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Morning Briefing for pub, restaurant and food wervice operators

Wed 26th Feb 2020 - Propel Wednesday News Briefing

Story of the Day:

BrewDog’s David McDowall attacks points-based immigration system: BrewDog chief operating officer David McDowall has launched an attack on the government’s proposed new points-based immigration system. In a message posted on his Twitter feed, he wrote: “Hospitality is an awesome antidote to the nationalist, anti-immigrant rhetoric that’s turning us into a nation more and more removed from a world that should be getting smaller, not more divided. However, the Conservative government’s newly announced points-based system will do a brilliant job of destroying that. Firstly, because we will eventually have a far less diverse and multicultural group of people working in (and growing careers in) our hospitality industry, and secondly because we will close restaurants, bars and cafes around the country in droves as they buckle under the weight of an unsustainable workforce availability crisis. I, and the other directors at BrewDog, still work shifts behind our bars and with our packaging teams as part of our ‘Dogs On Deck’ programme, designed to ensure the people who are leading the strategic decision-making in our business never make those decisions without a clear understanding of what’s happening closest to our customers. These shifts are powerful, insightful, exciting and restorative experiences for me and I would run a far less successful business and team without that programme in place. Wouldn’t it be fun to see Priti or Boris attempting to handle a ‘low-skilled’ Dogs On Deck shift in a BrewDog bar or work a shift in a Hawksmoor, Pret, Wagamama or any of the other awesome hospitality sector businesses that rely on a passionate, driven, experienced and skilled workforce day in, day out. We work with a vibrant, determined, resilient and resourceful community. We will no doubt find a way but the UK government just made it harder than ever by quite some way. Let’s make sure last week’s noise and fury at this news from all corners of our fabulous hospitality industry is amplified hard in the weeks and months ahead.”

Industry News: 

Majority of diners happy to exchange their email address for meal discounts: The majority (88%) of diners will happily hand over their email address in return for meal discounts but only 9% of millennials will share social media profiles, according to a new survey by guest experience management expert HGEM. Money off food is the top incentive for customers, the study found, with almost two-thirds (65%) of respondents saying even a free drink would suffice. However, only 41% of diners would share personal data in exchange for free Wi-Fi, perhaps indicating this has become expected as standard. The best time for operators to request personal information from guests is during the booking phase, with more than half (53%) of respondents identifying it as the best point to share personal data. Only 2% would be prepared to divulge personal information during their meal. Once data has been collected more than half (51%) of respondents would only wish to be contacted once a year, suggesting customers aren’t eager to frequently receive promotional offers, although more than one-third (35%) would be happy to be contacted once a month. HGEM founding director Sally Whelan said: “How comfortable diners are in giving their own personal information to pub and restaurants operators has been a particularly prevalent topic in our industry since GDPR. While diners are more likely to provide personal data, there’s a clear opportunity for operators to offer incentives that are appropriate and seen as rewarding for diners. Integrating these findings will no doubt have a beneficial impact on communication with customers and, ultimately, repeat bookings.”

Brian Turner recognised for services to hospitality: Chef Brian Turner has been awarded The Restaurant Association Award for services to hospitality. He received his award from fellow chef James Martin during a ceremony at The Savoy Hotel in London, which raised £25,000 for sector charity Hospitality Action. Turner said: “I hold this award for a lot of people. It’s about the hospitality industry and looking after people with food and drink.” 

Company News:

Admiral Taverns reports like-for-like sales and Ebitda boost: Admiral Taverns has reported a 4.3% year-on-year increase in like-for-like sales across its 713-strong pub estate in the 52 weeks ended 1 June 2019. Underlying group Ebitda increased to £23.7m during the period, a 6.2% year-on-year rise per pub. Pub Ebitda across its sites were up 4.4% from the prior year. The company said “operational and licensee-centric culture” continued to underpin growth during the year, while it strengthened senior management, operations, commercial and property teams with new appointments. Admiral Taverns also pointed to strong outperformance against its peers in the industry’s KAM Licensee Index. The company invested £8.1m in its estate during the year. Its estate is now valued at £259.8m, despite the disposal of 46 pubs during the period, reflecting capital expenditure and underlying improvement in value. Admiral also pointed to the strong performance by the portfolio of 17 pubs it acquired from Heineken-owned Star Pubs & Bars in December 2017. Two further significant transactions also completed in the new financial year, including the acquisition of 150 pubs from Star Pubs & Bars and 137 pubs from Marston’s. Chris Jowsey, Admiral Taverns chief executive, said: “We are pleased with this performance, achieved against a challenging trading backdrop for the wider industry. We are proud champions of authentic community pubs and, over the course of the year, have continued to invest significantly, not only in our estate but also in our own people and infrastructure, ensuring our pubs and the licensees who run them are best placed to meet the evolving needs of the customers they serve. I’m also pleased to see the merits of our highly supportive approach once again reflected in our strong performance in the independent KAM Licensee Index. To date we have had no referrals to the Pubs Cod Adjudicator and have been encouraged by its public acknowledgement of Admiral’s willingness to embrace the Code.”

East Coast Concepts promotes John Hammond to managing director, James Hitchen to step down: East Coast Concepts, the Manchester-based restaurant and bar group, has appointed John Hammond as managing director. The company operates two restaurant and bar brands – Neighbourhood and Victors. Neighbourhood is inspired by New York’s dining district and operates out of Liverpool and Leeds city centres. Victors offers an elegant Hamptons-inspired dining concept with three locations – in Oxford, Hale and Alderley Edge. Each site requires a circa £1.5m investment and turns over about £45,000 to £60,000 per week. The company has backing from private equity firm NorthEdge, which has invested a total of £10m. The move to promote Hammond to managing director follows James Hitchen’s decision to step down from his day-to-day activities as chief executive of the group to focus on his new venture, Hitch Hospitality. Hammond will bring a wealth of experience to the position having spent the past three years working with Hitchen on the initial expansion plan, following four years as finance director at Individual Restaurants. Hitchen said: “I am extremely excited about the next chapter in both my professional and personal life. The board agreed to allow me to focus on that next chapter some time ago on the basis a suitable succession plan was put in place. As part of that succession plan we brought on board Simon Kaye 12 months ago, with the specific task of embedding best-in-class systems, finalising the recruitment of the central team, and mentoring John for this role. Having worked closely with John for more than three years, there was never any doubt in my mind he was the right person to hand over the baton to and there can also be no doubt Simon has exceeded in all he was tasked with. Following the appointment of Tony Lewis as development chef in November 2019 and Adam Bowers as sales and marketing director in January 2020, I am confident we have left John the best possible platform to guide the group through the next part of its journey.” Hammond added: “East Coast Concepts has two extremely successful and differentiated brands, underpinned by fantastic teams and class-leading systems. I look forward to working with the executive and site management teams to continue to grow the business and capitalise on the strong foundations provided by James and Simon.” Hitchen added: “Hitch Hospitality is a hospitality and lifestyle company helping property developers, landlords, hotels and nightlife operators create, build and support their brands. The benefit of actually having created, developed and operated successful venues over the past eight years gives us a unique perspective in every project we take part in, whatever the capacity, helping brands realise their true potential and empowering their people.” Operational focus at East Coast Concepts in the past year has seen the company improve its margins, double its Net Promoter Score and halve staff turnover. Former Intertain chief operating officer Simon Kaye, who was East Coast Concepts managing director for a year to embed processes and systems, will leave the company in the coming weeks but will retain an advisory role.

Various Eateries to launch Tavolino concept at More London: Various Eateries, the Hugh Osmond-backed business, is to launch an Italian restaurant concept at its former Strada site in More London, as flagged up in Propel Premium. Tavolino will open in April and is set to be overseen by Louis Korovilas, former head chef at Bancone, who has also worked at Locanda Locatelli and Pied à Terre. Tavolino will span two floors and feature a 220-cover restaurant and bar. The concept is described as “laid back yet detailed in its service and guest experience, offering fresh Italian food across two floors, right by the river Thames”. It is thought if the project proves a success Various Eateries, which is chaired by Strada and Cote co-founder Andy Bassadone, will look to open further sites under the Tavolino name. The conversion of the Strada site leaves the brand that once had 50 venues and was valued at circa £140m with only two sites still trading, in St Katharine Docks and on the South Bank. Earlier this month Propel revealed Various Eateries, which also operates the Coppa Club brand, had appointed Yishay Malkov, one of the key driving forces behind the development and expansion of The Ivy Collection, as managing director.

Drake & Morgan to open The Semaphore near London Bridge: Drake & Morgan, the London-based bar and restaurant group backed by Bowmark Capital, plans to open The Semaphore near London Bridge as its latest site. Propel understands the group has exchanged on a deal to take the former Cooperage Bar in Tooley Street, which was previously operated by Davy’s Wine Bars. The company is understood to be waiting on a green light from Network Rail to start developing the site. Drake & Morgan, which operates venues in London, Manchester and Edinburgh, opened its most recent site, The Moniker, in Fenchurch Avenue last summer. In December the business blamed “challenging market conditions” for affecting the first half of its current financial year. The company said it expected a strong Christmas period, with bookings “well ahead” of last year.

Just Eat trials seaweed-lined takeaway boxes: Online food delivery company Just Eat has launched a trial of seaweed-lined takeaway boxes that are home compostable and degrade in four weeks. The company said the trial, which has gone live at three Just Eat restaurant partners in London – Authentic Curry Pot, Beijing House and Chilli Tuk Tuk – would prevent 3,600 plastic boxes alone from going to landfill. The company hopes to roll the box out across the UK and to other Just Eat markets to tackle the 500 million plastic boxes used by the takeaway sector every year. A first for the takeaway sector, the box has been developed with sustainable packaging company Notpla. As well as the seaweed lining, the cardboard container is made from tree and grass pulp and is water-resistant and greaseproof. Just Eat and Notpla have already trialled seaweed-based sauce sachets with restaurant partners and are working with Hellmann’s to roll them out further. Just Eat UK managing director Andrew Kenny said: “Over half a billion plastic boxes are used across the takeaway industry every year and we know eventually they end up in landfill. We’ve been working closely with Notpla to create an innovative alternative that’s recyclable and home compostable and degrades in a matter of weeks. We’re delighted to bring this new takeaway box to trial and look forward to assessing the results.” Pierre Paslier, co-chief executive of Notpla, added: “Cardboard takeaway boxes contain synthetic additives or are lined with plastic. With this box we are offering a real plastic-free, naturally biodegradable option for the takeaway market.”

Bob Bob Cité introduces maximum £75 mark-up on fine and rare wine: City of London brasserie Bob Bob Cité has introduced a maximum mark-up of £75 on fine and rare wine – regardless of value or size of bottle. Aiming to become the “ultimate destination for rare wine and fine champagne”, the venue’s list runs to 280 wines and 120 champagnes, 160 of them in large formats such as magnum and methuselah. The venue said the greatest impact of the new pricing structure would be seen in the £200-plus range. It said the mark-up was a permanent feature rather than a limited offer and applied to every wine on the list, with no limit on its value. Bob Bob Cité said the pricing model was possible thanks to “expert buying, huge capital outlay and a sophisticated business model that saw the majority of more valuable and rare wine sourced direct from the winemaker”. Bob Bob Cité owner Leonid Shutov said: “My vision for Bob Bob Cité was it would be a destination for celebrations and special occasions yet at prices that would make it accessible to everyone, not just a privileged few.” Shutov opened Bob Bob Cité on level eight of the Leadenhall building – also known as the Cheesegrater – in May 2019 as a sister site to renowned Soho restaurant Bob Bob Ricard.

Hotel Chocolat reports strong half-year as sales pass £90m mark: Hotel Chocolat has reported revenues of £91.7m for the 26 weeks to 29 December 2019, compared with £80.7m in the prior period. Pre-tax profits increased to £14.98m from £13.9m. During the half-year Hotel Chocolat opened nine UK sites with “further attractive opportunities” remaining. Two sites opened in the US, while the company’s joint-venture partner in Japan opened three. Co-founder and chief executive Angus Thirlwell told Insider Media: “Our store openings contributed three percentage points of the growth in the period, with the remaining balance coming from existing locations, digital and wholesale channels. While our new markets in the US and Japan are still in the early stages of development, consumer response to the brand is encouraging, sales are growing, and we believe we have a deliverable plan to achieve attractive returns. Our strong growth came from a wider variety of sales channels than in previous years, which led to some initial challenges in our supply chain. We are now making good progress with investments and upgrades in our supply chain, which will fully address these inefficiencies and increase our international and multi-channel supply capability, ensuring we continue to deliver profitable growth.”

Hankies to open Haymarket restaurant for third London site: Delhi street food concept Hankies, which operates a cafe in Shaftesbury Avenue, is to expand its upmarket restaurant format this month. Hankies, which is the brainchild of Anirudh Arora, opened its debut restaurant in Montcalm Hotel in Marble Arch in January 2018. Now Arora will open her latest London venue, a 250-cover restaurant in Suffolk Place, Haymarket, on Wednesday, 4 March. The venue will feature a 55-cover private dining room, while the menu will include small bites such as fruits de mer popcorn and crispy guinea fowl alongside skewers of tiger prawns from the tandoor oven. Hankies’ signature item is the roomali roti – thin flatbread that is hand-spun, cooked and folded into “hankies” to accompany or enclose dishes. The drinks list will include prosecco and cocktails, while Hankies Haymarket will also offer two and three-course pre-theatre menus. 

Harrods opens tea room at Qatari airport: Harrods has opened a tea room at Hamad International airport in Doha, Qatar. Harrods Tea Room has been designed by UK company Harrison with the service style adapted to ensure a fast table turnround as more than 10.7 million passengers travelled through the airport in the last quarter of 2019. The tea room complements the two Harrods signature stores already at the airport and features classic-style furniture, timber flooring and a peacock theme to tie in with Harrods Food Hall in London. The menu reflects English and Middle Eastern cuisine and includes afternoon tea. Harrods director Raj Assanand said: “Harrods is a London institution but has always been global in its outlook. Harrods Tea Room is the next stage in our long relationship with Qatar, a partnership that has allowed us to bring the Harrods experience to even more international customers.” In October, Harrods opened its first standalone cafe outside London – H Cafe in Henley, Oxfordshire.

Chestnut Group to reopen fire-ravaged Suffolk pub next month following two-year rebuild: East Anglian-based pub and restaurant company The Chestnut Group is to reopen The Three Blackbirds in the Suffolk village of Woodditton next month. The pub, which was devastated by fire in March 2018, will reopen on Saturday, 14 March with an expanded menu and added accommodation. The pub near Newmarket will offer 100 covers across its restaurant, bar, terrace and private dining rooms. The reopening will also see the launch of The Barn, which will offer nine bedrooms to the rear of the property including a bridal “suite”, and family and dog-friendly rooms. Chestnut Group founder Philip Turner said: “We are thrilled The Three Blackbirds will open again. It’s time this charming and much-loved pub was returned to the community. The launch of the bedrooms, landscaping and upstairs dining areas will breathe new life into the business. The rebuild has been a huge effort from local tradespeople and the team at Chestnut and has also been disruptive to our neighbours, for which we apologise. The Three Blackbirds team has been waiting two years to open the doors to customers – almost there!” The Chestnut Group operates ten pubs in the East Anglia region. 

Eastbourne-based pub operator takes on third site: Shoes Simes, who operates The Eagle and the Dew Drop Inn in Eastbourne, has acquired a third site in the East Sussex seaside resort. Simes has taken on grade II listed The Counting House in Star Road. The pub will undergo a refurbishment to reopen as The Rainbow, with Simes looking to make the business more “food-led” and “family friendly”. She told the Eastbourne Herald: “Myself and my team are committed to restoring and renovating this beautiful old building, which has historical significance as well as being important to the community. I have been looking to buy the business for 13 years and I’m interested in a long-term investment and commitment to the building. My main aim is for it to be family friendly and offer a lot of food so it’s a place for local families and friends.” Simes said refurbishment efforts would focus on the pub’s garden and modern extension, while older parts of the building would only undergo “light decorative work”.

The Alchemist to open Embassy Gardens site next month: The Alchemist, the 18-strong Simon Potts-led bar and restaurant concept, will strengthen its London portfolio by opening at the new Embassy Gardens development in Nine Elms next month. The 5,200 square foot venue, which will launch on Tuesday, 24 March, will be the company’s first London venue south of the Thames. It will offer a 94-cover restaurant for all-day dining, 66-cover bar and 24-cover terrace. Embassy Gardens will be The Alchemist’s fifth venue in the capital, with sites in Bevis Marks, Old Street, St Martin’s Lane as well as Canary Wharf, which opened at the end of 2019 and saw more than 5,000 cocktails sold in its first five days. Potts said: “Embassy Gardens was the perfect space to bring our cocktails south of the Thames. It’s exciting to be right in the hub of this highly anticipated and state-of-the-art development.” The Alchemist is set for further expansion this year and is set to take space at 41 Corn Street in Bristol. The opening will be part of a cluster approach in the south west and will follow a launch in Cardiff and a future site in Cheltenham. It will also make its debut in Scotland with an opening at the Edinburgh St James development.

London-based bar operator acquires Hastings live music venue: Kieran Canavan, who operates pubs and bars in London including Canavan’s Pool Club in Peckham, has acquired a live music venue in Hastings, East Sussex. He has bought the Jenny Lind pub in High Street from an asking price of £795,000. The venue has capacity for more than 200 customers on the ground floor and comprises a stage and bar. There is also a 60-capacity function room on the first floor and a two-tiered garden, while the pub offers six en-suite bedrooms consisting of three doubles, one twin, one single and one family room, which are accessed via their own private entrance. Canavan said he planned to increase trade and establish the pub as a well-known music venue. James Hughes, senior business agent at Christie & Co, who handled the sale, said: “The pub attracted plenty of interest, as expected, and we managed to achieve a strong price with the sale.”

Dalata reports 9.3% revenue rise as its UK hotels outperform markets: Irish hotel operator Dalata, which has a growing presence in the UK, has reported a rise in revenue and pre-tax profit. Revenue for the year ended 31 December 2019 surged 9.3% to €429.2m (£359.1m), up from €392.6m in 2018. The opening of six hotels in 2018 and 2019 and the addition of the Tamburlaine hotel in Cambridge contributed €37.4m to revenue growth. Pre-tax profit climbed to €89.7m from €87.3m, while group Ebitda jumped to €163.8m from €116.6m the previous year. Chief executive Pat McCann told Insider Media: “I am particularly happy with the performance of our UK hotels. Revpar at all our hotels in regional UK outperformed their local market and, while our London hotels were behind the city as a whole, they performed well within their own local markets. We will continue to grow our portfolio, develop our people, exceed our customers’ expectations and maximise the return from our assets. We are focused and ready for the challenges and opportunities 2020 presents.” Founded in 2007, Dalata’s portfolio consists of 30 owned hotels, 11 leased hotels and three management contracts with a total of 9,208 bedrooms. The group is currently developing 11 hotels and has plans to extend two existing sites, which would add a total of 2,871 bedrooms during the next three years. 

Pizza Pilgrims to open Camden site next month featuring convertible restaurant and training academy: Pizza Pilgrims, founded by brothers Thom and James Elliot, will launch a convertible restaurant and training academy in Parkway, Camden, on Monday, 16 March. As revealed by Propel last month, the company, which opened its 12th venue in London’s Victoria in January, has acquired the 40 Zero site from Various Eateries. During the day the site will house a 20-cover restaurant and two training rooms, transforming in the evening to a 100-cover restaurant. As well as training staff, the space will also host talks by experts from inside and outside the sector. The Elliots said they hoped the academy would champion the hospitality industry and provide people with a range of skills to pursue a long-term career. Thom Elliot told Propel: “The academy will offer training to anyone who wants to build a career in the sector, whether that’s someone who is homeless or an ex-offender as well as delivering training for Pizza Pilgrims employees. We also want to put on talks for people in the sector but outside our own business. Moving into a ‘village location’, we know we won’t need to offer a traditional restaurant space during the day, with delivery set to play a bigger part, so we can concertina the space from 20 covers in the day to 100 in the evening.” The company operates 11 sites in London and one in Oxford. Stonebrook London acted on the Camden deal.

Edyn Group expands into Cambridge: Aparthotel operator Edyn Group has acquired a site in Cambridge for its Locke brand. The venue will be part of the University of Cambridge’s Eddington development. The 180-room aparthotel will also feature a restaurant, cocktail bar, coffee shop, co-working space, meeting rooms and an events space, with an opening scheduled for summer 2021. Edyn has also entered into an agreement to operate the UK’s first Hyatt Centric Hotel, at the Eddington development. Eddington will include 3,000 homes, an arts centre, sports pitches, a park, student accommodation, and academic and research facilities. Edyn chief executive Stephen McCall told Boutique Hotelier: “We are excited to invest in this important destination.” Last week Edyn Group announced it would open a second Locke property in London, in Broken Wharf, next month. Edyn, which was previously known as Saco, also operates Locke aparthotels in Edinburgh and Manchester and has nine properties in development in cities such as Dublin, Berlin and Lisbon.

Chiquito expands vegan options on breakfast and children’s menus: The Restaurant Group-owned Tex-Mex brand Chiquito has expanded the vegan options on its breakfast and children’s menus. The breakfast menu includes vegan versions of a full English, burritos and chimichangas, while vegan options – such as banana blossom bites with Oatly and Mexican bean stew with vegan cheese – appear on the brand’s children’s menu for the first time. Chiquito managing director Angelo Gabrilatsou said: “The menus stay true to our core objectives by driving innovation, accessibility and fun, while having guest choice at the heart and understanding growing trends. For the past 18 months we’ve focused on improving the quality of our food and service while dialling up the fun we are famous for. I believe this is our biggest improvement yet.” Chiquito operates 78 sites in the UK.

New Greek restaurant concept Tavernaki launches in Notting Hill: New Greek restaurant concept Tavernaki has launched in Portobello Road in Notting Hill, west London. The venue combines the best of Greek culture, food, drink and music, with head chef Harris Mavropoulos’ menu inspired by family recipes. Dishes include marinated octopus and moussaka, alongside souvlakis from the grill. Desserts include rizogalo (Greek rice pudding with apple and cinnamon). The downstairs Mykonos Bar focuses on tsipouro (Greek grappa), ouzo and Greek wine, with live traditional music every Friday and dancing encouraged. The interiors feature sky blue chairs, a mural of the Cycladic islands and a tree as the centrepiece. 

Signature Living signs film and TV location deal: Aparthotels developer and operator Signature Living has signed a deal that offers its venues as filming locations for movies and television. The Liverpool-based company has signed an exclusive two-year agreement with Manchester-based property consultant Space-2, which is behind movies and TV series such as Mission Impossible, The Bodyguard, Luther, Silent Witness and Killing Eve. Space-2 sources, manages and facilitates filming locations for clients such as the BBC, Universal Pictures and Netflix. Signature Living’s locations will also be used for commercials and photographic shoots. Its portfolio includes six trading hotels and bar restaurant Alma de Cuba, with 12 projects in development. Signature Living chairman Lawrence Kenwright told The Business Desk: “Our portfolio includes iconic heritage properties. This partnership allows us and the cities they are based in to showcase these amazing buildings while we concurrently operate them as hotels.” In November the BBC reported Signature Living was looking to sell “several hotels” after international investors complained they were owed money.

Greene King launches Hungry Horse spring menu: Greene King has launched a spring menu for its 266-strong Hungry Horse brand that includes a lasagne-in-a-pizza sharing dish. The dish features beef lasagne sandwiched between two margherita pizzas and served with a Napolitana dip and fries. Other new dishes include a spicy chicken pizza sandwich and a fajita burger. Jason Radbourn, senior food development manager at Hungry Horse, said: “One of the greatest dilemmas when eating out is what to choose from the menu. With that in mind, we’ve combined two of our favourite dishes to create the ultimate Italian meal. We’re not shy when it comes to experimenting with food innovation and always try to create a showstopper on each new menu.”

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