While we have pointed out in early 2011 that fewer London and UK pubs were closing than a year or so earlier, interesting figures show a huge gap between ‘free house’ pubs, and tenanted or leased pubs. A ‘free house’ or pub is not “tied” to a brewery, they are free to stock whatever beers and ales they like. Whereas the tenanted and/or leased must sell the beer/ale their landlord (a brewery) makes.
The British Beer & Pub Association (BBPA) recently said twice as many ‘free house’ pubs close as tenanted or leased UK pubs:
“…3,444 free trade pubs closed, compared with 2,239 tenanted and leased pubs over the same period. As the free trade sector has considerably fewer pubs, their closure rate over the period was almost double that of the tenanted and leased sector, at 16 per cent, as compared with 8 per cent. Taking new openings into account, there was a 9 per cent net reduction in free houses, compared with a 6 per cent reduction in tenanted and leased.”
Despite the considerable numbers of pubs being sold into the free trade from the tenanted sector, ‘free house’ or ‘free trade’ pub closures are higher. There’s now more ‘free trade’ pubs than at the start of 2009 because companies have sold tenanted/leased pubs to private owners. Some of the best pubs in London are a mix of ‘free houses’ and tenanted / leased pubs.
Why do London and UK pubs close?
The closure of a UK or London pub is caused by a large range of issues – one is the rates of taxation and the high cost of regulation, which the BBPA argue are both still too high / costly. The cost of rent of tenanted / leased pubs has actually decreased over the years the BBPA argues, though we’d like a more transparent look at that figure with whether the prices the breweries charge their tenants for beer has not increased at the same time!
The BBPA Chief Executive Brigid Simmonds says:
“The pub market is very complex, with transfers of ownership and openings and closures happening all the time. However, the bottom line, as the data clearly shows, is that more free-trade pubs have closed than tenanted and leased.
Tenanted and leased pubs benefit from considerable support from pub companies, with some £265 million invested in rent concessions, marketing, trade discounts, capital investment and training for their tenants in 2010 alone. In addition, rents have reduced in real terms by 20 per cent since 2008.”
Here in The London Pub Crawl Co. office we had a bit of a debate about whether a ‘free trade’ or tenanted / leased pub was better. In the end, after much analysis of the 160 wonderful London pubs we have profiled in our app, we decided it didn’t really matter. As long as you find your way into one of the gems we have identified, we think you’d find it very hard to tell the difference!
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