A sharp recovery in drink sales has led to fewer pubs coming on the market than at any time in the last two decades. While many publicans are reporting vastly improved trade, estate agents say sales of licensed premises are about 50 per cent lower than in 1996. The two are not unrelated. Those in the business agree publicans are holding on to their premises because the drinks trade is flourishing. Audrey Buckley, of agents John P. Younge, says the market is in a Catch 22 situation.
"Pub owners won't sell because, with few premises for sale, they're afraid they won't get back into the business. At the top end of the pub market, trade is very good and owners are holding on, with the result that there's nothing for others to trade up to, something which would normally create movement on the market."
So far this year, about 21 pubs have changed hands in the greater Dublin area, with up to 80 per cent of the deals done privately. Most notable among these was Terenure House, sold by private treaty early in the year for close to £2 million. Morrisseys Auctioneers secured £1.5 million for the Penthouse in Ballymun; Botanic House, Glasnevin, was sold for about £1.6 million and Farrells, of New Street, Dublin 8, changed hands in a private deal for about £1 million.
A number of notable bars are due to go for sale in the coming months, leading Audrey Buckley to hope that "things are beginning to jig up a bit". The Gunne agency will auction Millers, on the Malahide Road, on October 15th; an early guide price of £1.2 million-plus is being quoted. Millers, according to John Ryan of Gunne, "is in turnkey condition". The current gross turnover is £14,000 per week.
Later this month, John P. Younge will auction The Ormond Hotel, overlooking the Dublin city quays. The guide price is between £2.5 million and £3 million. In October, the same agents will auction Sweeneys, in Kilbride, Co Meath - the pub used for the early RTE soap, The Riordans - for which they are guiding £400,000, and Dalys, in Stoneybatter, with a guide price of £700,000.
But, overall, sales are seriously down, especially on last year's strong market when 41 pubs were sold at a capital value of £41.33 million. This, together with the thriving economy and low interest rates, created high expectations for 1997. "The hopes for a good market after the buoyant times of '96 haven't happened," says John Ryan of Gunne.
Most publicans seem content to stay put. This is evidenced in the numbers of extensions and renovations being carried out by owners clearly intent on developing their businesses without moving on.
It is also due, in part, because licensed premises have never faced so much competition for the "leisure punt". With an ever increasing range of activities on offer to the discerning spender, many of the older bars are increasing their business by revamping and refurbishing their premises.
Bill Morrissey, of Morrissey Auctioneers, points to factors other than the roaring trade as contributing to the dearth of premises for sale. "A younger age profile has something to do with it too," he says. "A lot of senior publicans retired in the last 5-7 years and younger owners are tending to refurbish and build up the business. Then too, because business in general is good, people are tending to buy a few pubs for development. "As well as all of this, market information technology means that owners can run things more efficiently, exercise more control and then they are less likely to have to sell up."
Asked about speculation that pubs are making as much as threeand-a-half times their annual turnover, John Ryan urges caution on this score. "It would be dangerous to put a figure on it at the moment. Each pub is individual and different."
He does not believe either that the huge trade in Temple Bar, effectively the pub centre of Dublin - despite new regulations on the part of Temple Bar Properties - has affected the market. "Temple Bar caters for a need and it caters to the tourist industry. It hasn't had a negative impact on the surrounding areas. If anything, it's been good for business."
Though the boom in drink sales is countrywide, John Ryan says there is more movement in the licensed premises property market outside of Dublin. "With £500,000, you could still buy a good pub in a country market town," he says. Examples exist in sales made over the summer. The Cotton Tree, in Enniscorthy, sold for about £250,000; the Loughree Arms, Lanesboro, Longford, went for £265,000; Cullens, in Rosslare, made some £450,000 and Ennis's, in Balbriggan, sold for £600,000.
A cross section of Dublin sales this year includes that of The Bridge House, in Crumlin, sold by private treaty for about £900,000; P.J. Morans, on City Quay, sold for close to £500,000; The Barn House, in Dolphin's Barn, Dublin 8, went for £800,000 in a private deal; The Oak Tavern, in Crumlin, made £725,000 in another private deal; The Cosy Bar, in the Coombe, sold for £365,000 at auction and £350,000 was secured for The Thorn Bush, Parnell Street, in a private treaty sale.
But the underlying factor, John Ryan agrees, is supply and demand. "People will only sell when they can buy," he points out, "and there's nothing there to buy at the moment."
