The economic downturn has meant a slowdown in the number of rent reviews being carried out, according to property agent Fleurets
Tough economic times have also led to a ‘general downward pressure on rents,’ said director David Sutcliffe in the firm's annual rental review.
Sutcliffe said there had been ‘relatively few’ new lettings of freehouses and high street bars, along with a ‘significant decline’ in rent review activity, as landlords realised the ‘limited opportunity for rental growth’.
“Landlords aren’t actioning rent reviews, or if they are it’s being quite contentious and therefore many haven’t been settled,” he added.
Growth in London market
The statistics showed there is still growth in the London market when it comes to traditional pub rents — the City of London saw a 23 per cent increase in rent over the last five years — which along with the Midlands represents the highest levels in the country, thought most of this growth pre-dates the current downturn.
The City of London also saw the largest increase in the past 12 months from £79,688 to £87,250.
Traditional pubs in the South East still pay the highest rent nationally outside the capital at £52,252. Those in the North have fallen by 2.2 per cent over the last five years to a low of £39,801.
High street bars produce highest rents
The capital’s high street bars continue to produce the highest rents in the country, although Fleurets said “upward only rent reviews can produce a skewed analysis in a declining market”.
London’s West End bars saw a 16 per cent increase over the last five years to £230,897 in 2009.
Elsewhere regional rents at high street bars have been relatively consistent, albeit well-below inflation over the last five years.
The South West and Wales have shown an 8.5 per cent decline in rents over last five years. All areas were above £100,000 in 2004 and show little difference in 2009.
Gemma McKenna is senior reporter on BigHospitality’s sister title The Morning Advertiser.