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News Release

Closed pubs offer new opportunities for the economy

According to Jones Lang LaSalle


Exeter, 20 June 2012 –Four out of the five pubs sold in the last two months by leading property consultants Jones Lang LaSalle are being transformed into new businesses.
 
During May and June the Licensed Leisure and Hotels in Exeter team dealt with five freehold pub disposals across the region with only one remaining as a pub. New uses for the other four include student accommodation, a convenience store and a restaurant.
 
“There is strong demand for freehold pub acquisitions despite the challenging market” comments Mike Easton from Jones Lang LaSalle’s Licensed Leisure and Hotels team in Exeter.
 

“When we started this disposal process in 2009 the ratio was 70/30 in favour of continued pub use to an alternative use and more recently it has been closer to 50/50 on an annualized basis. We have yet to see where we will be at year end but with the latest deals predominately based on a change of use it seems the balance may well have shifted. This is no surprise given the change in drinking habits over the past 10 years and that, coupled with the current economic climate, means we are now starting to get an understanding of the future pub estate which, with diminished numbers, is looking stronger and offers the consumer a greater choice and better experience.”

Property consultants at Jones Lang LaSalle also highlight the growth in purpose built managed public houses built by the traditional brewers over the last two years.  This is bringing new pubs into communities, where others may be closing. It also points to the growing success of food-based pubs, which other more traditional pubs may learn from.
 

Mike Easton adds: “We have dealt with a number of new site acquisitions already this year and this area is starting to gather momentum, much like the budget hotel expansion has in the past three years.”
 

“Our expectation is to see continued asset disposal of smaller pub assets and for brands to push for greater share in the food and hotel market. The private market, which has been particularly hard hit in terms of acquisitions and disposals is not expected to grow until at least 2015 – that does not mean there is no market for the going concern, but it is fair to say that that market remains challenging.”
 
“One noticeable change is that clients are having to be much more savvy in their approach to property assets and we are asked more and more to advise on strategy and future use before taking sites to the open market.”