As the demand for a ‘pub with rooms’ type accommodation offering continues to grow, we get to grips with what it is that consumers love about a traditional cosy country retreat and why they are starting to become a real contender for custom.
Since news first hit the headlines that traditional pubs were closing their doors at a rapid rate in 2009, many of Britain’s best-loved boozers up and down the country have been struggling to stay afloat. From supermarkets selling discount liquor to large pub conglomerates selling off unprofitable venues, more and more public houses have been pulling their last pints.
Despite the closure rate improving slightly – in August 2014, pubs in the UK were shutting at a rate of 31 per week – more public houses have been looking for innovative ideas to tap into new revenue streams, and adding letting rooms has proved a popular option for many of the big name brands, as well as independent operators.
As consumers seek that real home-from-home experience, a traditional country pub with boutique bedrooms is well-equipped to meet this demand and as a result, their popularity has rocketed over the past few years.
“Guests love the friendliness and individuality of the pubs and staff who work there,” explains Michael Ibbotson, director of Provenance Inns. “A good pub combines setting, architecture, atmosphere and good food and drink.
“They’re a fun, relaxed place to stay, yet now offer a high level of service and guest accommodation.
“Our inns are at the heart of our communities and certainly the fact that we embrace drinkers and diners alike, means that if you’re checking in on a Friday night, for instance, you’re not walking into a characterless, corporate space, you’re enveloped by the chatter and hub-bub of locals catching up with each other over a glass of wine and a pint or supper; this makes a huge difference. To me this is what a night away should be about.”
Areas of investment
Provenance Inns currently consists of 6 pubs located in picturesque villages in the north, and with the launch of the group’s first hotel in 2014, the demand for this type of boutique accommodation continues to grow. Michael and his director partner Chris have invested a considerable amount into transforming and continually updating their properties since the purchase of the duo’s first pub, The Durham Ox in 1999.
Michael says: “From the initial purchase and refurbishment of The Durham Ox 15 years ago and the ongoing investment Chris and I continue to make with Provenance Inns, all of our premises see considerable investment and we are able to do this as all properties are purchased freehold, permitting us to make this kind of long-term commitment. We future proof our properties. We don’t want the kitchens or back of house to have to be replaced in 10 years, so we invest heavily and that’s how we maximise income streams.
“Our country style chic décor evokes our location as well as being well thought through for our clientele’s needs (at The Carpenters Arms: think country pursuits, hence drying cupboard, gun cupboards, stone and wood flooring in entrance halls). We use a classic look which can always be updated, while not become out-moded and we work with well respected top-end suppliers for furnishings, furniture and sanitary ware.
Michael continues: “Within the pub industry we have had to diversify and obviously accommodation plays a big part of this. Private dining areas also work well in conjunction with an accommodation offering. Likewise if we can make Tap Rooms bigger we will, however at the heart of all our decisions is retaining the inherent characteristics of the original building. Hence sometimes the bedrooms are found within the original fabric of the building and at other times we build from new; both work well. We’ve been lucky enough to work with some great local architects along the way as well as building good relationships with local planners and councils. The type of properties we look for are often found in a conservation area or are listed.”
Other larger pub groups have kept a close eye on this market shift also and have been investing in their current properties as a result, transforming a selection of pubs in their portfolios into boutique havens with a handful of bedrooms.
London pub chain Youngs ploughed money into driving the hotel side of its business in 2014, investing heavily in its boutique offering and opening an additional 46 rooms in the first half of the year alone.
Some of the stand-out areas of investment for the brand included a £1.7m refurbishment of The Orange Tree pub in Richmond, transforming the pub into a rustic boutique with 13 bedrooms. As well as this, Youngs also upgraded its Wimbledon pub the Dog & Fox and The Windmill in Clapham in the early pub of 2014, proving it was well on track to achieve its ambitious target.
Therefore it came as no surprise that the company’s hotel business showed real growth when its 2014 results were posted last year. Room rates were up £0.96 and occupancy rose by 2.9 percentage points, resulting in a £2.76 increase in RevPAR to £52.02.
Fullers wasn’t far behind either. Over the years Fuller’s has built up a reputation for its pubs and beers, with the likes of London Pride, ESB and 1845 all winning numerous awards, but its vast portfolio now includes a total of 622 boutique bedrooms across its 12 hotels and 14 pubs with rooms. The company also posted strong figures on the growth of its accommodation sales – up 10.4% in 2014 – building on a previously impressive Olympic year too. Fullers also announced that a key plan for 2015 is to invest in the upgrade of its remaining bedrooms to a boutique standard, proving that the accommodation side of their operation is still a major driver of business for the traditional pub brand.
With current market conditions still tough, pub operators are realising that the more income-generating opportunities, the better, hence why investing into the building of bedrooms is high on the agenda for many. If the location is desirable and a gap in the market can be identified, then operators are grabbing the opportunities with both hands. George Arkell, brewery director at Arkell’s agrees: “In Swindon, where almost half of our pubs are based, there is an acknowledged lack of good hotel room space in Swindon, particularly on the north side of the town. If we see an obvious lack of good quality accommodation in an area, and we have a pub that might lend itself to offering accommodation, then we will look at investing.”
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Staying true to tradition
Capturing the essence of a pub is a key factor in the success of this type of accommodation; guests like to see traditional furniture, fixtures and decor to experience a real country escape vibe. Historically, old coaching inns were all about being places to eat, drink and rest your head and there has been a noticeable return to these principles as consumers continue to seek something different, shying away from the more typical hotel concept.
Michael believes that there has been a number of contributing factors as to why pubs with rooms have become so popular. He says: “The offering fitted in with the whole move towards a more relaxed approach to service, whereby you could go somewhere to enjoy, good food and good service in a relaxed and friendly atmosphere for a good price. Guests were looking for a more relaxed get-away no different from why the boutique hotel concept was grasped back in the 1990s.
“Pubs have evolved hugely over the past fifteen years since I re-opened the Durham Ox following purchase from the receivers. We were part of a small minority of food orientated inns or ‘gastropubs’, these days, it’s amazing to see the offering.
“Essentially though, in the countryside, people want to stay where they can eat, that way the whole stay becomes more enjoyable.”
The transformation of the traditional pub has been phenomenal over the past few years, no longer being seen as just another watering hole, but as real competition in terms of food and beverage offerings against some of the top Michelin-star restaurants. Especially during a time when more consumers are opting for the more relaxed, less-stuffy atmosphere of a cosy country pub. Michael explains that it’s with the help of famous chefs who have put their names against pubs as well as new innovations within the sector that all help contribute to showing off how versatile pubs can be.
He says: “With so much focus on the pub industry and innovations within this exciting fast-growing sector, customers see the endless possibilities of what is achievable and with so much media attention on big-name chefs moving to pubs, pubs are showing themselves to be very adaptable properties, competing with even the very best restaurants. It’s a sector that has certainly attracted a lot of innovators over the past few years. While some sites can require considerable investment to bring them up to date, they also have the advantage that certain areas or outbuildings can be incorporated into the space to make a much larger and viable guest area, which is certainly something that we look for at Provenance Inns.
“When I look back to the offering locally 15 years ago when I first opened, and now, it’s amazing how the declining fortunes of the pub industry have turned around.”
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For Provenance Inns, the wave of popularity that the ‘pubs with rooms’ movement is currently riding on, makes it even more crucial for the group to not get complacent. Investment is vital, as well as reassessing current practices and keeping an eye on new trends and innovations within the marketplace. Michael says Provenance Inns are looking into expanding guest areas within its pubs to help generate additional business, and consequently increasing the demand for accommodation, for example function rooms. The group is also aiming to grow, with both Michael and Chris on the lookout for new properties, all with the potential for accommodation.
“Our strapline, ‘inns in villages you’d like to live in’ accurately sums up the style and location of the pubs currently in operation,” explains Michael. “We’ve invested heavily into all our sites as we are ‘in it’ for the long haul. While not all the pubs have rooms, going forward, I don’t think we would entertain a property that didn’t offer the potential for us to do this, whether initially or in the future, as this is a key part of our business these days.
“More than 90% of the guests that stay with us dine with us and so during the quieter months and quieter days of the week, this is a key element to keeping the business rolling,” he concludes.”