Some years ago I wrote a series of columns on the letting of pubs and the use of the letters FMT. These, of course, should stand for ‘fair maintainable trade’ but I think more often that not, the words ‘fantastic mythical target’ would be more appropriate.
I took one company to task for advertising a local outlet with the words, ‘you won’t find a busier pub in the West Midlands’ but it had been closed and boarded up for more than 18 months!
So has anything changed? Well, it should have, with all the legislation, but I doubt it.
One leading company is advertising a large pub five miles away as ‘in a charming residential area’ but in fact it backs onto a council estate with a tough reputation. Another is described as a ‘fantastic opportunity’ yet all who have operated it have left with considerable debts.
In the Worcestershire countryside, I came across another leading pubco trying to let a closed site except on the particulars there is no reference to the fact it has not been open for eight months but it’s advertised as being ‘close to a high number of residential properties’.
I asked individuals how many would a high number of residential properties within walking distance equate to?
Estimates ranged from a few hundred to 10,000. The actual answer was two.
So I asked the pubco in question whether David Copperfield been to the south of Redditch and made the houses disappear.
Then we have the concern of figures quoted as levels of ‘maintainable trade’. None of the figures I looked at relate to any historic volumes and all appear to highlight that the rateable values of the said pubs have been assessed on a far lower turnover. Would it not be an idea for companies to have to demonstrate when this FMT was actually (if
There is also the issue of ‘above average operators’. I am looking at the accounts of a Worcestershire tied lessee who has taken his pub from £423,814 and increased it year on year to a fraction over £1m. So what has the chartered surveyor brought in by the pubco stated as the FMT? Yes you guessed it exactly £1m – therefore nine years of outperforming the market, more than doubling the turnover, investing in the property and retail standards yet not one pint or baguette is down to the publican?
This begs the question: What is the difference between a minority of chartered surveyors and a high-class prostitute? I am not sure if there is one. It appears they have a similar hourly rate and, ethically, will do almost anything for it.
We have a problem letting pubs. We can’t persuade people to take the risk. Until we are honest in the letting details with maintainable trade levels that are maintainable and we reward success, not exploit it, we never will.