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Wed 28th Mar 2018 - Update: Time Out signs market site in New York, pub performance versus restaurants
Time Out lines up Time Out Market in New York: Time Out Group, the global media and entertainment business, is pleased to announce that it has signed a conditional lease agreement for a new Time Out Market in New York. Located at 55 Water Street, Empire Stores in Brooklyn’s Dumbo neighbourhood, Time Out Market New York is expected to open in Q4 2018. Built between 1869 and 1885 as a coffee storehouse, the historic Empire Stores have retained their original brick and timber features; recently redeveloped, they have been transformed into a highly desirable retail, office and commercial space. With its unique waterfront position right by the East River, between Brooklyn Bridge and Manhattan Bridge, Time Out Market New York will be at the heart of an increasingly popular area for locals and visitors. Time Out Market New York will occupy 21,000 sq ft over two distinctive floors of Empire Stores, accommodating around 520 seats indoors and outdoors. There will be a curated mix of 20 food offerings, three bars, a stage for cultural activities and exhibition space – all representing the very best of New York. The Time Out Market rooftop on the fifth floor will offer impressive views of the East River, the two iconic bridges and Manhattan’s skyline. Time Out Market brings the best of the city together under one roof: its best restaurants, bars and cultural experiences, based on Time Out’s editorial curation. The first Time Out Market opened in 2014 in Lisbon and saw 3.6 million visitors in 2017. This month, it received an international award recognising Time Out Market Lisbon as one of the most visionary concepts in the European food service sector. The group is now rolling out Time Out Market globally with new sites set to open in Miami in Q4 2018 and in Boston and Chicago in 2019. The lease agreement for Time Out Market New York is conditional on obtaining a license approval and building permits. Julio Bruno, chief executive of Time Out Group, stated: “New York has been home to Time Out since 1995, and millions of people – locals and visitors – use our website and read our magazine to make the most of the city. Now we have a breathtaking location for Time Out Market in New York. It will offer not only the city’s best food, drinks and culture, but also one of the city’s best views. Time Out Market has proven to be a real success story and that is why we have an exciting pipeline for new Time Out Market openings in some of the world’s most amazing cities. I have lived and worked in New York City for many years and today I feel very proud that we are bringing this unique experience to this city.” Didier Souillat, chief executive of Time Out Market, added: “With Time Out Market we are bringing something new and unique to New York. It is a culinary and cultural experience that can’t be found anywhere else, based on editorial curation. It will be located in a space full of character, history and authenticity. There aren’t many cities in the world that offer such an incredible food scene and cultural life like New York – our experienced team of editors will select and invite the city’s best to make Time Out Market a must-see destination in this vibrant neighbourhood.” The company reported revenue from Time Out Market grew by 62% to £6m in 2017 driven by 3.2 million visitors (2016: 3.1 million). Bruno added: “Strong growth in e-commerce and Time Out Market continued in 2017, demonstrating that we are successfully evolving Time Out into a transactional business. Millions of customers now book theatre tickets, attractions and hotels with us, buy exclusive offers and experience one of our Live Events worldwide and Time Out Market. I am excited about the year ahead as we continue to capitalise on the substantial progress made to date. Time Out launched 50 years ago to help people explore the best of London and today we are the only true global marketplace for city life, with a presence in 108 fascinating cities worldwide. Time Out enters a new financial year in a strong position with further progress anticipated throughout 2018 in both Time Out Digital and in Time Out Market.”

Douglas Jack – pubs and restaurant is a tale of two sector: Peel Hunt leisure analyst Douglas Jack has published a note pointing out the divergence in performance between pubs and restaurants. He stated: “Ahead of March’s snow, the like-for-like trends in January-February provide a good reflection of the developing themes within the managed licensed retail sector: 3% year-on-year supply growth in both pubs and restaurants; +1.2% average like-for-like sales in pubs versus -0.6% in restaurants; and private restaurants utilising CVAs to remove their most unprofitable sites and reduce costs elsewhere. Since 2007, the number of pubs has fallen by 20%, and the number of restaurants has grown by 24%. In both cases, the number of managed outlets is still growing, whereas the number of leased pubs is in constant decline. Due to changes in planning laws and the recovery in drink sales, we expect pubs’ supply reduction to slow. Restaurant supply grew by 0.6% in 2017; we do not expect it to collapse in 2018, as many CVA sites will likely be run for cash. Prezzo read-through. Prezzo, which was quoted in 2014, suffered an 8% decline in like-for-like sales in 2017, which we believe was no worse than RTN’s performance outside pubs and Concessions. The closure of 94 (of 300) sites and 25-50% rent reductions in 57 sites is expected to help boost Prezzo’s margins by 500bps. The key questions are: how much of this new firepower will be used for discounting; and with the infrastructure already in place, how many of the 94 closed sites will reopen under a new restaurant format? For Restaurant Group, with £0.5bn of equity value, we believe a CVA is less of an option if its like-for-like sales continue to fall; a rights issue would not solve the core supply and market positioning problems; and a sum-of-the-parts valuation is invalid if shareholders cannot extract the value in the pubs and Concessions. Deep value is emerging in the pub sector, in which our favoured stocks have good drink-led exposure: Ei Group, with a 20% equity FCF yield, and Marston’s with a 7.7% dividend yield (13% equity FCF yield).”

McDonald’s UK to phase out plastic straws: McDonald’s is to start phasing out plastic straws from its UK restaurants and says it is “really close” to the point where all its packaging can be recycled. The company, which has around 1,300 restaurants around the country, will start a trial in May to use paper straws instead of the normal plastic ones. It will also try out a scheme where straws are kept behind the counter, and only given out to customers on request. McDonald’s has around 3.7 million customers every day, with 90% of the UK population visiting one of its restaurants in the average year The announcement was made by McDonald’s chief executive Paul Pomroy in an interview for Sky News. He said: “Customers have told us that they don’t want to be given a straw and that they want to have to ask for one, so we’re acting on that. Straws are one of those things that people feel passionately about, and rightly so, and we’re moving those straws behind the front counter. If you come into McDonald’s going forward, you’ll be asked if you want a straw. The other thing we’re looking to do is to move to recycled paper on the straws and biodegradable paper straws and that test, I’m really proud to say, will start next month.” The plastic straws presently used in McDonald’s restaurants are recyclable but the company has reacted to growing public discontent about their use. The UK is reckoned to use around 8.5 billion single-use plastic straws each year

Frankie Goes To Bollywood fails to reach in £100,000 crowdfunding campaign for second site: Frankie Goes To Bollywood has failed in its £100,000 fund-raise on crowdfunding platform Crowdcube to open its second venue. The company, founded by Monty Bhurjee, who has run street food concept Popdogs for about four years, was offering a 16.67% equity stake in the business in return for the investment. Frankie Goes To Bollywood opened its first site in Deptford, south east London, in 2016 and has outlined plans for a five-strong estate in the next three years.

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