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Mon 22nd Feb 2021 - Sector fears mid-May reopening for indoor hospitality
Sector fears mid-May reopening for indoor hospitality: Leaks in the national press over what Boris Johnson’s reopening roadmap will include, have increased fears that indoor hospitality will not be allowed to open until mid-May. Johnson is expected to confirm later today plans to reopen schools on 8 March alongside after-school activities for children. According to reports this morning, people will also be allowed to meet up with one other person from outside their household for a coffee, drink or picnic without having to exercise. From 29 March they will be allowed to meet outside, including in gardens, from either two households or in groups of up to six. When it comes to pubs and restaurants, ministers are expected to take a phased approach, with those with outside spaces allowed to start serving customers as early as April, but it is likely to take longer before indoor service can return. Even then there are likely to be restrictions, such as groups being limited to two households or the rule of six. Stage three could start in May and see pubs and restaurants serve indoors or hairdressers open. It will not be until July, when most of the population is vaccinated, that hospitality will return broadly to normal. The Times reports that we may not see a return to nightclubs until the government has met its target of vaccinating the whole adult population by the end of July. Government sources cautioned that dates for each of the stages, to be announced today, will only be “earliest” dates and could slip further. Sacha Lord, night-time adviser for Greater Manchester, tweeted: “I have seen a ‘leak’ which I believe to be true – schools 8 March; beer gardens, max two households 29 March; Non-essential retail third week in April; A cautious four-point plan on releasing lockdown, based on: vaccination rollout, effectiveness, pressure on NHS and new variants.” Loungers chairman Alex Reilley tweeted: “Third week of April for non-essential retail isn’t good – implies indoor hospitality won’t be the beginning of May. Has everyone lost complete perspective of time? All of this talk about summer when we’re still in winter – the Boris Johnson ‘roadmap’ has us months away from getting back to the heavily compromised existence we had in July last year. Months. Rishi Sunak, I hope you’ve got a bumper set of support measures to unveil on the 3 March because the PM’s roadmap is going to destroy hospitality. Simply extending existing ‘support’ measures doesn’t cut it – the government has ordered us to close – the government should be paying for it.”

Soley – If we can’t open unrestricted and sooner than May, many businesses will be lost: Chris Soley, chief executive of north east-based brewer and pub operator Camerons Brewery, has said that if the pub sector can’t open unrestricted and sooner than May, many businesses will be lost. Soley warns that if pubs aren’t allowed to reopen in good time, then “Rishi Sunak you will have to dig very, very deep to get us through the next few weeks and avoid a significantly worse economic catastrophe on your hands”. Soley said: “Rumours flying that reopening for non-essential shops is another 9 weeks away and pubs looking like May. Driven by the data seems to have gone out of the window. If the scientists have their way we are heading for an (impossible) zero case target to remove all restrictions. Given the success of the vaccine across the globe, we should be accelerating back to an unrestricted open economy as soon as possible. Pubs are an essential fabric of our society and many are on the verge of being lost forever. This impacts all pubs but wet led community pubs that are vital for supporting vulnerable and lonely people as well as gluing the local community together are most at risk at being lost forever. This will be severely damaging for many communities for years to come. Pubs, brewers and pub companies are on the verge of collapse, many people’s mental health is really starting to be impacted, NHS has record breaking waiting times for other critical illnesses which are not receiving the urgent treatment they need. Covid is real and tragically killed so many but the collateral damage of lockdowns is huge, and now we see the covid numbers plummeting with the vulnerable vaccinated, the balance of damage is swinging substantially towards the lockdowns themselves. The pub (and other sectors such as arts and music) have been devastated. Rishi Sunak early intervention with furlough, grants, rates relief, lease forfeiture moratorium etc has been much welcomed but our businesses in lockdown are still haemorrhaging cash and many are running out. If we can’t open unrestricted and sooner than May, many will be lost. All the money spent so far by the government, tax payers money, will be wasted as businesses go bust. Please Boris Johnson be guided by the science and let our covid safe pubs with well trained staff reopen. We were never the problem as public health England’s own figures show. We can be part of the solution to help rebound the economy back to full strength safely. Otherwise Rishi Sunak you will have to dig very, very deep to get us through the next few weeks and avoid a significantly worse economic catastrophe on your hands. Grants for any further periods of forced or restricted closure need to be much higher and furlough 100% paid for, no pension and NI cost to cover. Once we can reopen we need long term rates relief, vat reductions, ongoing flexible furlough, a rent solution, duty reduction and we might just be able to dig ourselves out of this and repay the mountain of debt we have been forced to accumulate. I hope the rumours are wrong and your libertarian principles make you see sense, Boris Johnson.”

McClarkin – the pub is the real litmus test for our recovery in every part of the country: BBPA chief executive Emma McClarkin has said that the Prime Minister has a choice – “keep the doors open of the Great British icon that is the pub. Or be the prime minister who let the great British Pub fall”. Writing in The Telegraph, McClarkin said: “We need him to recognise that all pubs must be allowed to open together – inside and outside – when it is safe to do so and once all vulnerable groups are vaccinated. We also need him to recognise its imperative our pubs are commercially viable when they reopen. Without this, they will need more financial support and for far longer. As one of the most heavily taxed industries going into this crisis, we need the prime minister to reinvest that money into our recovery. When they reopen, pubs are going to need an extension of the Business Rates holiday and VAT cut because they are so low on cash. Now we have finished Brexit, we must also level the field on beer tax too where UK beer drinkers pay 11 times more than those in both Germany and Spain and give our great British Brewers a much-needed boost. In return for a reopening and stimulus support that enables our sector to recover, we can lead the government’s levelling up agenda and the economic recovery. Be it from regenerating high streets and creating jobs, to bringing communities back together after being apart for over a year. The pub is the real litmus test for our recovery in every part of the country. I for one, think that is an investment well made. And anything less could result in thousands of pubs being lost for good. The prime minister has a choice – keep the doors open of the Great British icon that is the pub. Or be the prime minister who let the great British Pub fall. As we hope to find a way out of the pandemic and back to some kind of normality there will be no better symbol for this than when the pub is the pub again and we can all raise a smile and cheers.”

Potential for around 170 new generation food halls to open across the UK: There is potential for more than 170 new generation food halls or “F-hubs” to open across the UK, according to new research by property advisory firm P-Three. The company said that these new community venues will be centred on food, they will also have the flexibility to respond to local demand for other uses, for example: arts, cultural, sporting or educational, where “F’” stands for both food and flexible use. P-Three said it calculates potential for around 173 F-hubs across the UK (53 Flagship and 120 Community), totalling approximately 2.9 million sq ft. Working with CACI, P-Three said it had assessed the prospects for future growth and estimated there is scope for at least 120 new community F-hubs in medium-sized towns (50k+ population) and urban quarters in larger towns and cities across the UK. It said: “Assuming an average size of around 12,500 sq ft per venue, that means there is potential floor space requirement for community F-hubs of 1.6 million sq ft. In addition, we believe many locally- run micro community F-hubs could flourish in even smaller towns.” The company also sees scope for a further 50 flagships to open in cities such as Glasgow, Birmingham and Bristol once the pandemic is over, with the community model offering something for smaller catchments, hard hit by retail closures but where more money is now being spent. Thomas Rose, co-founder at P-Three said: “Urban regeneration has traditionally been retail-led, but in a post-pandemic economic and cultural environment, with more people working from home more regularly, venues must be very specifically local to the communities they serve. These alternative uses are increasingly considered as anchors for the renewal of local areas and we believe community F-hubs will often fit the bill. Community F-hubs will not only generate value in the property that houses them, but will also have a positive effect on the values of buildings around them, as Altrincham’s well-known Market House clearly illustrates. This makes F-hubs an attractive proposition to both private and public sector landowners who appreciate the potential returns which may be generated by modest-but-effective property redevelopment projects.”

Mitchells & Butlers raises £351m: Mitchells & Butlers has raised £351m through an Open Offer. The company stated: “Since the UK government announcement on 30 December 2020, which placed approximately 78%. of the population of England in tier four (the most restrictive tier), none of the group’s sites have been open. All of the group’s German businesses were closed at the start of November 2020. In the period from 27 September 2020 to 16 January 2021, total managed sales were 69.8%. below the prior year. On a like-for-like basis (for sites when open, excluding periods of closure) trading was 30.1%. down on the prior year across this period. The group had a cash balance of £113 million as at 16 January 2021 with all facilities drawn. Agreement has been reached with the trustee of the group’s pension funds to delay monthly contributions from January to March 2021, inclusive, with these becoming due in April 2021. Taking this into account, since the start of the year, during which time the group’s estate has been fully closed, cash burn was estimated to be between £30 million and £35 million per four-week period. In addition, the group also has securitised debt servicing costs of £51 million per quarter (comprising interest and amortisation), and all non-essential capital expenditure continues to be suspended. The next quarter payment date for debt service is 15 March 2021. Following the announcement made by Mitchells & Butlers on 15 February 2021, regarding its intention to raise £350 million by way of an underwritten fully pre-emptive open offer (the ‘Open Offer’), the board has separately announced today the launch of the Open Offer. The board, which includes representatives of the Odyzean Group (a major shareholder of Mitchells & Butlers), believes that the Open Offer is critical for the continued operation and financial stability of the group, for managing the business through the current pandemic and, ultimately, to deliver long-term, sustainable growth to Mitchells & Butlers’ shareholders.” Phil Urban, chief executive of Mitchells & Butlers said: “M&B was a high performing business coming into the pandemic and with the support of our main stakeholders, including the equity injection from this Open Offer, we have every confidence that we can emerge in a strong competitive position once current restrictions are lifted. The hospitality industry has done everything that has been asked of it to date and, now that the vaccines are being rolled out and infections are dropping, we are hopeful that pubs and restaurants will soon be allowed to reopen safely so that we can start to serve our customers again”

German Doner Kebab to add 47 new sites this year and 51% rise in like-for-like sales last year: German Doner Kebab is to open 47 new restaurants by the end of 2021. The company said it plans to almost double its network of stores to nearly 100 sites, with the expansion plans set to create 1,800 jobs. It will launch sites across the UK, expanding into Manchester, Newcastle, Blackburn, Huddersfield, Stockport, Stirling, and additional sites in London and Glasgow. German Doner Kebab, which started 2021 with 52 UK restaurants, said the accelerated expansion comes after a resilient year which saw it open 12 restaurants despite pandemic restrictions. It said its latest expansion plans will be led by Rich Collie, who recently joined from Nando’s as the company’s head of project management. In 2020, like-for-like sales jumped by 51% as it was buoyed by takeaway and delivery sales during lockdown periods. Imran Sayeed, chief executive officer of the business, said: “We have been extremely agile during the pandemic and there continues to be a huge demand for our game-changing kebabs. It is therefore very exciting to be announcing these latest growth plans for the next 12 months as we build on the great momentum we delivered during 2020. Our plans will almost double our portfolio and create in the region of 1,800 jobs as we continue to disrupt the market space and maintain our mission of building the fast-casual brand of the future.” The Glasgow-based business has 76 global restaurants and is looking to open more sites in the US, Canada, Saudi Arabia and Ireland.“The global demand reflects our position as one of the world’s most exciting fast-casual brands,” Sayeed added.“We have developed strong franchise relationships in key global locations and we are now working closely with our partners to take forward development plans and bring the German Doner Kebab experience to new regions.”

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