The property agent also predicts that a “steady stream” of distressed properties will come on the market. Fleurets struck an optimistic tone, saying that the sector operates in a “much more positive environment” now than any time in over five years.
Fleurets said that its transactional activity has slowed down in the past 12 months. “However there are rumours of larger deals in the offering and these are likely to surface in 2013.
“In the current economic climate a key driver to achievable price and required marketing period, is the availability of funding to prospective purchasers. The likely category of purchaser is of prime importance. The established corporate operators continue to have readily available funds.
“Contrary to this, privately owned companies and individuals are presently less able to secure financial backing. A number of traditional lenders have become increasingly cautious of the sector and are reluctant to support new ventures or customers.”
Fleurets said that leaseholds held on “rack rental” terms - high or extortionate levels - “have experienced very significant declines in value and are now considered by many lenders to be unacceptable security for loans”.
“Whilst freehold properties continue to be traded in mixed market conditions, many transactions relate to distressed assets where sales may be adversely affected by the absence of trading information, operation under temporary management or restricted timescales.
“Prospective vendors not obliged to sell are more inclined to put off sale decisions and await better market conditions. As demonstrated by the market over the last three years, we anticipate a steady stream of distressed sale properties coming to the market in 2012/2013.”
Fleurets said it expects to report its 2011/2012 price survey shortly, “but early indications are that the pubcos have been selling higher value units than before, especially in the south east whereas the volume of sales have been declining in the north of England”.
Fleurets said the bad news in the industry over the past five years - including the smoking ban, the recession and curbs on consumer spending, and off-trade discounting - is “behind us”, with well-run pub companies able to cope, announcing rising like-for-likes in the managed sector and “less bad” like-for-likes in tenanted and leased.
The company pointed to positives such as the fact share prices of quoted pub companies have risen 17.47% over the year, against +8.02% for all quoted shares and +6.44% for the FTSE 100.