Tony Leonard, who in partnership with Dominic McCartan ran the Spotted Dog and the Eagle, blamed the decision on “unsustainable rents” and a breakdown of the relationship with Greene King, their landlord since 1999.
The Spotted Dog, formerly the Hop Poles, reopened only six months ago on a partial tie allowing them to sell a wide range of cask and craft beers. It had already been named finalist in Brighton CAMRA’s Pub of the Year and the Brighton Foodie Awards.
“It’s been heartbreaking,” said Leonard. “We have twice turned that pub into one of the best in the city over the course of 12 years. How can you take £1.25 million from two pubs and not make any money from them?
“On the other hand, it’s a massive relief that we’ll never have to deal with Greene King again.”
Rent at the Spotted Dog was £79,000 plus 10% of turnover, equivalent to 207% of the divisible balance, and the partners had been trying to renegotiate the deal. “But in the end all we got from Greene King were solicitor’s letters,” he said.
Leonard and McCartan will now focus on their remaining freehold, the Snowdrop in Lewes, before looking for a second freehouse.
A spokesperson for Greene King said: “We have had a long relationship with Dominic and Tony, which included joint investments at both sites. Unfortunately this has now run its course and we have parted company.
“We won’t provide detail on individual agreements, however we always try to agree fair and sustainable rents.
“The two pubs have now been taken over by first rate entrepreneurs.”
The Spotted Dog will reopen this weekend (March 23) as the Cask and Kitchen, run by London craft beer entrepreneur Martin Hayes on a completely free-of-tie lease. It will be his third pub following the success of the Cask in Pimlico and the Craft Beer Company in Farringdon. Talks are underway on a fourth site, also in Brighton.
The lease at the Eagle has been taken on by local operator Indigo.