Private Equity Investors Lose Their Thirst For Dublin Pubs

Private equity investors largely left Dublin’s pub investment market in 2022, as a total of 23 pubs changed hands, with transactions valued at €51.5M, according to a new report by agent Lisney Morrisseys.

Transactional activity throughout the year was more in line with the 10-year average following the exceptional peak witnessed in 2021 after a spate of private equity acquisitions, which more than doubled the average value of the market.

In 2021, 30 deals transacted with a combined value of €124M, primarily due to deals by private equity firms, most notably the UK-based Attestor.

By contrast, publicans re-emerged as the main purchasers in 2022 as private equity buyers reduced from 37% of deals in 2021 to complete only one Dublin transaction in 2022.

This reflected returning confidence from the traditional base of publican purchasers in the outlook for the trade, despite energy, inflationary and staff challenges, Lisney Morrisseys said. 

Publicans purchased half of the 2022 pubs sold, representing 37% of the amount spent. This compares to 37% of deals and 15% of spend in 2021. Investors also increased their market share, accounting for 39 of the deals and their percentage of spend rose from 5% to 36% in 2022.

Lisney Morrisseys attributed the reduction in private equity purchases largely to scarcity of stock meeting their specific set of requirements and speculated that PE money may focus on opportunities in cities such as Galway, Cork, Limerick, Waterford and Kilkenny.

“Appetite from this sphere of the market continues to be rooted in a preference to acquire scale through the purchase of established pub groups or a collection of high-value premises at the same time,” the agent said.

Demand for good city premises remained strong and the most valuable pub deal saw private equity group Attestor add The Bleeding Horse on Camden Street to its stable. David L’Estrange, who owns a number of pubs in partnership, sold the landmark property for around €9.2M.

Lisney Morrisseys said that strong appetite remains as purchasers continue to seek out opportunities, most of which are being explored off-market.

The agent said that it believes private equity will feature again in 2023 but activity levels will be dependent upon their ability to secure top- tier prime assets.