The Big Interview: Peter Salussolia, Glendola Leisure

When Peter Salussolia says he operates an eclectic business he’s certainly not kidding. “There were times when I could be standing on the door of the Smugglers in Brighton ejecting some herbert one day and welcoming the queen of the Netherlands to one of our hotels the next.” Just as long as he doesn’t get them mixed up.

It’s been 40 years since Salussolia established Glendola Leisure​, the company that runs such diverse outlets as Waxy O’Connor’s, a rambling multi-level Irish pub like a high-energy enchanted forest, the jungle-style family restaurant Rainforest Café and the stylish desVins wine bar at St Pancras — not to mention traditional pubs.

And that’s only the half of it. What many don’t realise is that there is another arm of the family company operating such highly profitable international four-star hotels as the Carlton brand.

Both come under the umbrella of the Foundation Group, set up in 1972 by Salussolia when still a young man, though one who had already made a name for himself in the leisure industry. He started work with a firm called Rambutan, quickly rose from buyer to managing director, and formed a joint venture with brewer Charrington, under the name Charram.

“I opened about 15 disco pubs called Playground. Our only competitor in those days were Watney’s Birds Nest disco pubs. We had sites all over London and the south-east. Charrington offered me a job with them, but I declined as I’d always planned to go out and run my own show.”

Which he duly did. Two shows, in fact, at the same time. In two different countries. One was a small chain of bars in the Netherlands funded by a loan-tie from Skol. “It was only a 45-minute flight,” he explains. “It was closer than Scotland.”

The other was the Hop Bine, a Truman’s long lease, rare in those days, in Wembley. It was the start of Glendola and Salussolia kept his offices above the pub until a couple of years ago. It’s now a Tesco. “We never did get hold of the freehold,” Salussolia sighs.

Models of growth​
In the first few years he added more pubs before taking a management contract for a hotel in Amsterdam, which he turned around from losing half a million a year to making half a million. “I thought it was easy compared to the bars,” he says, and then he went on to manage several hotels across the world as well as starting his own chain of hotels, initially funded from the sales of the unprofitable Dutch bars. There are currently 10 of them, mostly in the Netherlands, with a total of more than a thousand rooms.

Meanwhile, Glendola, run by Salussolia’s son Alex since 2000 and kept entirely separate from the hotels, grew slowly. Perhaps more slowly than some ambitious entrepreneurs would like, but that has been quite deliberate on Salussolia’s part.

“The way I see it there are two models of growth. You have a formula and you have shareholders investing in that. You can grow quickly with a view to selling at a later date. But that’s never attracted me," he says. "As a young man I was keen to be in control of my own destiny. I wasn’t going to give away any equity. But that means growth will be slower, because you’re waiting for the cashflow to kick in.”

Today, if anything, Glendola is experiencing something of a growth spurt. In 2011 it bought three sites, taking it up to 18, including two from Scottish operator Billy Lowe — Edinburgh party venue Frankenstein, which was going to be a new Waxy’s, but will now stay as it is, and Horton’s, “a new bar-restaurant concept, although I prefer to say it’s a pub with good food”.

The third was the Cricketers, a 16th-century pub with low beams and log fires in Cobham, Surrey. Which suggests that the estate is getting no less eclectic. And Salussolia believes that’s at least part of the reason behind the group’s long-term success to date.

“We have a great balance — when one side of the business goes down, the other side goes up. There’s so much bad news in the press, but it’s still working quite well for us, though this year we are a little down in profit.”

The group’s hotels contribute £40m to turnover and £5.8m to profit. The pubs and restaurants turn over £25m and last year showed a profit of £1.9m. “We’ve equipped the pubs to be resilient and they’re holding up well. We’re not in the discount market and we’re not pushing brands everywhere. It’s a rounded business. We invest a lot of money to tailor each pub to its market. That makes it difficult to manage, but it has its advantages. We’re more efficient than our competitors.

“And we’re not a small company if you measure us by turnover rather than the number of units. Divide £65m by 28 and it’s an interesting figure — it gives you an average turnover of £2.3m.

“We’re still looking for new properties, leaseholds and freeholds,” he adds. “It won’t be a small pub — we need a minimum 4,000sq ft in a prime location. We’re interested in doing things at railway stations and we have been trying to get into airports. But there’s no fixed pattern. We’ll just see how and where we can make money.

“There aren’t as many opportunities as I’d like to see, though. The pre-pack administrations we’re getting these days mean companies keep the good stuff. But there are the beginnings of opportunities.”

Paying too much​
Salussolia remains a vice-chairman of the Association of Licensed Multiple Retailers, which he helped found 20 years ago when, like many, he was struggling with a couple of Grand Met’s Inntrepreneur leases.

“As multiples we weren’t recognised in the industry. There was nobody to represent us. We wanted longer leases, we wanted businesses we could invest in, and brewers weren’t keen to have us, though we’re more popular now. Half a dozen of us got together then and I recruited Nick Bish as chief executive. He’s done a great job, I think.

“But all we can really do is minimise the damage. It’s very difficult to make profits in pubs, especially in a leased property, and we still pay too much to the pubcos. Profits per pub are nothing like what they were 30 years ago — and that’s when we were all tied.”

Peter Salussolia is 68 with no plans to retire. He admits, though, that “I’ve slowed down since I turned 65. I take more time off now”. In the past couple of years he’s taken up his first ever hobby — skiing — and can relax a little knowing the next generation has everything in hand.

As well as Alex, son Nicholas is an area manager, daughter Louisa takes care of the sales and marketing and another daughter, Francesca, looks after the company’s property interests. His wife, Tina, is still there as his PA, too, as she has been from the beginning.

“I’m shocked that it’s 40 years,” he says. “It feels like yesterday. And I’m so pleased my children want to carry on in the business. I hardly ever see them, though — except at meetings!”

Key dates​

1972​ After opening 15 pub-discos in a joint venture with Charrington, Peter Salussolia forms the Foundation Group to run the Hop Bine in Wembley and, as Sko-Go, a chain of bars in the Netherlands

1973​ Founds Glendola Leisure

1976​ Opens the Smugglers in Brighton

1977​ Exits Dutch bars and forms Hotel Management International

1984​ Buys the Swan in Chelsea, later transformed into Brogan’s

1992​ Becomes founding chairman of the Association of Licensed Multiple Retailers. Son Alex joins company as area manager

1993​ Acquires the World’s End, Camden, then the largest volume pub in the country

1995​ Opens Waxy O’Connor’s in Soho

1997​ Rainforest Café opens in London’s Trocadero Centre

2000​ Alex takes over as managing director of Glendola

2004​ Glendola wins Publican Awards’ Pub Company of the Year title for the second time

2008​ Opens desVins wine bar in the restored St Pancras Station

2011​ Acquires two sites from Scottish operator Billy Lowe