Niche multiple operators leading pub success stories

09-Dec-2014 - Last updated on 26-Jun-2024 at 14:19 GMT

'Value is key and so too is the quality of service, standard of cleanliness and presentation of the premises'

The growth of multi-site operators is fuelling recovery in the property market, says Paul Davey, managing director at Davey Co.

The trials and tribulations of the largest national pub company operators have continued to dominate the headlines this year with continuing pub closures remaining foremost in most market commentary. The fact is, however, that there are some great success stories out there, particularly with regard to an ever increasing number of successful, niche village and destination pub, restaurant and inn operators looking to grow.

Most are looking to acquire up to around six to 12 sites and have very clear criteria to be met prior to entering into negotiations. Quality is key, not just in the character and charm of the property, but also the specifics of location, size and composition of the trading areas and the level of existing trade.

Some operators are happy to take on under-trading sites which fit their requirements in all other respects, while some wish only to buy into a proven level of turnover and profitability to use as a platform on which they can build the trade to realise the full potential of the site.

There are some interesting factors that have determined this strong trend. Firstly, the fact is that people in this country do want to go out to socialise in a decent pub, eat good food and have the convenience of being able to stay over in an establishment that offers both.

Secondly, there’s the customer experience. Value is key and so too is the quality of service, standard of cleanliness and presentation of the premises. Thirdly, the harsh reality of a recessionary economy is that good operators are rewarded with increased trade, mediocre operators may just be able to survive and bad operators go bust.

It is the good operators who are seeking to exploit and build on their success, with a proven formula that brings together the first two factors I have mentioned, in order to pick up on the fallout of the third factor I describe.

Completions

Davey Co has been at the forefront of this exciting market trend, evidenced by a raft of completions through the year and a solid pipeline of current deals going forward. For example, Little Britain Pub Company, headed by Ben More, acquired the new free-of-tie lease (with freehold purchase option) of the Crown Inn in Old Dalby — now their fifth site in the villages of Leicestershire.

Nigel Pinegar of Pug Pubs bought the new free-of-tie lease (with freehold purchase option) of the Old Greyhound in Great Glen, Leicestershire — their third site outside their existing trading base in Warwickshire.

Meanwhile Nathan Rivers of the Big 10 purchased the Hop Pocket in Bossingham, Kent on a new free-of-tie lease (with freehold purchase option). This is the second of a target number of ten sites for the operator.

It is great to be dealing in this segment of the market, which we see gaining further momentum through 2015. As the improvement in the economy, despite the fragility of the recovery, continues, we are extremely confident we will see more acquisitions from an increasing number of new multiple site operators in the village and destination pub, inn and restaurant sector.