Travelodge targets £100 million expansion programme with the UK’s pub companies
18th Apr 2011
Travelodge, the UK’s fastest growing hotel company, is targeting a £100 million, 36 site expansion programme in partnership with the UK’s resurgent pub companies by 2015.
Already co-located with pub companies on 15 bespoke developments across the UK, Travelodge is now actively working with Greene King, JW Lees, Marston’s, Mitchells & Butlers (M&B) and JD Wetherspoons to find further development opportunities across the country.
In recognition of the recent upsurge in activity from the pub sector, Travelodge has for the first time devised a bespoke development strategy to partner up with a wide range of pub companies. By working together the hotel brand can capitalise upon the opportunities that the renewed development activity of the pub companies provides.
The expansion plans of the pub companies come on the back of consumers continuing to eat out despite the economic conditions. For instance, Ralph Findley, Chief Executive of Marston’s announced that ‘70% of income is people coming into dine’ when giving their recent results. Also, Greene King’s Chief Executive, Rooney Anand, said recently that ‘Food is a particular driver of growth. Food sales are now 39 per cent of total revenue…that figure will continue to grow.
Following the success of their food operations, listed below are some of the significant recent expansion announcements from the UK’s pub companies:
• Greene King seeking to add 200 pubs to their estate by 2015 in order to
reach 1,100 outlets. Pub brands include Hungry Horse and Belthaven, specialising in Scotland.
• Marston’s saying that they will add to their 500 sites by opening 20 new pubs in 2011 and 25 in 2012. Their brands include Pitcher and Piano and their own Marston’s Inns.
• JD Wetherspoon committing to opening 50 new sites a year for the next decade.
• M&B stating that they will open 50 sites this year and 70 hotels in 2012. With 15 brands, including Harvester, Toby Carvery and All Bar One, M&B currently has 1,600 restaurants and pubs in the UK.
Paul Harvey, Travelodge Managing Director for Development, said: “The pub companies have noticeably stepped up their development plans over recent months and in many parts of the country their target locations correspond with ours.
“We have been contacted by all the major players in the market and we are now pro-actively seeking out sites with them. A combined hotel/pub development is attractive to banks and funders, making the development process a lot quicker than it otherwise may be”.
Brigid Simmonds, Chief Executive of the British Beer & Pub Association, said:
“While pubs have faced tough times in recent years, this is a great example of how they are fighting back. Pubs are perfectly placed to provide the hospitality at sites next to hotels. Pubs now serve more than one billion meals each year and are diversifying in many ways to serve their local community. Innovation like this is a key ingredient in making a success of new pub openings – and it’s a success story we should be highlighting.”
The attractions for both parties of co-locating are:
• Affordability - Developing a site together enables both Travelodge and the pub companies to build on sites that would be unaffordable on their own and provide customers with the best locations.
• It provides Travelodge guests with a quality food and drink offer and the pub companies with on-site customers.
• It makes development easier thanks to the shared parking and reduction of total land take.
The initiative also follows the successful integration by Travelodge of 52 Innkeepers Lodge Hotels that the company acquired in July 2010, all of which have an M&B pub on site.
In the last six months, Travelodge has exchanged on two properties with the pub companies:
Kidderminster: Travelodge will be developing a 53-room hotel on land adjacent to an existing pub. The development has been forward funded by Marstons.
Glossop: Travelodge will be opening a 62-bed hotel alongside a JD Wetherspoon of 7,000 ft in the re-development of the vacant Howard Town Mill.