Buyers not put off by Bec

Most would-be licensees won't be put off buying a pubco lease by the recent barrage of negative publicity surrounding pub companies.

These are the findings of a straw poll of agents by the MA. It follows the Business & Enterprise Committee's report into pubcos, which was heavily critical of how they operate and called for the Competition Commission to investigate.

Agents believe the lack of finance available to buyers is a bigger stumbling block than the negative publicity. However, one suggested it could mean pubcos were more open to negotiating on rent.

David Morgan, managing director of Cookseys DMP, gave evidence to the committee about the lack of transparency in the rent review process. He believes the report will not have a "huge effect at all" on buyers in the short term.

"The Bec report is not legislation — but rather firm and strongly worded recommendations. It won't change profitability of pubs or how people spend their money. All sorts of economic factors are having stronger influences at the moment."

Paul Tallentyre, head of pubs at agents Davis Coffer Lyons, said: "For people thinking about buying pubs, now is a great time with low premiums as pubcos are being more lenient in negotiating terms for leasehold properties."

According to Tallentyre, some tied pubs were still doing very well. "Deals are still being done, although banks are not being helpful. Cash buyers are negotiating very competitive deals."

Director of Colliers CRE licensed leisure team Andrew Watt said the report wouldn't have any effect on potential buyers, since "most of the information about the state of the market has been widely known since before it came out".

He said most sales now were free-of-tie pubs or those with vacant possession, which would not be affected by this potential uncertainty. Once again he said a lack of finance was having a more direct impact on sales.