston’s Pub Company managing director Alistair Darby admitted pubcos faced major pressures, but insisted that vacancy levels were part of a complex picture.
“Assignments make up a considerable percentage of vacancies while other licensees leave pubs for a variety of reasons.
“The pub, like any consumer-facing business, is suffering from high overhead costs and falling customer confidence.
“We are trying to help our licensees at every level. This is not about whether pubcos are good or bad people,” he said.
Greene King Pub Partners managing director David Elliott said it had let more pubs than had come to market in the past three months.
“We have an active recruitment team and are still finding good people to run our pubs.
“Times are difficult but we’re still offering our operators a high level of business support, particularly in the critical first year,” he said.
Paul Davey, managing director of licensed property agent Davey & Son, confirmed pub letting numbers rising sharply: “The economic fall-out is major, but many vacancies are due to assignments and others leaving the trade thanks to more short-term agreements ending.”
Pub company vacancies and assignments
% of tenanted/leased estate
Punch: 1,361 — 18%
Enterprise: 1,099 — 15%
Greene King: 181 — 12%
Marston’s: 290 — 17%
Admiral: 232 — 10%
S&NPE 200 — 13%
* Figures are approximate
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