Hall & Woodhouse’s (H&W), the Dorset-based pub operator and brewer, says one third of its tenants have signed up to its new Business Partnership Agreement (BPA) one year after its introduction.
The company expects “the majority” of tenants to transfer over the next two years and said it has seen the number of vacancies drop by a third in the last 12 months.
The BPA scraps cyclical rent reviews in favour of RPI-linked adjustments. H&W revealed that it capped RPI at 2.4% in 2010 and 2.8% in 2011, which is significantly lower than a number of larger tenanted pub operators.
H&W also revealed that it has made available lagers from Heineken UK to its tenants. In addition, the pub company has held prices for tenants on all cask ales and its HB Extra Cold brand for three years.
H&W business partnerships director Matt Kearsey said: “We are delighted with the impact that the BPA has had on our business. It is clear from the feedback received from business partners that it has enabled them to make more profit without the fear of a rent review. We are committed to supporting our business partners to ensure they succeed and initiatives such as capping RPI adjustments, holding drinks pricing and introducing more choice help achieve this.”
The issue of RPI levels on rents has come to the fore in recent weeks, with trade expert Phil Dixon challenging tenanted operators to following the lead of Fuller’s and cap RPI-indexed rent rises at 3%; others have capped it as high as 5%.
RPI reached 5.3% in March.
