Punch lets first 100 former Spirit pubs

Punch Taverns has let the first 100 pubs from the 725 Spirit outlets being converted to lease. The 100th inn is the Silver Jubilee in Canvey Island, Essex.

The average yearly rent in the first batch of leases is £52,000 and one in four is being taken by a former Spirit manager.

Overall lease terms average 14 years and premiums have been obtained at 85% of the pubs.

Punch Taverns has indicated that premiums range from £15,000 to about £40,000.

Punch operations director Phil Pegler said: "These are the best pubs that have ever come on the lease market."

Punch is to release the third tranche of former Spirit pubs this week - a total of 267 inns. This batch has an average per-pub turnover of £504,000 excluding VAT and average annual barrelage of 539 - wet trade accounts for an average £403,000 of sales.

The former Spirit pubs under conversion are mostly John Barras sites - wet-led pubs with average food sales of £2,000 a week.

Punch Taverns still plans to complete the conversion of the Spirit pubs by August 2007. Another 107 pubs are currently going through the legal process.

An industry source said: "These are very stable, high-turnover pubs. If Punch is charging £52,000 a year in rent it suggests licensees should be able to earn about the same per annum."

Spirit employed 39,000 people when it was running

a managed estate of 1,830 pubs. It is understood staff levels have already fallen by around 10,000 people after the sale of 400 pubs by Punch.

Spirit conversions to lease:

l Batch One: 211 pubs: Average turnover of £454,000 (Average 438 per-annum barrels). Average wet turnover: £370,000

l Batch Two: 247 pubs: Average turnover of £496,000

(Average 461 barrels). Average wet turnover of £359,000.

l Batch Three: 267 pubs: Average turnover of £504,000 (Average 539 barrels). Average wet turnover of £403,000