Pub closure rates decline, says Christie + Co

The firm saw a 13.8% decline in the number of instructions in 2011 compared with 2010, said the Christie+Co Business Outlook 2012, which calculates statistical changes derived from pub transactions brokered by the firm.

Average prices also fell in 2011 by 1.1%, compared with a 0.9% decrease in 2010.

However, Christie+Co head of pubs Neil Morgan said that the industry needs to lose 2,500 to 3,000 sites within the next two or three years to achieve a “vibrant” marketplace.

The report also said that there are fewer pubs selling for alternative use as 64% of pubs sold in 2011 remained as pubs — up from 60% in 2010.

Christie+Co added that it saw an 11.5% rise in the number of offers received last year, compared with the previous year.

Morgan said: “Though clouded by the general economic malaise, 2011 has given the pub sector grounds for optimism, with average prices holding up and increasing numbers of pubs staying as pubs after being sold. Moreover, of those pubs that do close, we are reassured by a growing number that are retained for some leisure use, such as restaurants.

“However, the pub market is still over-supplied and we need to lose a further 2,500-3,000 over the next few years if we are to achieve a truly sustainable and vibrant pub marketplace, offering choice and better quality for consumers.

“This is symptomatic of an exciting sector for which there is increasing and returning appetite from some entrepreneurs who left when times became hard.”

He added: “Funding remains a big question. Traditional high-street lenders have their own damning experiences with ‘toxic’ property, so it is not surprising that they remain cautious about investment in the public house sector.”