Industry resilient despite raft of legalities says expert
The pub industry is suffering under government regulation says a leading property specialist.
Peter Lapham, senior surveyor of property advisers Matthews & Goodman, said that the pub property industry had also been buffeted by government regulation with the onslaught of the use classes order, the code of conduct on commercial leases and with commercial leases now under review by the Office of Deputy Prime Minister.
Speaking at a property conference organised by Henry Stewart, he offered a snapshot of the present industry. Mr Lapham argued that the Disability Discrimination Act, while well intentioned, had meant limited physical adjustments to pub premises with historic houses simply being unviable.
"There was much speculation this was going to bring big costs to the sector," he said. "But the reality is that disabled people went to pubs before this and will continue to go to pubs."
On the issue of smoking he said that it would force pubs with marginal food sales to make a choice between allowing smoking or food in their venue. This may affect the value of pub properties with licensees being forced to decide which course the pub must take to improve turnover.
Mr Lapham argued that a smoking ban will reduce consumer choice especially in rural areas where it will polarise people between drinking and eating out. However, he believes that outside drinking areas will improve the attractiveness of certain pubs and help them retain their value.
On the issue of the high street trade and binge-drinking he argued that a lot of bars are struggling, but are keen to grab a bigger part of the market.
"I think things have changed and one of the potential problems on the high street is the number of strong brands and customer fatigue," he said.
Hard branding is not going to return for some time as people have become more aspirational and seek more sophistication, Mr Lapham said. He believed that growth in the sector is likely to come from the bottom-end, managed estates and those which focus on reinvesting in their existing estates.
Finally, he argued that while legislation creates uncertainty for the sector, the industry had always been able to hold its own. "Legislation creates uncertainty but pubs have always been resilient. There will be continued consolidation and innovation to meet new customer habits that the new legislation creates," he said.
