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Fri 15th Dec 2017 - Propel Friday News Briefing

Story of the Day:

Zebrano sold out of administration for £750,000, new document reveals: The company behind three-strong London-based restaurant business Zebrano was sold out of administration for a total consideration of £750,000, a new document has revealed. A report by administrators Darren Edwards and Michael Wellard, of Aspect Plus, showed the business and assets of Automa was sold in September to Zebrano Bars and Clubs, a connected company of which Donald Cameron and Cevat Riza were directors. An initial consideration of £400,000 was paid, with the remaining £350,000 being paid over 18 months in equal monthly instalments. The report also revealed there was sufficient funds to pay back secured creditor Lloyds Bank in full and enable a distribution to unsecured creditors, although it was not possible at the time of the report to quantify the dividend. Lloyds was owed a total of £303,882. Zebrano opened its first site in Ganton Street, Soho, in December 2004 before adding sites in Greek Street, Soho, in 2008 and Houndsditch in 2015. As part of the deal, the jobs of 87 employees were preserved. The report also revealed trading difficulties at the Houndsditch site, largely blamed on substantial construction work in the area, which led to the company eventually entering administration in August this year. The report stated: “Trading at the two Soho sites has historically been strong but the company encountered difficulties at the Houndsditch site. Since opening, Houndsditch never met forecast turnover levels. In large part this was due to the substantial amount of construction work ongoing in the area, which had been delayed from its initial estimated completion in 2016. In order to continue to operate Houndsditch the resources of the other two sites were effectively drained. Furthermore, equipping and decorating the Houndsditch site had led to the company being increasingly reliant on HP finance and other leases, alongside acquiring some £500,000 of debt, both secured and unsecured.” Automa entered into a Company Voluntary Arrangement in September 2016 but ongoing trading losses at the Houndsditch site meant it struggled to meet its agreed payments and breached the terms in June, which eventually led to the company entering administration. Draft management accounts for the year ending 31 December 2016 showed the company had turnover of £5,408,569.

Industry News:

More than 350 booked for Restaurant Marketer & Innovator event series in January: More than 350 senior executives have now booked for Restaurant Marketer & Innovator, the most comprehensive marketing series the sector has seen. Propel will stage the two-day event in partnership with Think Hospitality on Wednesday, 17 January and Thursday, 18 January at One Moorgate Place in London. An array of marketers from agencies and early-stage, growing and rejuvenating brands will take to the stage to share their strategies and winning tactics. Companies and brands attending include Novus, Signature Pubs, Cafe Rouge, Wagamama, Brasserie Bar Co, Las Iguanas, YO! Sushi, Fuller’s, ASK Italian, Mitchells & Butlers, G1 Group, Costa Coffee, Ei Group, Jamie Oliver Restaurant Group, Brewhouse & Kitchen, Stonegate Pub Company, Be At One, Revolution Bars Group, Cabana, Thai Leisure Group, New World Trading Company, Pho, Maxwell’s Group, Gather & Gather, Oakman Inns and Restaurants, The Breakfast Club, The Coaching Inn Group, Gail’s Bakery, Gordon Ramsay Restaurants, K10, Giggling Squid, San Carlo Group, Ennismore, TLC Inns, Polpo, FrogPubs, The Real Eating Company, Claus Meyer Holding, VIP Pizza, 200 Degrees, Coppa Club, Snug Bars, Albion & East, Pint Shop, True North Brew Co, Darwin & Wallace, Chit Chat Chai, BabaBoom, Electric Star and Eat Poke. For full details of the two days, co-ordinated by James Hacon and Ann Elliott respectively, click here. Conference prices for two days are £525 plus VAT for operators and £795 plus VAT for suppliers. Companies buying two tickets will receive a third one free. A one-day rate of £345 plus VAT is available to operators only. For more information and to book, call Jo Charity on 01444 810304 or email or Anne Steele on 01444 817691 or

Pubs regulator sees professional body uphold challenges: Pubs Code adjudicator Paul Newby has had several challenges against him upheld by his professional membership body. Newby has had four out of 12 challenges made by pub landlords against him upheld by the Chartered Institute of Arbitrators (CIArb), of which he is a member, since his office was created in July last year. Newby was appointed by the government to settle disputes between the UK’s largest pub companies and their respective tenants in Market Rent Only disputes. The adjudicator is currently dealing with 89 live cases. A Freedom of Information request submitted by lobby group the Pubs Advisory Service showed four of the 12 challenges made against Newby were upheld by CIArb. In spite of this, to overturn the ruling those four tenants would need to take their dispute to the High Court. A CIArb spokesman told The Telegraph a challenge was permitted against one of its members if “circumstances exist that give rise to justifiable doubts as to the arbitrator’s impartiality or independence”. He added a successful challenge did not necessarily mean the wrong decision had been made by the arbitrator. However, when a challenge was upheld, an arbitrator’s appointment in that individual dispute was “immediately terminated” and they should not be involved in that particular case again. A spokesman for the Pubs Code Adjudicator (PCA) department said its responsibilities were established by an Act of Parliament and it did “not accept CIArb has any jurisdiction to appoint or remove an individual from the role of arbitrator in a Pubs Code arbitration”. The PCA said Newby remained a member of CIArb.

HVS chairman forecasts challenging year ahead for UK hotel operators: Next year will be a challenging one for UK hotel operators with flat occupancy levels and increasing overheads despite positive global and EU economic growth, according to Russell Kett, chairman of global hotel consultancy HVS. However, he said average room rates should see modest growth. Kett warned a combination of rising wages and food and utility costs – alongside staff shortages, higher property taxes and business rates, and a strong pipeline of new hotels – would put pressure on UK hotel operating margins during the next 12 months. However, despite little or no occupancy growth, yields were likely to increase slightly, with Kett forecasting an average daily rate and revpar rise of 5% in London and 3% in the regions. Kett said leisure travel would remain strong in the UK in 2018, particularly while sterling was relatively weak, although corporate business looked set to be squeezed as companies sought to contain costs. He said security concerns in key cities also remained in the background but had yet to materially affect hotel demand. He added that the overall outlook for travel into the UK remained positive but hoteliers would have to focus on service, quality, outperforming competition and encouraging direct bookings. He said: “Next year will truly sift the good from the average, particularly in cities with an increasing supply of hotels such as London. Operators need to maximise revenue from every bit of space and keep a tight control on overheads. The message to tourists must be the UK is still very much open for business.”

Scottish business rates proposals are welcome trigger for wider reform, says ALMR: The Scottish business rates proposals are a welcome trigger for wider reform, the Association of Licensed Multiple Retailers (ALMR) has said. Scottish finance minister Derek Mackay has unveiled a set of new reliefs, which include almost all the Barclay Review recommendations. ALMR chief executive Kate Nicholls said: “The impact of business rates in the hospitality sector cannot be sustained so this package of measures is good news for Scottish pubs, restaurants and clubs. Better still is the move to Consumer Price Index, which the Barclay Review felt was outside its remit, will replace the higher Retail Price Index and larger businesses will benefit from a cut in the supplementary charge for large business premises, in line with England. Scotland is leading the way on business rates but there is still a real urgency for England and Wales to undertake root-and-branch reform of their systems to deliver fairness to bricks-and-mortar businesses and hospitality operators that are among the worst hit. This will hopefully prompt further and swifter action in England and Wales.”

London mayor taken to task for more than doubling night tsar’s pay: London mayor Sadiq Khan has been taken to task for doubling the pay of night tsar Amy Lamé, even though she has yet to meet with all the London boroughs. Khan was quizzed by London Assembly member Susan Hall, who said Lamé had only met with 18 of the 32 London boroughs during her time in office. Lamé has only held five night surgeries. Her pay was more than doubled to £75,000 in September, reports City AM. She previously worked two-and-a-half days a week for £35,000 and is now a full-time employee. But city hall Conservatives have been angered by the news she has also taken on a second job, replacing Jarvis Cocker on his BBC Radio 6 show. They have also criticised her failure to halt the pace of pub closures across the capital. According to the Campaign for Real Ale, 139 pubs have closed in 2017, up from 130 in the prior year. Speaking to Khan at mayor’s question time, Hall said: “I would have thought your night tsar would have wanted to meet all of the boroughs.” Khan responded by saying Lamé was meeting as many community leaders as possible, adding that her list of meetings was “very long”.

Clean eating, solo dining and activity-driven experiences among key trends for 2018: Clean eating, vegetarian and vegan haute cuisine, solo dining, and a growth in activity-driven experiences will be among the key trends in 2018, according to The Change Group. The recruitment company said other key trends next year would include catering to the growing number of dietary requirements, particularly gluten and dairy intolerances, and street food chefs combining top-calibre cooking with casual dining formats. It said the increase in solo dining would come as single people started to feel more comfortable eating out alone, while there would be a rise in experience hospitality where performance, dance and games add an extra dimension to the fine dining experience. The Change Group added that satisfying consumer behaviour would also be key, especially with millennials becoming a more significant proportion of the dining out public, while concerns over sustainability and nutrition would require restaurants to find new ways to attract people to eat out more often. The Change Group co-founder Craig Allen said: “Smartphone-empowered millennials now have a high disposable income and want something different from eating out. They love experiences and adventures. The rise in fine dining delivery services means they can get excellent food from many top restaurants at home, making the experience and ambience of dining out key to restaurant strategies. Additionally, millennials are well informed about nutrition and diet and are far more conscious about their food requirements than past generations. They have already helped to shift the avocado centre stage in every brunch experience and this is likely to be just the beginning.”

Company News:

Crussh reports like-for-likes up 2.9% in year of ‘significant developments’: Crussh, the London-based healthy food and juice brand, has reported like-for-like sales increased 2.9% in a year of “significant developments”. The company saw turnover increase to £14,404,673 for the year ending 2 April 2017, compared with £13,800,507 the year before. Ebitda fell to £61,739 compared with £269,294 the previous year, according to accounts filed at Companies House. Pre-tax losses were up to £451,728, compared with a loss of £241,418 the year before. In May, the company issued 1,500,000 10% fixed-rate convertible unsecured loan notes. The loan notes are repayable on 30 April 2042 or are otherwise convertible into shares by individual request of the loan note holders. The purpose of the issue was to provide working capital for store refurbishments and future growth. The company stated: “The year saw a number of significant developments for Crussh. Following the arrival of Shane Kavanagh as chief executive in spring 2016, he and the team created a platform for future growth, further strengthening the senior team, implementing several new IT developments, further shaping the Crussh brand direction, look and feel, developing range disciplines, and improving the capability of Crussh in the deliveries sector. During the year we refitted our main Canary Wharf store and opened a new-concept store in New Street Square. Trading throughout the year has been characterised by a contrasting store sales mix across the estate. Like-for-like store-level contribution grew by 2.9% to £1.82m in a year that saw unprecedented cost headwinds. Through decisive management actions, we were able to mitigate the majority of these cost pressures.”

Eco friendly Swedish coffee chain secures first two UK sites: Eco friendly Swedish coffee chain Wayne’s Coffee has secured its first two UK sites and plans to roll out the concept across the country. The first two cafes will be in Kensington High Street in west London and in Ilford, Essex, near the new Crossrail station. Negotiations are also under way for a further six sites to open in the next 12 months. KLM Retail is acting exclusively for Wayne’s Coffee and its UK master franchisee, Adnan Karim. He told Property Week: “Like numerous cities, London embraces responsibly sourced, organic produce that not only delivers great taste but also benefits the environment. These are our values, which is why we are so excited about introducing Wayne’s Coffee to the UK.” Ben Clark, of KLM Retail, added: “We are well versed at helping brands find a foothold in the UK and very pleased to have secured Wayne’s Coffee’s first two strategic stores. Londoners and visitors alike will embrace the Swedish concept of ‘Fika’ [meaning to have coffee] and the brand has ambitious expansion plans that we look forward to assisting further with.” Wayne’s Coffee was established in 1994 in Stockholm and currently operates 140 stores across Sweden, Estonia, Finland, Norway, Cyprus and Saudi Arabia. It offers sustainable and organic coffee, along with an extensive range of organic and vegetarian products, cakes, and other own-brand products such as cold-pressed juices and vitamin shots.

Clive Watson steps down as West Berkshire Brewery director: Clive Watson has stepped down as a director at West Berkshire Brewery to concentrate on growing City Pub Group following its initial public offering last month. Watson told Propel: “More and more of my time is being taken up by City Pub Group so the decision makes sense. It means there is no conflict of interest.” Watson, who is chairman of City Pub Group, joined the West Berkshire Brewery board in 2014. City Pub Group, the owner and operator of an estate of 34 premium pubs across southern England, now trades on AIM.

Indian Accent makes UK debut in Mayfair: Old World Hospitality has opened a first UK site for its Indian Accent brand. The company has launched the venue in Albemarle Street at a site formerly occupied by its restaurant Chor Bizarre, which had been there 20 years and featured on the world’s best 50 restaurants list. Old World Hospitality operates Indian Accent sites in New Delhi and New York, with group chef Manish Mehrotra’s menu featuring home-style cooking using unusual ingredients from across the globe. The restaurant’s decor features combed, pearl-lustred plastered walls, reminiscent of Indian Accent’s other sites, while the lower ground floor offers private dining. Old World Hospitality founder and chairman Rohit Khattar said: “The decision to close Chor Bizarre was hard. However, it did need major refurbishment after so long and, while we were looking for a home for Indian Accent, we realised there was no space more perfect. We hope London embraces Indian Accent as warmly as New York has.”

South coast-based barbecue brand Casa Brasil expands into Bristol: All-you-can-eat barbecue brand Casa Brasil, which operates sites in Brighton, Portsmouth and Southampton, has launched its fourth venue, in Bristol. The new restaurant is on the top floor of the Cabot Circus shopping centre offering a “vibrant, exotic atmosphere” under the slogan “come hungry, leave happy”, the Bristol Post reports. At Casa Brasil, diners eat unlimited food for a set price, including unlimited trips to a gourmet salad bar and a selection of traditional Brazilian hot dishes in addition to unlimited rodizio, where passadores serve barbecue meat on skewers that are carved at the table.

Starbucks to sign up estate to plastic-saving app: Starbucks hopes to sign up its entire UK estate by early 2018 to the Refill app, in which hospitality businesses are encouraged to let the public refill water bottles for free rather than buying new ones. Starbucks vice-president of corporate affairs Simon Redfern said the company is currently in talks with developers of the app, which is already available in Bristol. Speaking to edie ahead of his appearance at the Sustainability Leaders Forum in January, Redfern said: “We’ll add ourselves to the Refill map and (consumers) can ask for water without having to buy anything. These are really easy wins for us where we can make a big material difference to the amount of plastic people are using. Ultimately, we believe in providing choice for customers and the way they consume their beverage.” Redfern also said Starbucks was working with furniture company Pentatonic to trial products made from post-consumer waste. “Bean chairs”, counter tops and tables have been produced using upcycled textiles made from plastic waste.

Ei Group partners with Devon-based chip shop operator to launch US-themed seafood offer: Ei Group’s leased and tenanted division Ei Publican Partnerships has partnered with a Devon-based fish and chip shop owner to launch a US-themed seafood offer. Daniel Boatwright, an experienced publican, hotelier, restaurateur and chef, took over The Old Coach House Inn in Torquay in October. Working with daughter Sophie, they have reopened the pub as American-themed seafood venue Route 16 following a joint £155,000 investment with Ei Publican Partnerships. Renovations include a New England-themed interior and a herb terrace in the newly designed garden. The menu includes New England clam chowder, and Alaskan-fried fish and chips. A hot smoker has been installed on the terrace for barbecues. Daniel Boatwright said: “My family and I jumped at running this much-loved pub. We have previously run pubs in Kent and currently own a fish and chip shop in town. It will be an all-family affair as my daughter is keen to follow in our footsteps and will manage front of house.” Ei Publican Partnerships regional manager Alan Turner added: “Daniel is the perfect example of the publicans we have in our estate. I have no doubt he and his family will thrive at Route 16.”

Hollywood Bowl signs for Intu Broadmarsh redevelopment and Yeovil site: Hollywood Bowl Group, the UK’s largest ten-pin bowling operator, has signed to open at the Intu Broadmarsh shopping centre redevelopment. The company has committed to a 22,000 square foot space next to co-anchor The Light cinema. The redevelopment will also include restaurants and is due to be completed in 2020. It has been designed to complement the offering at Intu Victoria Centre, which is also in Nottingham. Hollywood Bowl recently signed for space at Intu Lakeside and Intu Watford, and opened at Intu Derby earlier this year. Hollywood Bowl Group chief financial officer Laurence Keen said: “Intu is leading the way in driving growth in retail and leisure and its prime, high-footfall destinations enable us to execute our new centre opening strategy across its UK-wide portfolio.” Intu development director Martin Breeden added: “Hollywood Bowl will give our customers another great reason to visit our centre and stay for longer. It will be part of a great tenant mix that will help our retailers and restaurants flourish.” Meanwhile, Hollywood Bowl Group will open a site in Yeovil, Somerset, in the spring after taking over a tenpin bowling alley at Yeo Leisure Park that was formerly operated by MFA Bowl but closed in September. Earlier this week, Hollywood Bowl Group reported sales up 8.8% to £114m for the year ended 30 September 2017, with like-for-like sales up 3.5%. Group adjusted Ebitda was 13.7% to £33.4m.

Hop Stuff Brewery secures Kent venue for first site outside London: Hop Stuff Brewery, which raised almost £750,000 on Crowdcube earlier this year for expansion, has secured a venue in Ashford, Kent, to add to its SE18 brewery taproom in Woolwich and SE8, which opened in Deptford on 1 December. The company’s third taproom will launch in Bank Street early next year at a site formerly occupied by Vinnie’s Bar And Club in a deal brokered by agent Christie & Co. The venue is a 3,500 square foot, ground-floor corner plot close to the town’s new cinema. The property is owned by a private landlord who set up a new lease. Hop Stuff Brewery will refurbish the venue to feature a micro-brewery alongside sourdough pizza, its own craft beer, and a small selection from other brewers, particularly from Kent. Last month, Hop Stuff Brewery founder James Yeomans told Propel he was considering another crowdfunding round to accelerate the growth of his taproom concept. He said: “We’re very excited to have our first site outside London and I don’t want to stop growing. We’ve managed three taprooms and a new brewery with the funds so far and I’d love to have taprooms across the south of England.” Yeomans said he expected revenue to hit the £3.5m mark in 2018.

JD Wetherspoon submits plans for long-awaited Grays pub at former cinema: JD Wetherspoon has submitted plans for its long-awaited site in Grays, Essex (population: 66,843). The company acquired the site of the former State Cinema in George Street for an undisclosed sum in 2015. Now it has submitted plans to Thurrock Council for the pub, which will have capacity for 475 customers inside. The plans include a beer garden, while the organ that was used at concerts will be restored and left to sit on the stage.

Ivy Collection launches brasseries in Cheltenham and York: The Ivy Collection has opened two brasseries, in Cheltenham and York. The Cheltenham site has opened in the grade I-listed Rotunda building in Montpellier that formerly housed a Lloyds TSB bank branch, while the 120-cover York venue is in St Helen’s Square at a former Blacks outdoor clothing shop featuring a marble-top bar, pendant lighting, leather banquettes and artwork reflecting the city of York. Last week, The Ivy Collection opened Granary Square Brasserie in King’s Cross, while there are further openings lined up for early next year in Guildford, Leeds and Winchester.

New coffee house concept 39 Steps to launch in Soho next month: New concept 39 Steps Coffee Haus is to launch in Soho next month. The 25-cover venue in D’Arblay Street will roast and grind coffee on-site, with experts able to tell consumers the name of the farmer who grew the beans, which way the slope faced and how long the beans ripened for. Head roaster Jens Rettig buys beans from independent growers in India, Brazil, Mexico and El Salvador. The venue will also offer hand brews, cold brews, nitro brews, coffee smoothies and coffee milkshakes alongside cold-pressed juices. The all-day menu will feature homemade soups, salads, sandwiches and freshly made cakes and desserts.

Liverpool-based craft beer and gin bar opens second site: Liverpool-based craft beer and gin bar Hard Times And Misery has opened its second site, in Crosby. The company has opened the venue in Moor Lane on the site of the former Mimi’s Cafe having agreed a deal with landlord St Modwen. Jen Peterson, who owns Hard Times And Misery with husband Greg, told The Business Desk: “Hard Times And Misery was born out of a love for great beer and amazing gin, and we’re really excited to share our passion with the people of Crosby.” The Petersons opened their first site, in Maryland Street in Liverpool city centre, in 2016. Lambert Smith Hampton and Pinsent Masons represented St Modwen in the deal.

Pizza Hut reviews £10m advertising account: Pizza Hut is reviewing its £10m advertising account. AAR Group is handling the review and current incumbent Ogilvy & Mather London is understood to be weighing up whether to repitch, reports Campaign. Pizza Hut has appointed a number of new marketers this year. In August, Stephan Croix joined as chief sales and brand officer for Europe and the UK from Starwood Hotels, while Beverley D’Cruz became UK sales and marketing director at the same time. D’Cruz was previously marketing director at fellow Yum! Brands company KFC in Canada.

Signature Living signs with Wireless Social to cut commission fees and drive repeat business: Aparthotels developer and operator Signature Living has appointed Wi-Fi solutions provider Wireless Social to capture customer insight across its estate. The data will help Signature Living communicate with guests on a personal level for repeat bookings, cutting out an average commission fee of 18% from travel sites. Wireless Social’s Wi-Fi platform will collect customer data at log-in, allowing for tailored communications to drive direct bookings and positive TripAdvisor reviews as well as enabling targeted Facebook advertising. Signature Living co-owner Lawrence Kenwright said: “We want to really get to know our customers and, through Wireless Social’s platform, we now have the opportunity not only to find out more about our customers but to personalise our communication to them, helping build relationships and encourage repeat business.” Wireless Social managing director Julian Ross added: “Wireless Social is committed to helping the hotel sector tailor communications and enhance every guest experience. This is evident through our current hotel renewal rate of 77%.” Last month, Signature Living lodged plans for its first site in Manchester. The company operates a number of hotels in Liverpool while other projects in the pipeline include a George Best-themed hotel in Belfast.

Whitbread appoints Engine to redesign Costa Coffee website: Whitbread-owned Costa Coffee has appointed Engine to reimagine and redesign its website following a competitive pitch. Engine’s partners, Andrews Aldridge, will review and refresh the coffee company’s customer digital journey. Digital product agency Graphite will continue to manage the Costa UK website, reports Campaign.

Former MasterChef quarter-finalist launches Malaysian coffee shop concept in Glasgow: Former MasterChef quarter-finalist Julie Lin MacLeod has launched Malaysian coffee shop concept Kopitiam in Glasgow. The venue has opened in Pollokshaws Road at a site formerly occupied by Cafe Strange Brew. MacLeod, who appeared on the BBC television series in 2014 and still features on programmes on the STV network, operated food stalls in the city until opening her first restaurant, Julie’s Street Kitchen. MacLeod has brought that menu to Kopitiam, which features dishes inspired by her Malaysian mother, the Glasgowist reports.

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