Long wary, UK pub chains take chance at last on Ireland
By Neil Maidment and Padraic Halpin
LONDON/DUBLIN (Reuters) - After years of waiting on the sidelines, Britain's major pub chains have finally spotted an opening in Ireland, hoping tumbling property prices will give them a chance to expand into a neighboring market they never managed to crack.
At the height of a property boom in 2007 one in six Dublin pubs that changed hands was sold for at least 14 million euros, with almost half sold for over 6 million - far too pricey for big players in need of as many as 12 sites to make a market work.
Six years on, after a burst property bubble and an international bailout, the typical Dublin pub now changes hands for a mere 800,000 euros. In that time, Irish pub revenues declined by a third and more than 1,000 mostly family-run establishments closed down.
For British chains, that means opportunity at last. According to the central bank, the average Irish pub is now carrying 270,000 euros in debt, meaning big chain entrants can exploit their financial advantage to invest in refurbishment and be more competitive on price.
The first big British pub firm to announce Irish plans is JD Wetherspoon, owner of more than 880 UK pubs. It last abandoned plans to enter Ireland almost 10 years ago because of property prices, but has now agreed to buy its first two Irish sites, both in suburban south Dublin. It aims to open 30 around the country.
"It'll probably take five to 10 years to get established," Wetherspoon chairman and founder Tim Martin told Reuters. "We think we can make a go of it."
Wetherspoon is not the only firm coming. Charlie Chawke, one of Ireland's best-known publicans, told Reuters he had been approached by an intermediary on behalf of Britain's Greene King, which has 2,300 pubs, restaurants and hotels. Greene King declined to comment on its Irish plans.
A source at another of Britain's leading pub chains told Reuters it was also keeping tabs on Ireland. Continued...