Guinness quaffs pub-sale profits

By Andrew Bushe

DUBLIN — While the price of homes continues to rise, the spiraling costs of pubs has dominated the property market, with Guinness selling off the last of its tied houses — smashing sale records twice in the process.

The brewery went into the pub ownership business in the 1960s and at one stage owned 12 but last week its sold off the last three-pack in Dublin and netted an extraordinary £12.55 million.

Pub prices have been outstripping property prices, indicating the hefty profits from drink sales as the Celtic Tiger economy results in higher disposable income.

A Dublin pub went through the £2 million barrier for the first time only two years ago and the £3 million threshold was breached on several occasions earlier this year.

Earlier this month the Halfway House in Walkinstown set a Dublin record when it was sold for £3.65 million — completely outstripping the expected £2 to £2.5 million that had been expected.

The first Guinness pub to go on the market was the Clonsilla Inn, which caused gasps at the auction when it was bided up to £4.4 million before the hammer came down to set a new record.

The brewery’s next pub, the Cherry Tree in Walkinstown, went for a more modest £3.4 million and then the record was smashed again when the Sheaf o’Wheat on the Malahide Road soared to £4.75 million.

"The decision to get out of the pub market was a commercial one," Guinness spokesman Pat Barry said. "It was felt that this was a good time to sell the last three because the market is very buoyant. The prices that we have realized confirmed that.

"At one stage we had 12 bars in Dublin, Cork and the Shannon area, but we have been slowly whittling down our involvement in the business."

Guinness also had management contracts for the student bars in UCD and Maynooth universities.

"We are in the process of pulling back from those also. The college authorities will be putting them out for contract."

The present licensing system has made some big suburban pubs in the Dublin area virtual gold mines for their owners.

In Tallaght, there is one pub for every 5,600 residents and in Clondalkin there is one for every 4,200 people.

In contrast, County Mayo is the most "over-pubbed" area in the country, with 622 licensed premises for 110,000 people — or one pub for every 179 people.