By Stephen Taylor, Managing Director, Guy Simmonds (www.guysimmonds.co.uk)
After an extremely long winter, where we have endured another lethal wave of Covid19 and high prevalence, resulting in a full lock- down for the country, the hospitality industry and our beleaguered publicans – how does this Spring re-open- ing and forthcoming Summer trade bode for the licensed trade?
Our last property update documented how the licensed property market was extremely challenging and naturally affected by the pandemic.
However, whilst the market, values, profitability and volume of licensed business sales was obviously reduced, at Guy Simmonds we are pleased to have a healthy pipeline of both freehold and leasehold businesses under offer, following a relatively good number of completions taking place over the winter 2020/2021 period.
Sale prices for leases and freeholds at Guy Simmonds are covering a broad spectrum, ranging from around £10,000 to circa £1.5 million.
We have many further completions throughout the country scheduled for this Spring and Summer 2021. Indeed we are experiencing a shortage of freehold and leasehold businesses to replace recent sales.
We have prospective cash purchasers actively and urgently seeking freehold and leasehold pubs and licensed property/businesses nationally to buy now, and they are extremely optimistic of being able to achieve a good trading level this 2021 summer and thereafter.
We also offer our specialist expertise whereby we advise retiring freehold owners upon the option of retaining their freehold premises and creating a new free-of-tie lease lease, for their annual income. We advise upon achievable, sustainable rent and terms, (crucial during covid19 prevalence) and find a suitable lessee and have provided this expertise and resulting success for over 30 years.
We have purchasers looking to buy due to deciding upon a change of lifestyle, or as a result of being made redundant from other sectors or corporate positions. We also have professional purchasers looking to buy freeholds at sensible figures for investment or/and instructing us to find them a suitable lessee for long term rental income.
Of course values have been affect- ed due to the pandemic, due to the reluctance of banks to lend and since the level of profitability has been severely impacted, often reducing the goodwill element of a business which a purchaser is prepared to pay.
Nevertheless, providing a vendor is savvy and realistic, in line with market conditions, sales are still taking place at Guy Simmonds.
Freeholds are still hugely popular and finding professional and private buyers, especially since the freehold ‘bricks and mortar’ element of a going concern business always has an intrinsic value.Also a freehold has cur- rent/future value for potential ‘change of use’ to residential, which is of course a very buoyant sector at present.
We now have to assume Covid19 is endemic, and we will have to learn to live and cope with it in our personal and business lives for the foreseeable future and to plan/react accordingly.
Consequently, uncertainty will of course continue to prevail in these unprecedented times, with current and probably future variants of concern, potentially under- mining our hugely (thus far) impressive vaccine roll out.
However, and with our ‘glass of real ale half full’, we can hopefully look optimistically forward to another summer and thereafter of very good trade in the hospitality industry, with our great resilient operators and publicans again achieving excellent gross profits.
This late Spring and Summer should also see our industry hugely benefit from the ‘holiday staycations’ and people who instead of taking holidays abroad, elect to stay in the UK to visit and spend their ‘pent up’ accumulated winter savings in our hugely appealing pubs and restaurants.
For those publicans and freehold owners thinking of selling at this possibly optimum time or in the future, please email with your preferred contact details and best telephone number to: firstname.lastname@example.org.We will then contact you in confidence and with no obligation, to discuss values, your exit strategy and crucially offer honest and realistic advice for you, during these challenging times.