Pub sales now in a two-tier market, warns leading agent

That’s according to property agent Stephen Taylor, managing director of Guy Simmonds, who explained that this is the first time he has seen the trend being so prominent.

He said: “There seems to be two very distinct levels of sales activity in the pub market: distressed sales and pubco disposals, and sales of quality businesses in very attractive locations which are both thriving and profitable, and for which we have very strong demand.”

Taylor pointed to a recent pub he has sold — the Cadeby Inn in Doncaster, South Yorkshire, off an asking price of more than £1m. “In this case we received an acceptable offer even before we launched our marketing campaign,” he said.

Paul Davey managing director of DDC Davey Co said he agreed with Taylor’s comments in part. “In recessionary market conditions, good operators are rewarded and their business thrives,” he explained. “Good businesses will always attract good buyers, as they are doing now.

“Poor operators suffer and end up either going bust and premises re-possessed, or they hang on and sell at almost any price to get out.

“It is a common feature in recessions for the bottom-end to sell well on price, and the better end of the market to thrive and continue to attract good demand and a decent price for their businesses.”

Neil Morgan of Christie+Co said that the tenanted sector has seen a lot of pubcos disposing of under-performing pubs.

He added: “However, in the freehold/freehouse sector, which has risen from 17,000 to 20,000 in the last few years, I expect we will see a flow of pubs brought to the market as values increase and owners go in search of a quick-win.”