24 June 2013

The benefits of being tied down

First time investors in search of a working pub normally work their figures on the rent paid – but it’s a mistake to ignore tied income.

In the case of the Richmond Arms on Godalming’s High Street, which is for sale through licensed leisure specialists AG&G at a freehold guide price of £475,000, the tie could generate a considerable bonus.

As well paying a passing rent of £21,000 a year – the pub is leased until mid-2016 – the tenants buy beer, cider, food and beverages from the landlord’s nominated supplier.

“That might sound like a lot of work for an investor new to the sector but we can provide comprehensive advice on how to maximise the revenue from the tie while keeping a good relationship with the tenant,” says AG&G’s Michael Penfold.

“The new owner would also get a handsome asset. The Richmond Arms goes back centuries, was a coaching inn and is in an excellent location in this popular commuter town, just 35 minutes from the centre of London.”

English Heritage believes the main structure of the building is early 18th century, with 19th and 20th century additions, and has listed it Grade II.

The ground floor has a front bar area and a raised rear bar with kitchen and customer lavatories. Tenant accommodation is on the upper two floors, which include five rooms, a bathroom and storage. Standard cellarage and storage is in the basement.

For further information, contact Michael Penfold on 020 7836 7826 or e-mail michael@agg.uk.com

AG&G are chartered surveyors specialising in the licensed leisure industry, with the skill and experience needed to value, assess or promote a property not simply as bricks and mortar but as a business. If it involves the price of a licensed premises, its profitability, rental value, investment prospects or value in a dispute, AG&G can help.

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