Room to expand as Malmaison men move into pub market
If the pub market is struggling, fortunes are more mixed for hotels. Some pub chains, such as Marston's, are moving into accommodation, while other smaller operators find the cost of doing business too great.
Observers therefore view the move by owners of the Malmaison and Hotel du Vin chains to apparently ditch hotels and switch their focus to acquiring pubs as an interesting one.
Marylebone Warwick Balfour (MWB), the property group that owns the hotel businesses Malmaison and Hotel du Vin, wants to sell. But the credit crunch has forced the group to push back the deadline for selling up and returning cash to its investors by two years - until December 2010.
In the meantime, it is working on the opening of two 'Pubs du Vin' - in Brighton and St Andrews.
In an independent venture, MWB boss Richard Balfour-Lynn and Hotel du Vin chief executive Robert Cook have also bought the Fox and Anchor pub in the Smithfield district of London.
The pair have turned the Fox, a former early-hours favourite of blood-stained workers from the nearby meat market, into a gastropub which has garnered rave reviews since opening last November.
The three pubs are seen as mini Hotels du Vin, each having small numbers of guest bedrooms. It all points to MWB making a dramatic move from fine wine and room service to pints and rustic letting rooms. In this tough era for pubs, it seems a strange time to do this - whatever the state of the hotel trade.
While Balfour-Lynn and Cook vigorously deny any such switch, Cook believes "hotels are done" and claims to be "cutting the umbilical cord" between the Fox and the Malmaison hotel that neighbours it.
Success is possible
In his view, new entrants to the pub market can still be successful in mid-2008.
"If I gave you a figure for how much we paid for the Fox, the rest of the pub trade would look at it and say it's a lot. But they should see our food sales and the room occupancy rates," he says.
"Most pubs are struggling, but then there are pubs and there are pubs.
"When we started Malmaison in 1994 a lot of people said it was not a good time to be getting into hotels. But we broke the mould with hotels where you could have a decent meal."
The opening of the first Pub du Vin in Brighton has been hit with a six-month delay after planning issues with the Sussex Arts Club intended to house it.
A summer opening was planned after Hotel du Vin bought the Arts Club in October, spending £4m on the purchase and the refurbishment.
However, Hotel du Vin is now racing to have the pub trading before the end of 2008, leaving the rooms until the following year.
Ma Belles, a St Andrews venue popular with students, was bought as part of the St Andrew Golf Hotel at a total cost of £5.5m in January. It is hoped this will open as a Pub du Vin in autumn 2009.
Cook says he and Balfour-Lynn are actively looking for more pubs in London to be owned and run, like the Fox, independently from MWB. His "utopia would be to own a dozen pubs up and down the country" under the Pub du Vin brand.
Meanwhile, two members of staff from the pubs are currently studying brewing. Cook says the opening of Pub du Vin's own brewery is being considered, depending on the growth of the pubs' numbers.
Whatever the future for Malmaison and Hotel du Vin, it's clear the new pubs are seen as very separate by the individuals steering the businesses.
"We happen to have two big swanky brands, but our passion is about being extremely traditional," says Cook.
"The meat packers are welcome in the Fox and Anchor. Bloody overalls should be able to rub shoulders with pin stripes. In Ma Belles, these kids have been using this student dive for 50 years and there's nothing wrong with keeping it that way."
This is not Robert Cook and Richard Balfour-Lynn as swanky hoteliers, he adds - this is the pair running pubs.
