Those that were wholly reliant on wet sales have been particularly hard hit, as aggressive pricing policies at the supermarkets have meant that a lot of people prefer to slump on the sofa instead of propping up the bar.
The latest figures from the Campaign Real Ale estimate that the rate of pub closures has escalated to more than a seven day, and most people will be aware that several of the large national pub chains have been selling off their property assets at a rate of knots.
The great British pub is an important part of our national character and it is sad to see that so many of them are being forced into closure, but every cloud has a silver lining!
Now that the commercial property market is beginning to show signs of life the trade in vacant pub buildings is proving to be a useful source of revenue for brokers and their clients, whilst simultaneously protecting these characterful old buildings, many of which are steeped in tradition and history, from dereliction and demolition.
We are receiving an increasing number of introductions from brokers whose clients are specifically targeting empty pub buildings with the intention of converting them into commercial units. Last month the number of pubs that we lent on had trebled in comparison to our Q1 2009 average for this type of property.
Whilst conversion to residential use is a common fate for deserted watering holes, the location and layout of many public houses also makes them eminently suitable for a wide variety of alternative commercial purposes. A good number of pubs are sizeable and conspicuous properties surrounded by densely populated residential areas.
As such, they are ideal candidates for businesses such as nurseries, pharmacies, salons and convenience stores. The fact that many pubs come with additional land in the form of gardens and car parks also makes them highly desirable for entrepreneurial investors.
Recently a broker brought us several cases from a client that has an arrangement with a well known chain of convenience stores. The broker’s client ascertains where they wish to open new outlets, then purchases deserted pubs in these areas and prepares them for the retailer to move in. We've also seen several instances where pubs have been purchased with the intent of converting them to restaurants.
None of us like to see our locals going to the wall, but the trade in vacant public houses is evidence that the market for commercial property is evolving and that there are still opportunities out there for those who have access to the right lenders.
