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Morning Briefing for pub, restaurant and food wervice operators

Tue 27th Aug 2013 - Davy’s, Greene King, Loungers, the Cotswolds and Wetherspoon

Story of the day:

Cheshire Cat Pubs boss attacks Camra’s £1.5m support for Wetherspoon: Tim Bird, founder of Cheshire Cat Pubs and Bars, has written to Camra chairman Colin Valentine to criticise the consumer body’s £1.5m indirect support of JD Wetherspoon. Camra members receive 40 vouchers for 50p off a pint at JD Wetherspoon each year when they renew their membership. Bird has told Valentine: “Camra is supposed to be independent, representing the hard-working publicans running their pubs and delivering great cask ale across the country as a whole. Yet you still encourage all your members to drink with one operator. You are offering discounted pints to the tune of 40 pints per member. At the last count you had 153,799 members. Each member saves £20 when drinking purely at Wetherspoon but Wetherspoon gets 40 times £2.50 per member (based on a pint being £3 before the 50p discount), which is a nice round £100 per member that Wetherspoon earns out of this. If, say, 10% of members take up the offer, Wetherspoon gets £1.5 million plus in extra revenue generated by you every year. This is removing £1.5 million from the hands of the very publicans you say you represent. It is simply scandalous!”

Industry news:

Propel Multi Club Conference: The next Propel Multi Club Conference takes place on Thursday 7 November at One Moorgate Place. London. Operators can claim up to two free delegate places by e-mailing jo.charity@propelinfo.com

Davy’s wins appeal against rare beefburger ruling: Wine bar operator Davy’s has won an appeal against a Westminster City Council ruling that beefburgers served rare are a health risk. District judge Elizabeth Roscoe ruled: “There is a balance to be struck between ensuring the safety of the public and allowing them the freedom of choice they would wish and have a right to expect.” The council wanted Davy’s beef supplier to sear and shave the outside of whole cuts of meat to remove any harmful bugs. Davy’s argued that its suppliers could be trusted to supply beef that could be safely eaten. Westminster health chief James Armitage said: “We are not saying beefburger should not be eaten rare or medium – merely that they should be prepared in a way that makes them as safe as practicably possible.”

Jamie Oliver – the poor are wasting money on convenience foods: Jamie Oliver has criticised struggling families who waste money on buying expensive ready meals. He argued that it was hard to talk about modern-day poverty because cash-strapped families do not budget effectively. He said: “I just want to hug them and teleport them to the Sicilian street cleaner who has 25 mussels, ten cherry tomatoes, and a packet of spaghetti for 60 pence and knocks out the most amazing pasta. You go to Italy or Spain and they eat well on not much money. We’ve missed out on that, somehow.”

CBI – pubs and restaurants hit by rising costs: The warm summer boosted trading at the UK’s pubs, restaurants and hotels. But profits were hit by rising raw materials and competition keeping prices low, according to the CBI’s quarterly service sector review. Business activity in the sector grew to the highest level since 2007 as confidence rose sharply. But in consumer services, which includes the travel and leisure industries, profits dropped unexpectedly as price growth stalled.

Toyota opens luxury Lexus cafe: Toyota is trying to shake off the staid image of its luxury brand Lexus by opening a cafe in Tokyo’s Aoyama district – the cafe features a single model of a new Lexus on display. Other sites are set to open in New York and Dubai, as the brand tries to highlight recent redesigns of some of its top models. “This is about showing people the personality of the Lexus brand, and showing a more emotional part of Lexus,” said Mark Templin, executive vice-president of Lexus International.

US fast food chain pioneers on-site garden: US fast food chain B.Good, which stresses its sustainable and healthy credentials, has pioneered on-site gardens at two of its sites in Boston, Massachusetts. Now, as it expands from its dozen locations and starts franchising, B.Good plans to make gardens a permanent part of its business model – its first-ever franchisee is already setting one up. B.Good co-founder Jon Olinto said: “I think you have to take a more macro view – it reinforces what our brand is supposed to be about.”

Colliers – just about everything in the Cotswolds is under offer: Property agent Colliers International has reported that strong demand for pubs and hotels in the Cotswolds has almost cleared its existing stock. Colliers International director Peter Brunt said: “I have offers on the table for just about every hotel and pub we have on our books in the area. For the first time in years I have almost nothing to sell. People who thought they could take their time and wait for bargains are missing out as properties are being snapped up under their noses.”

Company news:

Details of first Realpubs site outside London confirmed: Greene King will open the first Realpubs site outside London with the conversion of riverside The Anchor on Silver Street in Cambridge city centre to the premium format. The venue is scheduled to launch on Friday 4 October after a four-week refurbishment. It will feature a 50-cover first floor serviced dining room and a refurbished lower bar area with five changing cask ales and a selection of craft beer and cider served from a back bar dispenser. The pub’s river terrace, facing the Cam’s Mill pond, will have a summer serviced dining area. The founding member of Pink Floyd Syd Barrett was a regular at The Anchor riverside bar during the 1960s and the riverside bar now boasts a lasting tribute to his legacy in the form of a special commissioned mural. Greene King is planning two more conversions of London pubs to its premium Realpubs format – The Salt House in St Johns Wood and The Wilmington Arms in Clerkenwell. The Greene King annual report, issued at the start of this month, stated that it had achieved in excess of a 33% Return on Investment on the seven sites it had converted so far but that returns were expected to reduce over time. Greene King acquired Realpubs for £53.1m in May 2011.

Loungers thwarted on Leicester site: Cafe bar operator Loungers has been thwarted on a new site that would have meant a first opening in the hometown of founders Alex Reilley and Jake Bishop – Leicester. The company had been eyeing a site in the upmarket Leicester enclave of Clardendon Park. However, the company tweeted last week: “Lost out on a site in Leicester to Tesco – sure the good people of Clarendon Park will be well chuffed with another convenience store, not.” Tesco has denied it is planning to open at the site, a former Barclays Bank on Queens Road. Loungers is set to debut in the county this Thursday (29 August), opening Mercado Lounge, in nearby Market Harborough. 

Tom Kerridge – we’re extending the Hand & Flowers to cater for real ale drinkers: Tom Kerridge, the first chef to win two Michelins star at a pub, is to extend his Hand & Flower pub, a Greene King site in Marlow, to cater for real ale drinkers. Kerridge told The Guardian that he also plans to brew on site. He said: “We originally set out to have the four tables in the bar as drinkers only, but as the reputation grew people would say ‘can I eat there?’ and we’d say of course you can. So we are having an extension built, and it’s not to increase the number of tables (for eating). It’s to encourage real ale drinking.”

OHH Pub Company buys Wadworth freehold, takes Fuller’s tenancy: OHH Pub Company, the three-strong south west operator led by Mark and Matt Warburton, executive chef Chris Alderson and front-of-house specialist Jamie Coulson has acquired the freehold of The Northey Arms from Wadworth after agreeing an option to purchase the freehold two years ago. The company has spent two years developing the site with five boutique rooms. Mark Warburton told Propel: “We also took over The Bear & Swan, Chew Magna just 12 weeks ago as a Fuller’s tenancy as we aim to build relationships with further brewers and landlords. We aim to expand to eight to 12 sites over the coming five to seven years.”

Pring and Heap’s second pub to build outside bar to cope with customer numbers: London Ordinaries, the company led by Michael Buurman where Nick Pring and Malcolm Heap are silent partners, has won rave reviews for its second opening, The Crooked Billet in Upper Clapton, an Enterprise Inns free-of-tie lease. The company is now building an outside bar to cope with customer numbers – and is planning to host a food truck at the site on Saturdays. The venue re-opened last month as a “drinking pub” as compared to the company’s other pub The Empress of India, a pub acquired from Tom and Ed Martin’s ETM Group in March 2011 that is more food focused. The Crooked Billet menu has a focus on classic pub dishes – steak and ale pie, fish and chips and sausages. A spokesman said: “Since we’ve been open we have had literally hundreds of people telling us how they have lived in the area for years and never fancied going in until now. And that isn’t just young hipsters who have lived in Clapton for a year or two – I’m talking people in their 60s that have never ventured in either.” London Ordinaries has boosted trading space by developing the car park. “We didn’t really see the point of a car park in a pub in London when you can’t drink and drive. We’ve put outdoor table tennis, table football and darts outside and great little private booths with speakers and heaters in. We are now building an outdoor bar to cope with the numbers of people coming down to use the gardens. We want to start doing truck food on Saturdays and we are talking to a few people that have great truck concepts and seeing how that could work out.” Pring and Heap left Greene King earlier this year and are blocked from active business involvement for six months under the terms of their exit from the company.

Risk Capital takes majority stake in Red Hot World Buffet: Risk Capital, the private equity firm headed by Luke Johnson, has acquired a majority stake in Red Hot World Buffet, the restaurant company headed by Paramjit and Helen Dhaliwal. The deal has taken three years to reach fruition and as recently as a fortnight ago there were market rumours that the deal would not happen as the Dhaliwals investigated alternative funding routes. The new funding will pay for restaurant upgrades and pay for an eighth venue. The company was founded by the Dhaliwals in 2004 and its latest opening at Nottingham Cornerhouse is serving 8,000 customers a week.

Newcastle’s Head of Steam to extend trading hours in response to Late Night Levy: Newcastle multi-site operator Head of Steam is to extend trading hours at a site in response to the local authority’s decision to impose a Late Night Levy. Managing director Tony Brookes said: “Our company has four licensed premises in Newcastle and three of them – the Cluny, The Head Of Steam and Tilleys Bar – will each be paying £1,259 a year extra – for nothing. The cost goes straight off any profit the pub may be making. The council and police are hoping that the new Late Night Levy will encourage some pubs to bring their closing times back from the early hours to midnight, so that no levy would be chargeable. But it may work in reverse. Pubs with after-midnight licences, which will have been hard fought for in earlier times, will not be varied lightly. A pub that usually closes at or before midnight, but that has a licence to open later, may now start to use its facility. And so it is with one of our company’s pubs – Tilleys Bar at 105 Westgate Road, next to Tyne Theatre, just outside the city centre. The pub closes at 11pm during the week and midnight Friday and Saturday. We considered taking up the council’s offer of a free-of-charge variation to our licence to bring it back to midnight. But, instead, we are going to experiment opening until 1am on Friday and Saturday and midnight Monday to Thursday. It will be interesting to see if we can generate extra trade to make it worthwhile.”

The Independent – 16 franchisees lose out in Lavazza franchise collapse: The Independent reports that at least 16 franchisees have lost their £24,000 deposit after signing up with Catalyst Retail which held the master franchise rights to the Lavazza coffee shop brand. On Monday, Catalyst Retail was ordered to shut by the courts following a winding-up petition brought by six people who are owed money. Lavazza plans to roll over franchisee agreements to its yet-to-be named new partner for those still interested in opening a Lavazza Espression store. In a statement, Lavazza UK said it is “in the process of appointing a new master franchisee which the company is hoping to be in a position to announce next month in line with the progression of the legal process”. 

Former Anthony’s site in Leeds taken over by expanding Dish: The premises once occupied by the flagship of the Anthony’s restaurant empire in Leeds, which collapsed in June, is being taken over by an award-winning newcomer. Dish, which was named best newcomer at The Yorkshire Evening Post’s eating-out awards earlier this year, is moving from Great George Street in Leeds city centre to the building in nearby Boar Lane formerly home to Anthony’s, opening its doors on Monday 2 September. At the same time Dish’s owner and head chef, Eddy Nuttall, is turning Dish’s old home into a bar and brasserie called Harry’s Bar & Brasserie, serving “the best in cocktails, wines, food and live music”. Nuttall told The Yorkshire Evening Post: “We are relocating to enable us to have bigger premises to serve our growing band of customers. We are creating a stunning dining room on the lower level and introducing a fabulous cocktail bar on the ground floor.” Anthony’s, part of a small group of eateries built up over the past ten years by the chef Anthony Flinn, moved from Boar Lane to Leeds Corn Exchange in March, but closed three months later, along with Flinn’s other outlets, Piazza by Anthony, Rib Shakk and Anthony’s Patisserie.

Yummy Pub Company seeing triple digit growth: Yummy Pub Company, the four-strong operator headed by Tim Foster and Anthony Pender, has reported triple-digit growth. Writing on his blog, Foster stated: “We’ve smashed all budgets and forecasts to pieces. We’re posting the best performance we have ever achieved at not just one, or two, or three, but all four pubs. Not many companies can boast of a mid-single digit growth in 2012/13 or even a low to mid double-digit growth – but I don’t know of any that can post a triple digit growth in mature businesses.” Foster reported that the company’s oldest site, The Wiremill at East Grinstead is in growth despite two major new openings in the vicinity, including Marston’s Revere Pub Company site The Curious Pig in the Parlour.

Intertain closes Leeds Walkabout: Intertain has closed its Walkabout site in Leeds, which first opened in November 1999. The venue was split into Walkabout and cocktail bar Masseys City Booksellers in 2011 – both bars have closed. A spokesman for the company said: “While we are very disappointed to be closing, it will allow us to further focus on our national investment plans which have already seen the complete refurbishment of 13 venues across the UK, creating hundreds of new jobs. We have plans for more refurbishments over the next 18 months, and in due course, the acquisition of new Walkabout venues, so this is an incredibly exciting time for the brand.”

Northampton nightclub has licence revoked – eights months after opening: A nightclub where bouncers were seen punching, kicking and spitting at revellers could close after “appalled” councillors stripped it of its licence just eight months after it opened. Northamptonshire Police raised “grave concerns” over the management of Lost, in St Peter’s Square, Northampton, which only opened in December last year. The club’s licence was revoked at a meeting of Northampton Borough Council’s licensing sub-committee, but it will stay open under appeal.

Punch takes Richmond Arms off market: Punch Taverns has announced that it has taken The Richmond Arms pub in Lansdown, Bath off the market after planners in the city rejected the company’s application to turn it into a family home. The Save The Richmond Arms group was planning to make a bid for the pub, after it was formally registered as a community asset. Campaigners are still hoping they will be able to take the pub over. The chairman of the Save the Richmond Arms group, Colin MacAusland, told the newspaper: “We are currently drawing up a detailed business plan and we are forming an industrial and provident society in readiness for the next step, which may be to buy the pub.”

Simon French – Restaurant Group shares worth buying: Panmure Gordon leisure analyst Simon French has reiterated a ‘Buy’ note on Restaurant Group shares ahead of Friday’s interim results, with a Target Price of 560p. He said: “We forecast 14% growth in earnings to £28.9m profit before tax (10.9p EPS) and a 15% increase in the dividend to 5.3p. We expect current trading trends will be resilient, albeit showing some impact from the warm weather that has reduced footfall to restaurants.”

Former Fat Cafe site re-opened by staff consortium: A former Fat Cat Cafe site in Stoke-on-Trent is to re-open after a consortium of former staff took over the lease. Hanley’s Fat Cat Cafe closed down in April, with the loss of 16 jobs after Derby-based Fat Cat Cafe Bars fell into administration. But now the Trinity Street site will re-open next month, rebranded as The Exchange. The move was made possible after a five-strong group of former staff members formed the consortium and signed a six-year-lease for the building.

Antic London to open Galvaniser’s Union in Bromley by Bow: Antic London, headed by Anthony Thomas, is to open The Galvaniser’s Union on the site of a disused pub in Bromley by Bow as part of redevelopment work expected to finish in January 2014. Thomas said: “It will be a good old pub, what we think a pub should be. A safe comfortable space where people want to spend time and have drinks at a reasonable price. That’s what a good pub is all about to me.”

Marston’s rebrands fire-hit pub for opening: Marston’s is to re-open the former Dog & Duck in Redhill, close by a major fire in February, as The Tower this Friday (30 August). Extensive refurbishments of the interior and exterior of the building have taken place, and cocktails are due to be a feature of the new pub, along with an extensive wine selection and a dance floor for late night entertainment. New license Adam Kick said: “We know the site needed a major overhaul and we hope people will be impressed with what we have done. As well as all day coffee, food and drinks, we will also be offering a fantastic late night experience.”

Tenant attacks councillors trying to save pub: The tenant of a Yorkshire pub threatened with closure has attacked local councillors who want it classified as an “asset of community value”, with villagers given the opportunity to buy it. The freehold of the Grade II listed Bay Horse Inn at Oxenhope, near Keighley, is on the market for £295,000. The three local councillors for the area in Bradford Council fear the pub could be converted to another use by a potential buyer. One, Glen Miller, told The Keighley News: “The Bay Horse is a proper community pub, and in recent years we have seen too many village pubs closing down. Quite often communities have been sad to see their local, which is often an important part of community life, closed and turned into something different. There has often been a sense of inability to do anything, and once the pub is gone it is gone.” However, the pub’s tenant, Karen Ward, told the newspaper she could not understand why the three councillors were getting involved. She said: “If local people supported the pub, then it wouldn’t be up for sale. 90% of locals don’t support the pub. I don’t make enough money, and I work there full-time.”

Restaurant developer balks at paying for public art: A developer preparing to go ahead with a scheme for a drive-through restaurant that was granted permission in 2008 is now arguing it should not have to pay the £25,000 for public art agreed as part of the original planning deal. The development, on the edge of Truro in Cornwall, was given planning permission subject to the developer paying for traffic improvements and new paths for cyclists and walkers to improve access to the site, just off the A390. Carrick Council also approved a retail unit for the site, provided the developer paid £25,000 for public art alongside. The development was delayed by the recession, and developer Walker Developments, the company behind the scheme, now says the requirement for public art is unfair. Damien Burley, a Walker Developments director, told The West Briton newspaper: “At the time Carrick had an aspiration to have public art which we agreed to. No other development has made this contribution and there is no policy for it. Why should we pay for public art if nobody else has to?” Money would be better spent on the necessary highways improvements, he said. Burley said he could not confirm which restaurant chain was looking to take the site.

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