We met with the area pubco's estates manager and representative and spent quite a considerable amount of time touring the pub and cellar to get some indication of how much work would need to be done to get the pub up and running.
As time went on we were repeatedly asked how we would like things to look, where did we intend putting this, that, and the next thing and what kind of equipment we would be using in the food preparation area. As this was only our second visit to the premises and there hadn't been any indication, up to that point, of any kind of formal offer from either the pubco or ourselves we were slightly surprised that we were being asked for such detailed information.
The rep explained that the pubco was ready to enter into a formal agreement to let us express our interest in the lease. The agreement being offered to us would let lawyers from both parties contact each other to start the legal process.
A checklist was produced and we found that we had enough information to get the majority of the boxes ticked. One sticking point was the rent. Before we signed anything, even a non-legally binding agreement, we needed a figure. At no point in our numerous meetings and correspondence with the pubco were we ever given a definitive amount even though we mentioned at every opportunity.
The pubco had told us many things, that the rent would be low to start with as the pub was currently closed, that good retailers would not be penalised by the pubco for doing well, we were even told at one point that the rent would be "peppercorn".
You could have knocked us over with a feather when the rent was revealed to us. It was not what we had reckoned and certainly not what we had budgeted for when preparing our business plan. It was at that point I said that if there was no scope for negotiation then I would not be showing any interest and was happy to walk away.
Our meeting concluded very shortly after that.