Marston's tenants back Retail Agreement

By John Harrington, M&C Report

- Last updated on GMT

Related tags: Retail agreement, Renting, Leasing, Lease

Findlay: Retail Agreement is key to success
Findlay: Retail Agreement is key to success
Nine out of 10 (93%) Marston's tenants signed up to its new quasi-franchise Retail Agreement would recommend the deal to others.

Nine out of 10 (93%) Marston's tenants signed up to its new quasi-franchise Retail Agreement would recommend the deal to others.

Marston's revealed that 85% on the new agreement also said they were making acceptable income — or better — from the agreement.

The deal sees them earn 20% of turnover to pay themselves and staff, with Marston's buying everything else and paying the bills.

Chief executive Ralph Findlay said the Retail Agreement had helped Marston's "turn the corner" in its tenanted estate and return to growth.

"We are the first company to report year-on-year increases in our tenanted and leased pubs.

"It proves the model isn't broken and that the right pubs with the right operator can do well."

The company has converted 227 sites to date and hopes to operate 600 pubs under this lease by September 2013, including another 100 by the end of the financial year.

The average profit per pub in the whole 1,660-strong tenanted estate rose by 1.5% for the 26 weeks to 2 April on last year with total revenue up 4.5% to £85.9m.

Underlying profit was £38.6m, which represents an increase of 0.3%.

Just one licensee has left a Retail Agreement since the scheme was launched.

Findlay said that getting rid of rent reviews and tenants having to pay for beer had removed the flashpoints in the landlord-tenant relationship.

Almost half (£6m) of the £13m spent on capital investment in the division was spent in the Retail Agreement pubs.

Related topics: Property law, Legislation

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