THE AGENTS

Timothy Meek

Agency Director

James A Baker

At any one time, the number of freehold pub sites on the market with development potential has never been plentiful. However, the continued growth in interest in commercial property from developers and investors, lured by the higher returns that this area of the market can bring, has resulted in a real scarcity of suitable freehold licensed properties. They are being snapped up, often on an off-market basis, as soon as they become available.

Many of these freehold properties outlived their usefulness as a pub long ago and represent an opportunity to take advantage of a higher alternative-use value. Traditionally agents would often take these properties to market, a purchaser in the form of possibly a developer or house builder would be found, and a conditional sale agreed, subject to planning being granted, for whatever was envisaged for the site.

But things can go awry. In my experience the purchaser can manoeuvre to get more units on the site than can be justified, the planners can often be obstructive, local pressure groups voice their opinion and all of a sudden the nine months long stop completion date agreed at the beginning of the deal starts to look doubtful.

The straightforward alternative is to go for an unconditional sale. The shortage of property in today's highly-active market has resulted in a blurring of the distinction in values between a conditional and unconditional deal. With offers at this office often arriving in excess of the asking price and a potential six week exchange and completion cycle, assuming the title to the property is clear, many of our vendors are opting for a quick, clean strategy for disposal. This is particularly important where a pub is boarded-up and costs regarding security and safety issues can be a factor.

Recent examples dealt with by this office are the Happy Cocks in Bristol, now a nursing home site and the Happy Prospect in Reading. Both properties attracted substantial investor interest and fetched well over the initial sale price and on a strictly unconditional basis.

In conclusion while property prices continue at present bullish levels, and it is difficult to guess for how long this situation will remain, you might well be surprised with how quickly and what value an enterprising agent can achieve for your pub on the basis of an unconditional sale.