The MA Top 100 Pubcos

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Welcome to The MA Top 100 Pubcos report, where we take a look at the pubs market and sort the biggest fish from the minnows in our rundown of the 100 largest pub companies in the UK.

In this guide, we rank the pubcos based on the number of sites in each one’s portfolio as well as look at the pubs market sector as a whole, including the pressures it has faced and is yet to encounter, the key trends impacting on it and where pub-owning businesses are finding the potential for growth.

Of course, most of the big players in the list have been around for many years but there are always new pubcos popping up along with more established ones increasing their numbers too.

It has not been easy for any pub company post-Covid and hospitality businesses have had to plan strategically to ensure their survival – and that has meant many cutting sites and jobs while plenty have, sadly, disappeared entirely or been acquired.

Meanwhile, the variety of differing pub models has changed too and you can read more about that throughout The MA Top 100 Pubcos report.

We have looked at the mergers and acquisitions throughout the past 12 months, the trends, innovations, the difference between wet-led and dry-led pub-owning businesses, a host of data submitted by experts in the field, changes to the pubs code and more.

Attempts have been made to contact each business in this report to verify their site numbers and they may well have changed even by the time you read this because the market never sleeps and there’s bound to be yet another massive acquisition around the corner.

Market Breakdown

The most recent CGA RSM Hospitality Business Tracker reports managed groups are seeing year-on-year sales growth of 2.9% as of June 2024.

The Morning Advertiser news editor Nikkie Thatcher states while this is down slightly from May (3.6%), it marks the eighth period of growth in the past nine months.

The growth is partially thanks to the England football team’s success in the Euros tournament, providing a “welcome lift” despite less-than-ideal weather at the beginning of summer, according to CGA by NIQ director of hospitality operators and food EMEA Karl Chessell.

He says: “June’s solid if unspectacular growth capped a decent first half of the year for Britain’s hospitality groups.

“The weather has been far from ideal for pubs and drinks suppliers but England’s progress in the Euros has been a very welcome lift for venues screening games."

He adds while this, combined with a good month for restaurants shows consumers remain eager to eat out and gives cause for optimism people would loosen their spending as some cost pressures eased, Chessell warns groups will have to work hard to achieve meaningful growth in the second half of the year.

Looking back to last year, growth levels were higher as sales in managed pub, bar and restaurant groups saw 6.7% year-on-year growth in June 2023, which was the ninth successive week.

This was partly attributed to the hot weather last June, bringing customers out to drink with pub sales up 10.8% against the same month in 2022.

Last year, Chessell said the figures highlighted the “impressive resilience” of managed groups, despite rising costs for both consumers and businesses.

He added: “People remain eager to visit pubs, bars and restaurants when they can, especially during warm weather and pub operators and suppliers will hope for more high temperatures as the summer holiday season begins.”

Furthermore, at that time, interest rates were increasing and Chessell cautioned rises could dampen confidence while lingering cost pressures remained before optimistically forecasting a good long-term outlook.

Innovation

The pub ownership model is one that remained rather traditional and unchanged for centuries until legislative changes in the late ’90s forced seismic change through the sector, breaking up the brewery link and introducing the concept of the pub company.

While that description is probably far too simplistic, it’s fair to say despite the changes the Beer Orders wrought on the sector, the central model of pub ownership remained unchanged, with the majority remaining tied under a leased of tenanted model.

However, with further Government interference in the 2010s, with the introduction of the pubs code, those models began to evolve, and we’ve seen the pace of change accelerate and innovation grow within the sector - not just in the agreements themselves, but the services now provided as pubcos recognise the need for a greater degree of co-operation and partnership with operators.

Marston’s was early to the party, introducing retail agreements ahead of most of the pack, agreements that have proliferated throughout the sector under a wide number of different titles.

The company has now evolved its offer further and is predominantly offering a turnover share agreement to new tenants, one that is proving popular, says Ed Hancock, operations director - wet-led pubs and property. “The recent PCA survey shows that turnover share works,” he adds, highlighting the fact the company was rated top. “It’s what people are looking for and on average we get six applicants for every turnover share versus 1.7 for every T&L (tenanted & leased) site.

“It’s a simple innovation - we’re matching remuneration to the complexity of the pub operation, giving more share where it’s needed - but it pays dividends. We’re making more money even when we’re sharing more with our partners.”

Training is another area it is looking to innovate - linking training with cap ex opportunities. “Our invest-for-success system uses capex as a lever to upskill operators but also ensures operators are best equipped to deal with the increases following investment. Making sure the operator is ready to maximise the opportunity available.”

And Marston’s is not the only one innovating its offer to attract a new generation of operators. Following the successful launch of its Hive Pub concept - the first to offer franchisees a guaranteed income - Greene King has now rolled out Nest, an evolution of Hive aimed at offering a more wet-led community model. Although the Nest pubs are mainly drinks focused, the company is looking at innovative food offers to allow pubs with limited to no kitchen space the opportunity to maximise sales. On top of a pizza offer, Greene King has recently partnered with Pieminister to offer “handy pies” to customers in Nest pubs.

Within its own managed partnership model, Punch is also innovating when it comes to growing its own operators. The 2024 Publican Awards-winning business for partnership is offering the opportunity to existing managed partners to nominate high performing team members to be trained up to take on their own site. It’s also using psychometric testing to ensure operators are matched with the best possible operation to give them every chance of success.

With volatility in the energy market, Punch has also established its own energy supply deal, PubSpark, offering competitive and flexible energy deals to its operators.

Wet v Dry

The pub industry is always evolving as consumer habits continue to shift post-pandemic and amid the cost-of-living crisis, but are wet or food led pubs faring best in the current market?

Admiral Taverns CEO Chris Jowsey says the pandemic provided a “renewed shift in appreciation for local pubs”.

"Consumer habits are changing all the time, so licensees are used to having to constantly grow and adapt their offering to suit the needs of their customers."

Though Jowsey details community wet-led pubs had to “evolve quickly” in 2020 to stay afloat, meaning the industry landscape has “changed significantly” post-Covid.

He says: “[These pubs] showed themselves to be extremely resilient and it's fantastic to see this renewed agility has remained.

“Consumer habits are changing all the time, so licensees are used to having to constantly grow and adapt their offering to suit the needs of their customers.”

However, Jowsey specifies how the industry has also faced “significant macro-economic challenges” in recent years in terms of rising rates and utility as well as the cost-of-living and staff shortages.

The CEO also explains while rising food costs have hit all pubs, wet-led venues are more “shielded” from this.

However, the impact of having to diversify their business into “multi-purposed” venues post-pandemic has impacted wet-led site more, he adds, especially as customers tighten their purse strings amid the cost-of-living crisis.

“Wet-led pubs, by their design, are shielded from some of the rising food costs, and they have significantly lower utility costs without the energy needs to serve food.

“Despite this, many have still seen the need to evolve their offerings to enable them to become multi-purposed, versatile community spaces as opposed to just places to drink.

“For example, one of our sites – the Plough in Appleton – now offers itself as a work from home space to local residents every Wednesday, while the Poole Dole in Stoke-On-Trent runs weekly coffee mornings for the elderly as well as mother and baby groups to combat loneliness within the community.”

Another observation Jowsey makes is how consumers are saving the pennies by holding back on eating out, opting instead to visit community wet-led pubs and then returning to eat at home, which is seen as a “more affordable treat”.

Jowsey also makes note of a shifting consumer desire to socialise with family and friends nearer to home in an effort to save on spend, bolstering trade for local pubs which may be seen as more reasonable than venues further afield.

“We’re seeing an increase in consumer confidence and spending this year, particularly across our estate.

“But the sector still faces extremely high tax burdens, including unfair business rates, beer duty and employee national insurance payments, which makes it increasingly difficult for pubs to keep their doors open.

“The new Government has a real opportunity to enhance this wonderful sector - which employs almost a million people across the UK and contributes £26.2bn to the economy annually - and give community pubs the support they need to thrive."

Meanwhile, Fuller, Smith & Turner (Fuller’s) marketing director Sam Bourke says while food-led pubs have also faced diversification issues amid rising costs, the segment is “vibrant”.

Bourke says: “Food-led pubs have continuously evolved over the years, moving from the early days of simple sandwich offerings behind the counter to the rise of the gastropub, to their current role of providing a food experience tailored to each pub’s audience.

“Post-pandemic, customers sought ways to reconnect, and food-led pubs became ideal venues for these joyful reunions.

“We quickly learned our customers craved premium experiences and sought food and drink options they couldn't easily recreate at home.”

Bourke explains Fuller’s food sales are outpacing drink sales, with more customers visiting its pubs to eat and drink compared to a year ago.

Though the marketing director adds while food inflation, which was most recently measured at 3.6% according to data from CGA by NIQ, has had an impact, the challenges around wages and business rates are “more significant”.

Bourke warns while food-led pubs are experiencing a “fascinating and innovative” time, volatilities around costs in the current market mean it is “crucial” for food-led pubs to understand their customer base to curate successful menus.

“Whether you are a destination pub with a strong focus on food or a versatile site offering brunch, sharers, traditional pub classics, and kids' menus, the market is vibrant.

“We have adopted a customer-first approach, identifying our different customer groups and their behaviours in our food-led pubs. We then create menus that cater to their preferences, which has been very successful for us.

“As we are in a lifestyle, customer-focused industry, we must prioritise delivering what our customers want, and do so brilliantly.

“Delivering great food involves a comprehensive process—from customer insight to buying, food development, menu creation and excellent service. Ensuring all steps work collaboratively is vital for maintaining a consistent and appealing offer.”

What is driving the pub market?

Exclusive insight from The Morning Advertiser has found profitability at pubs is largely down while turnover is a mixed bag across the board from some doing remarkably well while others have been hit substantially.

Here, The MA associate features editor Gary Lloyd checks out what you – the licensees and pubcos – have said is happening from the coalface.

A survey of pub operators has shown turnover is mainly ‘up a bit’ for 30% of respondents and ‘down a bit’ for 22% while ‘up substantially’ clocked 14% of the poll with 16% confessing their revenue is ‘down substantially’ with the remainder (18%) saying it was flat.

However, profitability is a different story with just 25% admitting they made money – 8% saying it is up substantially and 16% saying profit is up a bit.

Some 34% say profits are down substantially, 21% state they are down a bit with the same figure saying they were flat.

The two biggest cost increases respondents cited over the past year were wages and utilities, clocking up 37% and 38% of votes respectively.

Although rent and business rates were seen as negligible in terms of numbers saying these had been the most significant increases, drinks prices (15%) and food costs (9%) accounted for the rest of the biggest cost hikes.

For licensees whose turnover had declined, almost six in 10 (59%) claimed the economic climate had been to blame while the next biggest impact was the beer tie from their pubcos (15%), with supermarket pricing (9%), beer duty hikes (8%), better home entertainment (5%) and competition from rival pubs (3%) lagging behind.

However, those who said trade had increased said an investment at the pub (38%) or an improved food offer (33%) had made the difference.

Some 17% said the weather was key to an uplift in business last year while screening sports (7%) and a beer/cider festival (5%) were other reasons.

Facebook, word of mouth and the pub’s website were suggested as the three most popular marketing channels for licensees while Instagram stood out as the fourth choice.

With food being a driver of sales, the majority (45%) of respondents serve lunch and evening meals and 21% serve all day through – breakfast or lunch only clocked up a total of just 5%. Meanwhile, almost three in 10 (29%) don’t serve food at all.

Understandably, a quarter (26%) said no turnover is accounted for with food sales while 53% said it made 50% of turnover or less while 23% enjoyed turnover of 51% or above comprising of food sales alone.

Beer, on the hand, is a different story. Almost four in 10 (38%) said beer accounts for 61% or more of its total turnover with 38% stating beer makes up 40% and below of their turnover.

As the burgeoning low & no sector gains traction, the percentage of soft drink sales is certainly a market worth exploiting for licensees. Some 44% say softs make up between 6% and 10% of turnover with 5% of respondents stating 21% and above of turnover is accounted for by soft sales.

Although the majority of licensees (34%) say they pay bar staff the adult minimum wage of £11.44 per hour, many are being more generous, arguably in a bid to retain employees as employment remains a difficult task.

More than 30% pay between the national minimum wage (NMW) and £11.99 per hour, 24% pay up to £12.99 with 1% claim to pay between £15 and £16 per hour.

Accommodation is another area where pubs can make ground despite only 21% of survey respondents stating they have rooms to let.

Of those who do, half have between one and five rooms available with 29% offering six to 10 rooms. As the number of rooms decreases form there, there’s a surprising uplift at 21+ rooms, which accounts for 11% of licensees.

On the future, turnover is expected to rise ‘a bit’ for 44% of operators with 32% expecting it to remain flat. Predictions of turnover being ‘down a bit’ (12%) and ‘down substantially’ (7%) outweigh the optimists who believe it will rise substantially, which sits at 5%.

Many believe investments at their site(s) will reap rewards with 52% planning to do so in the next year and 27% considering doing so. Just 21% give a definitive no to investing.

The monetary value of such investments vary across the board with £5,000 to £10,000 (28%) and £20,000 to £50,000 (22%) being the most popular. However, a strong contingent of 13% claim they will plough between £50,000 and £100,000 into their pub.

In the past year, ‘general fabric’ has accounted for 57% of pubco’s/licensee’s spending with kitchen (20%), interior restructuring (14%), toilets (8%) and conservatory (1%) making up the rest of spending.

With the economic climate still hitting the sector, 55% are not considering taking on another site while 22% will and 23% sit on the fence.

Pubs code update

Protecting pub tenants and ensuring a smooth relationship between them and their pub company is essential to entire operating system of pubs in the UK. Here, Fiona Dickie, who is the pubs code adjudicator, explains the role of the office and how pub companies must adhere to it.

Can you give an overview of what the pubs code adjudicator does?

The pubs code is law that protects the rights of tied pub tenants of the six largest pub companies in England and Wales – Admiral, Greene King, Marston’s, Punch, Star Pubs and Stonegate – all pub companies that own 500 or more tied pubs.

The pubs code was created to ensure fairness for tied pub tenants in their relationship with their pub company. It exists to give tenants the best chance of success, giving them rights, including transparent information before they decide to take on a pub, fairness in rent assessments and, in specific situations, the option to switch to a free-of-tie agreement.

The pubs code adjudicator (PCA) is responsible for enforcing compliance with the code and promoting awareness of tenants’ rights, as well as providing an arbitration service for disputes between tenants and pub companies over code compliance. The PCA has the power to investigate suspected breaches of the code.

What are the latest updates to the pubs code that would affect the big six?

We’ve just released the results of our Annual Tied Tenant Survey, where we interviewed more than 1,200 tenants. This big annual piece of research highlights how satisfied tenants are with their pub company, giving the ‘big six’ valuable feedback on how they are dealing with their tenants.

The results are interesting and well worth a read for any tenant who has a tied agreement, or is thinking about taking a tied agreement, with one of these companies – you can find the results on the PCA website.

Overall, we found 63% of tenants are satisfied with their relationship, with Marston’s, Admiral and Greene King achieving the highest overall scores.

We were pleased to see in this year’s survey that awareness of their code compliance officer (CCO) with tenants has increased – there is now a job for CCOs to help tenants understand more about what they do.

Is there a difference in how the PCA office works now compared to when it was first introduced?

In the eight years since the pubs code came into force, we have certainly evolved. Ensuring code compliance is always central to our mission, and we now have clear arrangements for pub companies to self-report to us when they breach the code, and show us how they have then put matters right for tenants.

Arbitration disputes, which were the focus of PCA activity in the early years of the code, are now low in numbers and this is a big step in the right direction.

While there is still more to do, we have increased our efforts in communication and transparency, publishing detailed performance indicators, arbitration data, and our annual report, as well as, of course, our Annual Tied Tenants Survey. We have also placed greater importance on helping tenants understand their rights as part of our purpose.

After joining as deputy pubs code adjudicator in 2017, I was pleased to move into the PCA role four years ago. Recently, I have been reappointed for a further three-year term, which allows for an uninterrupted continuation of long-term strategies to enhance the effectiveness of the pubs code.

How are the pubcos treating their tenants, and is their behaviour becoming more transparent and fair?

Our Annual Tied Tenants Survey results show good levels of satisfaction are achievable. They show 77% of the tenants surveyed felt their business development manager (BDM) was fair with them in discussions.

We saw some positive feedback on transparency and the pub companies are performing well with the provision of accurate information when taking on a tenancy. But there is still scope for improvement, and clear, consistent communication between the pub company and its tenant is critical to achieve this.

The overall satisfaction results look a little different when we split out the pub companies, with Marston’s, Admiral and Greene King performing significantly better than Star Pubs, Punch and Stonegate. In particular, Stonegate’s results show it has work to do to increase tenant satisfaction and we will be working closely with Stonegate to understand how it can improve its relationship with its tenants.

How do you see the relationship between the pubs code adjudicator and pubcos progressing in the future?

The PCA is the independent regulator and an important part of our role is to engage with all six pub companies about their code compliance. This is particularly the case with code compliance officers in pub companies because their job is to ensure compliance with the code.

I am pleased our survey shows a significant increase in the number of tied tenants who trust the PCA to regulate independently of the pub companies. Now, as the pub companies take the time to digest this year’s survey results, we’ll be looking at where each of them needs to focus its efforts to drive meaningful improvement for tied tenants.

We know they take these survey results very seriously. Understanding the industry as a whole is valuable, but each company is different, and understanding how each can deliver the best for their tenants supports our effectiveness as their regulator.

Our day-to-day work regulating the industry and, where needed, arbitrating disputes continues, and we will remain vigilant to ensure tenants are empowered to get the best deal for their business, and our industry has every opportunity to thrive.

"The pubs code was created to ensure fairness for tied pub tenants in their relationship with their pub company"

"Our survey shows a significant increase in the number of tied tenants who trust the PCA to regulate independently of the pub companies"

Operator models

The Morning Advertiser looks at the operating models of the big six pub companies, with a focus on how they function and what they provide.

STAR PUBS

Star Pubs, formerly known as Star Pubs & Bars, the pub arm of Heineken UK, has more than 2,400 pubs in its estate and has various agreements.

Managed operator model – Just Add Talent

Star Pubs has a partnership offer with Just Add Talent (JAT), a model that contracts with operators in order to provide varying management services to run Star’s pub efficiently in return for a weekly fixed revenue percentage and an uncapped quarterly 20% profit share. The in-going cost is £4,000 – £3,000 of which is a refundable deposit.

Operators are self-employed and responsible for funding personal salaries and staff salaries. Other costs such as council tax and TV licences are also funded from weekly revenue shares. Star Pubs is responsible for paying all operating costs such as utilities, food and drinks, stock repairs and also business rates. Star offers ongoing support to operators and also sets the pub’s consumer offer.

Star Pubs currently runs 190 JAT pubs and it is a model which includes three versions tailored to each site. These include community, premium local and high street.

The retail offer includes centrally-driven initiatives all pubs take part in, such as the Euros, cider days, Six Nations, and Spirit of the Games. However, operators also arrange local activities within a budget such as quizzes, entertainment and sports teams. Pubs also have the option to opt in to an additional range of fully costed and professionally produced promotions.

The model also offers back-of-house support and systems such as EPoS, health and safety, stocktaking, training and allergen info.

Leased and tenanted

Each lease is different and requires individual support and investment, according to Star.

A guide on its website suggests a smaller pub or a first-time operator would invest £10,000, a medium pub ideal for a partnership or experienced operator would invest £30,000 while a large pub that needs an experienced licensee or a multiple operator would invest upwards of £50,000.

Star’s foundation tenancy for England and Wales provides the freedom for licensees to set the pub’s offer, with the option to break the agreement at any time with three months’ notice.

Contracted out of the Landlord and Tenant Act 1954, the agreement will come to an end after five years.

Key features include a five-year fixed term and fixed rent for the full term.

It also means Star can terminate the agreement on three months’ notice if there are significant rent arrears or tie breaches.

There are reduced repair and maintenance obligations compared to the fully repairing and insuring (FRI) lease.

The investment tenancy agreement is used for pubs Star will significantly invest in and where a qualifying waiver is entered into, in line with the pubs code.

Similarly to the foundation tenancy, the licensee sets the pub’s offer. This agreement is also covered by the Landlord and Tenant Act 1954 meaning the licensee has the renewal rights at the end of the five-year rolling term.

Other key features are fixed rent for each five-year term and five yearly rent reviews.

Furthermore, this agreement can only be ended once every five years on the anniversary of its start date. According to Star, if no notice is served by the tenant or landlord, it will ‘roll’ for a further five-year period.

In addition, and again similarly to the foundation agreement, the investment tenancy has reduced repair and maintenance obligation compared to FRI.

The FRI lease Star describes as “perfect for experienced licensees who want time to build up the value of their business and accrue the return on their investment”. These licensees are also able to re-assign their lease should they want to.

This agreement is fully protection by the Landlord and Tenant Act 1954.

Key features here are a minimum 10-year agreement, which is re-assignable.

There is a rent review every five years, no retail prices index (RPI) increases, and the licensee is responsible for all repairs and maintenance.

GREENE KING

Greene King offers three operator models across its portfolio of more than 1,600 pubs. It’s leased, tenanted and franchise business unit is Greene King Pub Partners.

Franchise

Greene King provides two franchise pub business models – Nest Pubs & Hive Pubs, which are both wet-led, with Hive launched in 2021, and Nest more recently in 2024.

The franchisee focuses on delivering the proven business model and concept in return for a share of the profits and turnover of the pub.

The franchisee is self-employed and also employs all staff at the pub while Greene King supplies all food, drink, marketing and support to operators.

Franchisees with Greene King have full Sky and TNT sports packages. Operators opting for franchise models pay no rent, and completely implement Greene King’s proven business model.

Stock, cash, property repairs as well as fixtures and fittings are also covered by Greene King as well as a fully supplied food menu. Start-up costs are between £3,000 and £5,000 including covering agreement fees, induction and on-site training.

This agreement is based on an initial five-year term.

At Hive, the franchised agreement of Greene King, Sky and BT Sports packages are covered, with different requirements for operators including a required £5,000 entry into the business, but operators are guaranteed a £20,000 a year income. Employee costs are also expected to be covered including any staff wages, as well as national insurance and statutory deductions. Insurance should also be covered.

Correspondingly council tax for the private accommodation should also be paid. Greene King also provides a pre-agreed food menu and supply all food and drink. Moreover, it offers repairs for any property damages.

For Nest, entry is £3,000 entry, which includes all agreement fees and required training and operators receive a 20% share of net turnover paid weekly.

Greene King also provides an annual bonus scheme of up to £5,000. With Nest pubs, Greene King provides a ready to run pub. Employee costs, insurance and council tax are included as ongoing costs for operators.

Both Hive and Nest are aimed at those with pub management experience and offer a variety of sports and entertainment options.

Nest pub franchisees only require a smaller team to oversee business, also offering smaller food options than Hive pubs.

Leased and tenanted

The tenanted and leased models vary from agreement to agreement; however, Greene King tenancies tend to be three-to-five-year non-assignable agreements with assignable leases spanning from 10 to 20 year agreements. Leaseholders normally have full repairing responsibilities, whereas Greene King look after most of the repairs with tenancies.

Being a registered tenant with Greene King means operators retain their own agreed business plan with Greene King support. Greene King also takes care of certain repairs.

Tied tenants with Greene King are required to buy drinks from the brand, depending on agreement, but tenants can procure their own food. Tenants also cover all bills.

For tenancy, the entry costs see an initial investment of £20,000 at a minimum including the purchase of fixtures and fittings and tenant deposit.

Punch Pubs

Punch Pubs offers management partnerships as well as different forms of tenancy and lease options across its 1,300 strong estate.

Managed

Punch’s management partnerships are on a five-year term, with a £3,000 deposit.

Punch also provides living accommodation, training and access to Punch Buying Club within the agreement.

Bills and maintenance are included, as well as EPoS and food menus and it offers expert coaching and advice. The experience level required for managed partnerships is set at ‘manager of hospitality business’.

Leased and tenanted

Punch has two tenancy agreements – turnover and flexible. These agreements have some similarities including a flexible term length of up to five years. Deposits are from £1,000 and the experience level required is ‘some business experience’.

Throughout both agreements, both living accommodation and training is included, with access to the Punch Buying Club also a feature.

However, bills and maintenance are not included within either agreement.

EPoS is provided throughout the turnover tenancy, however not within the flexible tenancy. Food menus are not offered in either agreement, however coaching and advice is.

Similarly, it also has turnover and flexible agreements for leases. Both require a level of ‘experienced operator’ with term lengths for both of 10 years.

In addition, deposits required for both options are either £6,000 or three-months’ rent.

Living accommodation is provided as well as training and access to the Punch Buying Club.

Like the tenancy agreement, bills and maintenance are not included while EPoS is also provided within the turnover lease option alongside coaching advice.

However, food menus are not available with either lease option.

Admiral Taverns

Community-focused operator Admiral Taverns runs around 1,400 sites UK-wide.

Predominantly operated under a leased and tenanted model while about 14% of the estate runs under its community wet-led operator division Proper Pubs.

Leased and Tenanted

Its tenanted and leased model works via a lease or tenancy agreement where the licensee has complete responsibility for the day-to-day handling of the business.

Most tenancies/leases include a negotiated supply agreement covering the purchase of all drinks categories and possibly other goods and services.

The level of rent will depend on the licensee’s purchasing ogligations under the tie with flexibility around free-of-tie options, all of which is discussed and agreed between the BDM and licensee when the pub is taken on.

Admiral has two core agreements – the Admiral Tenancy and the Admiral Lease.

The Tenancy is for new licensees and usually is a fixed five-year agreement.

It may not be assigned and is outside the Landlord and Tenant Act 1954, meaning there is no automatic right to renewal.

Rent can be increased or decreased on an annual basis and measured using RPI.

In addition, there is no open market rent review within the Admiral tenancy agreements.

The licensee is not responsible for structural defects within this tenancy agreement but is responsible for internal repair and decoration.

It is also available with a break option for both parties (usually three or six months).

The Admiral Lease (fully repairing and insuring) is designed to encourage greater lessee investment through offering more security and flexibility.

It means lessees can develop the business over a longer period, creating capital value and set the term to suit their business plans in blocks of five years from 10 to 30 years.

Rents can rise or fall annually on the anniversary date in line with inflation, again measured by RPI.

Furthermore, rents are also separately reviewed every fifth year of the term to an open market rental.

Under the terms of the standard Admiral Lease, the licensee is required to put and keep the whole of the property in good repair and condition.

Admiral also has its Proper Pubs service agreement.

It is designed to provide an alternative retail model to the traditional tenanted and leased model.

It allows operators to be self-employed, offering investment into properties, marketing team assistance and providing products to sell. Help within this agreement is also available with maintenance issues.

Operators receive a percentage of the weekly net turnover to pay the team and themselves while Admiral takes care of the rest of the financial obligations.

Stonegate Group

With an estate of more than 4,000 pubs consisting of around 2,769 leased and tenanted and joint ventures, 1,325 managed (including Craft Union) and 319 commercial sites, Stonegate Group offers a myriad of agreements.

Managed Estate

Stonegate’s managed estate incorporates high street bars, inns and late-night venues.

Its operator-led managed estate, Craft Union, supports operators in the everyday running of their pubs. Conditions include accommodation for the pub owner and family for as long as the managed service agreement is in force.

Payment of all tax service and utilities are covered as well as maintaining stock levels and the maintenance of the pub. Entertainment, TV sports packages and door security are also provided with taxes, rates and rent also covered. Stonegate also insures the building and offers operators marketing support.

There are no start-up costs but a £2,000 bond while operator earnings are at 20% of net revenue with the opportunity to take home an additional 10% of sales above budget when managing a high-volume pub.

Leased and Tenanted

Stonegate’s Fixed Term Tenancy agreement offers a five-year fixed term, with tie release options offered across wines, spirits, minerals and flavoured alcoholic drinks.

This is in return for a tie fee release. The five-year fixed term is also without a landlord break option.

Licensees are entitled to operate machines, if they want to and can retain all of the income.

Stonegate covers all structural repairs with the licensee responsible for the rest.

This agreement has low ingoing costs with deposit requirements from £2,000.

Stonegate also offers a Partnership Incentive Lease, which is a fixed 10-year lease agreement.

Fully assignable after two years, this agreement includes the operator having the choice between an open market or annual indexation review for the five-year rent.

Stonegate is responsible for all repairs to the exterior, structure and services with the licensee responsible for all other repairs alongside day-to-day maintenance.

Furthermore, Stonegate also offers a Partnership Incentive Lease. This is a fixed 10-year lease agreement that offers the opportunity to earn an end of year incentive and is also assignable after two years.

It offers the chance to utilise tie release fees from a fully tied basis as well as a drinks tie.

The agreement also includes the choice between an open market or annual indexation review for year five rent.

A cash deposit of three months’ rent is required upon commencement of the lease and Stonegate maintains all structural repairs to the property.

Stonegate’s commercial properties represent the portfolio of its estate available on free-of-tie agreements, which it suggests are most suitable for entrepreneurial and experienced operators who have little restriction on how they run their business.

Under this agreement, operators are free of all trading ties for both products and suppliers with flexible term options.

Three months’ rent is required by the tenant. Stonegate also provides two years loss of rent and recharges. The initial lease Stonegate provide will either be between five, 10 or 20 years.

Each party is also required to pay their own legal or other fees. Operators have the opportunity to run their site as they deem appropriate and also have access to the Stonegate Group’s free-of-tie deals.

The pub company’s Retail Partnership Tenancy includes a term of up to five years and a drinks tie with the opportunity to utilise tie release fees from a fully tied basis.

Stonegate also responds to all structural repairs.

This agreement requires a deposit of up to three months’ rent upon commencement and training modules are also provided. Weekly billing is also available with flexible credit terms.

Marston’s

Marston’s runs a blended estate with a growing focus on partnership turnover share agreements, divided between pubs that are wet-led and food focused.

Just under 200 sit in its tenanted and leased area while nearly 900 are part of various new partnership agreement models.

The company is keen to stress agreements are flexible and individual with all pubs and operators treated on a pub-by-pub basis.

Agreement requirements

Certain requirements within the partnership agreement model include: a security deposit starting from £5,000. Legal costs are also required to be covered with £360 including VAT with operators own insurance.

An agreement with Marston’s is a five-year commitment, with a three or six month notice option. A sustainable business plan is also required in accordance with the pubs code as well as proof of independent and financial advice before proceedings can commence.