McMullen is latest to turn to tenancies

McMullen, the Hertford-based brewer, is to switch 18 pubs from managed to tenancy.

It is the latest in a long line of pub players to reduce the number of pubs it operates directly.

Managing director Peter Furness-Smith said: "Costs have risen to such a degree that it doesn't make economic sense to run some of these smaller managed houses."

The move will leave McMullen with 80 managed houses and 50 tenanted pubs.

Companies including Brakspear, Charles Wells, Greene King and Wolverhampton & Dudley have all switched some managed houses. Everards, the Leicester brewer, quit managed houses altogether.

Mr Furness-Smith added: "Historically we have preferred to manage our pubs as it gives a greater degree of control but in some cases that is just not possible now."

The rising cost of running managed houses in the UK is well documented.

This week Mitchells & Butlers said that the accumulative impact of red tape and new regulations on its business had been £62m over six years.

Experts estimate that the number of managed houses in the UK has dropped from 14,000 to 10,000 in recent years.

City financier Peter Hansen believes the number of managed houses will halve over the next five to 10 years.

He said: "The government is doing a very nice job of trying to kill the managed pub industry. It creates social policy and doesn't even look at the impact on UK business."