Things are looking up for London’s pubs

When diverting off Berkeley Square in Mayfair and turning into Bruton Place, the cacophony that hit me was overwhelming. The sound echoing down the street emanated from a very large boisterous crowd of drinkers, enjoying a mild November’s evening outside the renowned Guinea pub that now straddles units on both sides of the road. With the exception of the taxi driver attempting to navigate his way down the narrow thoroughfare, everybody was visibly and audibly enjoying this much-needed after-work hospitality in central London. It was a similar story down the road, on the pedestrianised Avery Row, where the compact Iron Duke pub was surrounded by local workers enjoying a beer before heading home.

The Iron Duke, Avery Row

There is no doubt that not all London boozers are experiencing quite such a buoyant time as this pair. The latest figures from the Coffer CGA Business Tracker for October show a contrast in trading in London, where a shortage of office workers and tourists meant sales were down by 4% on the same month in 2019, versus the regions, where sales rose by 6%. Despite this slower pick-up in the capital, expectations are building. Last weekend was the first time the West End has been busier than before covid-19. Footfall around the key areas of Oxford Street, Regent Street and Mayfair on Saturday was 13% higher than the same day in 2019, according to the New West End Company, which also found that footfall levels after 6pm were an incredible 35% up on the same day in 2019.

The expectations that the West End might lose out on £1bn of spending are now being reassessed amid a pub sector in the capital that is building in confidence, and where an acceleration in corporate activity has been seen in recent weeks. The Guinea’s owner, Young’s, has confidently reported it is to invest around £30m over the next 12 months, compared with the normal £20m per year, as it has already signed off on various projects, and Patrick Dardis, chief executive of Young’s, expects to see other opportunities cross his desk.

I’d earlier been sceptical about the much-discussed wall of money that was supposedly heading into the pub sector as there was little evidence to support the speculation. However, this has changed, and I stand corrected as some big, experienced names in the sector have been very active in the market recently, with the support of institutional capital – and London is enjoying its share of the action.

Nick Pring and Malcolm Heap have accelerated the expansion of their Urban Pubs & Bars business, with the support of Davidson Kempner and Global Mutual, and acquired 13 premium central London pubs from Barworks, which had built an eclectic mix of craft beer-focused pubs and bars. The sale has not diminished the appetite for growth at Barworks though, as its remaining six pubs are being added to with the recent opening of the Gas Station at King’s Cross and the planned boozer for Heddon Street.

Bar with a view: The canalside Gas Station in Kings Cross from Barworks

Another long-established pub operator, Mark Crowther, chairman of Portobello Brewery, has secured the backing of Zetland Capital and formed Portobello Starboard, whose recent move suggests growing confidence in Greater London. It plans to build an 80-strong business, and the first move involves the purchase of 12 freehold pubs from various sources including Antic, that had all been backed by investment fund Downing.

The pubs represent a great mix of unique buildings located across the capital’s so-called villages and suburbs including New Cross, Streatham and Forest Gate. Zetland has stated its intention to commit further funds to Crowther and his team in order to further expand the Portobello Brewery footprint in London.

Although not yet back on the expansion trail, Shepherd Neame has been expressing more confidence in the company’s city centre pubs that include a batch in the capital. Chief executive Jonathan Neame has stated that the recovery across its estate has spread from its community-focused pubs and into the town and city centres as people are moving about more. With a continuation of these trends, Neame expects that by the middle of next year, the company will be back in the market for acquisitions and have returned to its previous strategy of investing around £20m annually.

Ahead of then there is, of course, Christmas to navigate. Despite much concern from many operators over subdued bookings for the festive period, Young’s, like some others, has seen an uptick in recent weeks and is now managing waiting lists at some pubs for Christmas Day lunch as people reacquaint themselves with their local pubs – including those in the capital.

Having missed out on my regular couple of pints on Christmas morning last year at my North London local The Great Northern Railway Tavern, I’m certainly intending to do my bit this year and will be found propping up the bar on 25 December – and a few times ahead of then too.

Glynn Davis, editor of Retail Insider 

This piece was originally published on Propel Info where Glynn Davis writes a regular Friday opinion piece. Beer Insider would like to thank Propel for allowing the reproduction of this column.