The group has agreed terms and exchanged contracts for the disposal of five pubs on the South Coast of England, which include three pubs in Brighton (Walrus, Brighton Beach Club, and Lion and Lobster), The Inn on the Beach on Hayling Island and The Travellers Friend in Woodford Green, Essex.
All are freehold pubs, with the exception of Brighton Beach Club which is leasehold. These five pubs, which had a net book value of approximately £17.1 million as at April 2022 and recorded unaudited aggregate site EBITDA of £0.7 million for the year ended 26 December 2021, are being acquired by Portobello Starboard for £16.2m.
This transaction is expected to complete on or around 11 April 2022, subject to successful lease assignment of the Brighton Beach Club.
Separately, the company has sold The London Road Brewhouse, a freehold pub in Southampton for around £900,000. This sale completed on 18 March 2022.
The proceeds from the pubs will be used to invest and expand the group in other geographies across the UK.
Clive Watson, Chairman, said: “We have achieved a good price for these assets. The capital realised makes us debt free and in an excellent position to take advantage of the current market dislocation to further premiumise our estate and deliver long term growth through selected acquisition.”
Separately, Portobello, which is backed by Portobello Brewery and Zetland Capital, has also completed the acquisition of the Grand Victorian pub in Worthing from Dominion Hospitality, an affiliate of Stellex Capital Management.
A large Victorian 18-bedroom freehold pub with rooms dates back to 1898 and is located opposite Worthing’s central station. Portobello is planning an extensive refurbishment programme for the Worthing pub as well as development of the adjoining disused nightclub to create a flagship site with 36 en-suite bedrooms later this year, bringing the total number of bedrooms across the estate to 58.
Mark Crowther, chairman, commented: “We are delighted to announce these acquisitions as we progress our strategy of acquiring predominantly freehold managed pubs across London and the South East. The south coast sites will give us scale in that geography whilst also growing our London presence. We look forward to welcoming our new colleagues into the Portobello family, whilst bringing our award-winning beers to the customers of these new pubs.”
The City Pub Group sale to Portobello was brokered by James Grimes at leisure property specialists AG&G.