Heineken to pump £39m into reopening and revamping UK pubs | Food & drink industry

Heineken is to spend £39m on reopening about 60 UK pubs and sprucing up “tired” locals in suburban areas in an effort to attract more consumers working from home.

The firm, which has 2,400 pubs through its Star pubs and bars arm, plans to reopen 62 long-term-closed venues this year and upgrade 612 outlets, with 94 of these earmarked for makeovers of about £200,000.

It said it would concentrate its major refurbishments on suburban pubs, turning them into “premium locals” to take advantage of the shift away from office working since the Covid crisis, as well targeting people looking to save money on travel by drinking near to home.

The latest investment will create an estimated 1,075 new jobs and broaden each pub’s use, and comes amid signs of rising consumer confidence as inflation and the cost of living crisis ease.

Brewers and pubs were forced to close for months under pandemic restrictions and since then the sector has faced higher costs including energy bills and wages at the same time as consumers have cut back on discretionary spending.

The number of pubs in the UK had dropped even before Covid hit, according to the British Beer and Pub Association. Figures from the industry body show a steady decline from 60,800 in 2000 to 47,200 in 2019.

However, in recent weeks pub groups have announced plans for fresh investment in a sign of renewed confidence in the sector.

Tim Martin, the founder and chair of JD Wetherspoon, said in March he had a list of 130 towns and cities where he wanted to open a pub, as he announced an eightfold rise in pre-tax profits in the six months to January 2024.

Greene King announced last week that it would invest £40m in a new brewery in East Anglia.

Heineken UK, which is the world’s second largest brewer, said its latest investment meant it would have reopened 156 long-term-closed pubs, including ones in Derbyshire, Yorkshire and Cumbria, between the start of 2023 and the end of 2024, which would reduce the number of closed pubs in its estate to levels last seen before Covid. Most of its 2,400 pubs are leased out to small firms and entrepreneurs.

Lawson Mountstevens, the managing director of Star Pubs, said people were now looking for “maximum value” from visits to their local and wanted good-quality food and drink as well as additional reasons to go out such as sports screenings.

“Pubs have proved their enduring appeal after all the disruption of recent years. Star is on track to have the lowest number of closed pubs since 2019,” he said.