Pub property predictions for 2013

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Pub property predictions for 2013
How will the pub property market perform in 2013? To get the answers, the Publican’s Morning Advertiser speaks to agents in the know

Matt Bettesworth, managing director, Bettesworths

Leasehold sales should continue to tot up just as they did last year, with opportunities coming up and reasonable bargains to be had by those in the right position with cash. The freehold market will be ever-dependent on bank lending and, while there is talk of this easing, we have yet to see the results. If vendors wish to achieve a sale in 2013, a realistic price will be key.

Neil Morgan, director & head of pubs, Christie+Co

Private equity and experienced operators are likely to be the key movers — and probably the winners — in 2013. With the low-priced freehold pubs generating the most interest, these players will use their experience and financial know-how to secure excellent deals. The heightened interest this will bring to the freehold-freehouse sector will come as a real tonic to the pub industry as a whole. National and regional pub companies, as well as family brewers, will maintain an appetite for acquisitions in the managed-house sector. Unfortunately, it is likely that we will witness further business failures throughout 2013.

George Walker, associate director, James A Baker

We will see continued consolidation among tenanted pub companies, with under-performing sites being disposed of for a variety of uses. The aggressive acquisition programmes of the managed-house operators will also continue. New-build pubs will continue to be developed. In addition, there will be more managed-house brands appearing in leisure schemes competing with restaurant operators.

Graham Allman, managing director, GA-Select

There will be a strong appetite for leased pubs, both tied and free-of-tie, in 2013. The biggest problem we will face this year is the shortage of sensibly-valued stock. However, this shortage itself will halt any further decline in values.

Michael Easton, associate director, Jones Lang LaSalle

We anticipate more of the same for the coming 12 months, with corporate pub disposals dominating the overall market and representing best value for well-placed purchasers. The acquisition growth in the budget-driven sector for hotels and managed-house brewery and pub-company sites is also expected to proceed at some pace, as will the coffee-house revolution.

Stephen Taylor, managing director, Guy Simmonds

There will be a continuation of an extremely challenging property market, together with difficult trading conditions for our valued vendor clients. The market will continue to be saturated with pubco sell-offs, with many converting to alternative residential use. There will be a vast choice for purchasers, but profitable businesses will always be sought after. We have reached a point where pragmatic vendors have lowered their price expectations to correlate with those of the savvy cash buyers of 2013.

Simon Hall, director & head of pubs, Fleurets

Average sale prices for bottom-end freeholds will continue to go up as the supply side of the market slows and the quality of properties coming to the market goes up. There will be flexible terms for leaseholds, with more affordable ingoings and rents, satisfying a good proportion of the demand. For freeholds, there will be increased volumes of freehouse transactions, led by the south.

Tom Nichols, managing director, Everard Cole

The year is likely to follow in last year’s footsteps, with the churn of the tail end of pubco estates once again dominating the market. We also expect to see further planning restrictions from the local authorities keen to safeguard their community facilities as sellers seek to maximise value through change of use or development. Good value opportunities will continue to be available for funded purchasers willing to invest in the sector.

Paul Tallentyre, director of pubs, Davis Coffer Lyons

Some of the larger pub companies will continue to make the move towards being property companies, creating free-of-tie leases and incorporating their beer margin into rent. We think banks will stay in control of the market, continuing to hinder the market for first-time buyers and smaller firms because of their unwillingness to lend. Some pubcos will now be looking at how to rid themselves of troubled assets. We will also see higher premiums commanded for leasehold properties because of a lack of freehold stock.

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