UK: Heineken to invest £39 mln to reopen more than 60 closed pubs in the UK

Brewing giant Heineken will reopen 62 pubs that were closed in recent years and invest £39m in refurbishing hundreds of sites across the UK, BBC reported on May 6.

The company said the cash injection into its Star Pubs & Bars chain will create more than 1,000 new jobs.

The UK pubs industry has been hard hit by closures both during the Covid pandemic and afterwards as cost of living pressures weighed on consumer spending.

Between 2021 and 2023, pubs have shut at a rate of 500 a year, according to the British Beer and Pub Association (BBPA).

Star Pubs & Bars currently operates 2,400 pubs. In 2019, it had 2,700 pubs across the UK.

A spokesperson for Star Pubs & Bars said: "It would be unrealistic for any major leased and tenanted pub company to have all its pubs open at any one time."

They said the number fluctuates on a range of factors, but added: "Around 95% of ours pubs are open at any one time."

Star plans to renovate more than 600 pubs, choosing locations it said reflect how many of its customers have cut back on how often they commute into city centres.

Heineken said: "With working from home more commonplace and people looking to save on travel, major refurbishments will concentrate on transforming tired pubs in suburban areas into premium locals."

The company said that by the end of this year, the UK operation will have reopened 156 pubs since the start of 2023, "reducing the number of closed pubs in its estate to pre-pandemic levels".

During Covid, pubs were forced to close to prevent the spread of the virus. When they were allowed to reopen, they faced a number of restrictions including mandatory table service, limits on the size of groups and a 22:00 curfew.

In early 2021, Heineken announced it would cut 8,000 jobs globally. The following year it warned inflation - which measures the pace of price rises - was "off the charts", in particular on commodities such as barley and aluminium.

This was before Russia's invasion of Ukraine in late February 2022 which lifted the cost of energy, fuel and grains.

The average price of a pint of draught lager reached £4.71 in March, according to the Office for National Statistics, compared to £3.76 in February 2020 before widespread pandemic lockdowns the following month.

Meanwhile, the number of pubs in the UK has fallen from 47,200 in 2019, before Covid, to 45,350 in 2023, data from the BBPA shows. However, pub numbers have been declining for some time. A decade ago there were 52,500 in operation which is 7,150 more than 2023.

Some of the pubs that Heineken is re-opening have been shut for more than four years, others have been closed for 12 months.

The Ship in Worsbrough, Barnsley closed its doors four-and-a-half years ago and lay dormant until it was refurbished at a cost of £370,000 and reopened in February 2024.

The Ashford Arms in Derbyshire, which Star Pubs described as "a Covid casualty", was shut in March 2020 but reopened after joint £1.6m refurbishment by the company and Longbow Venues, an independent hospitality business in the Peak District.

The Coach & Horses in Carlisle was shuttered for a year and, according to Star Pubs, "had a poor reputation and few customers".

“People avoided the pub for years," according to its licensee Susan Graham. It has since been revamped at a cost of £300,000. "[Customers'] chins hit the floor when they saw the change," she said.

Heineken hopes the revamp of its pubs will tempt drinkers and diners back, including using "subtle zoning" to allow customers to enjoy different activities like watching sports and dining "without disturbing each other".

It said it will use dividing screens and distinct changes to lighting, sound systems and furniture styles to "help delineate the zones".

The announcement by Heineken is the latest indication that the British pub industry is seeing signs of growth after major blows from the pandemic and the cost of living crisis.

Last week, major pub chain Greene King said it would open its new £40m brewery by 2027.

Greene King, known for brands such as Abbot Ale, Greene King IPA and Old Speckled Hen, said the move represented a "long-term commitment to British brewing".

The 225-year-old company, which was sold to Hong Kong operator CKA in 2019, owns about 2,700 pubs, restaurants and hotels in the UK.

Spain’s Damm recently announced it will invest £50m in a new brewery in Bedford. It bought the site in 2022 from Carlsberg Marston’s Brewing Company.

Emma McClarkin, chief executive of the BBPA, said the plans are "a demonstration of the confidence to invest in Britain’s beer and pub sector which will help generate much-needed growth in local economies across the UK".

She added: "This could be turbo-charged with a longer-term and more supportive fiscal and regulatory framework that this and the next government needs to put in place to unlock further growth and investment opportunities.”

In the Budget in March, Chancellor Jeremy Hunt announced that a freeze on alcohol duty would continue until February 2025. It had been set to end in August.

He also extended a 75% discount to business rates for retail, hospitality and leisure firms until 2025. It is worth up to £110,000 per business.

Some of the sites that Star Pubs & Bars, owned by Heineken, is reopening this year include:

The Black Bull in Ecclesfield, Sheffield
The Hesketh Tavern in Cheadle Hulme, Stockport
The Junction in Wombwell, South Yorkshire
The Manvers Arms in Radcliffe on Trent, Nottinghamshire
The Punch Bowl in West Hallam, Derbyshire
The Rose of Denmark in Bristol
Roxy’s Steak & Tap in Twickenham
The Talbot in Cheslyn Hay, Staffordshire
The Wildmoor Oak near Bromsgrove
The Winterton Arms in Chiddingfold, Surrey

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