Capital is more easily available for big tenanted pub deals than it has ever been, the financier Jon Moulton told delegates at this year's Pub Strategy and Investment Conference in London.

The result, he said, will be "a lot more high-priced deals involving tenanted pubs", as well as a steady increase in tenanted pub prices.

Moulton, boss of Alchemy Partners, the venture capital house whose investments include InnSpired, said with interest rates so low, the City's big venture capital firms had dropped their rate-of-return requirements "fantastically" from 30% at the height of the technology boom of a couple of years ago to 10% or 11% now. They were also inclined to take a more optimistic view of a pub company spread sheet than they used to.

Pub securitisations are "very easy to put together and very lucrative for the organisers," Moulton said. Unless interest rates rise sharply, this was going to drive pub prices upwards. "There are not many industries where you'd be comfortable with three quarters of your cash flow being used to pay interest. The tenanted pub industry is one, and the banks and finance houses have now worked this out."

The pub trade is a big and stable industry, Moulton said, and pubs have continued to make money û "not huge amounts, but a steady accumulation of value". The present deal involving an alliance of Enterprise Inns and the venture capital company Cinven in a bid to buy Nomura's tenanted pub chains was an example of how venture capital money was cheaper, more accessible and quicker than public company money, he said.

However, he said, while tenanted pub deals are easy to finance, managed pub financing was "much more difficult" because of the varying nature of managed operations, from the cheap to the slick and trendy.

He also warned that there were too many tenanted pubs "that would make perfectly good houses û or car parks", that is, with higher alternative usage values, and there was "lots of money to be made" going through tenanted pub estates looking for pubs that should not be pubs.

Moulton also told delegates at the conference that with almost everybody now getting big discounts from the brewers, "the people who are really going to make long-term value are going to do it by wringing out the rest of the business, not the bare beer.

"That's going to require more wit than has been historically applied, and there are not many people yet doing that terribly successfully."

• A full report on the Pub Strategy and Investment Conference will appear in the next edition of the M&C Report newsletter. For subscription details contact Mark Walford on +44 (0)20 8240 4479 or email