Whitbread has accepted offers totaling £56 million for the sale of 51 of its branded restaurants and bars.
This sale follows Whitbread’s earlier announcement that it plans to convert 112 branded restaurants into 3,500 Premier Inn hotel rooms, in addition to exiting 126 branded restaurant sites altogether.
Simon Ewins, managing director at Whitbread, mentioned during the Annual Hospitality Conference last month that some of the company's restaurants had become a 'distraction' to the business.
In its half-year results, Whitbread confirmed that planning applications have been submitted for more than a third of its restaurant sites slated for conversion into hotel rooms. The first approvals have already been granted, and construction is underway, with the new rooms expected to be fully operational by the end of 2026.
Whitbread has sold 51 of its restaurants, including those operating under brands like Bar + Block, Brewers Fayre, and Beefeater. The company is now in the process of replacing these locations with an integrated ground-floor food and beverage offering across its portfolio.
Total food and beverage (F&B) sales for Whitbread were down 7% during the period, largely due to the restructuring and changes made to its branded restaurant segment.
“The majority of our hotels, including those serviced by one of our existing 387 integrated restaurants or our remaining portfolio of 196 higher returning branded restaurants, are continuing to operate as normal,” the group added.
Whitbread reported an adjusted profit before tax of £340 million for its rooms segment, which is slightly lower than the £391 million recorded in the first half of the 2024 financial year (H1 FY24).
In London, occupancy levels remained strong at 81.5%, while regional occupancy was even higher, reaching 83.5%.
During this period, Premier Inn added 780 new rooms to its portfolio, including its inaugural joint development featuring both Premier Inn and ‘Hub by Premier Inn’ in London's Paddington.
Additionally, it closed 304 rooms as part of its strategy to optimise its estate, resulting in a total of 855 hotels and nearly 86,000 rooms as of 29 August 2024.
By the end of FY30, the group aims to expand its estate to 98,000 rooms, with a longer-term goal of reaching 125,000 rooms across the UK and Ireland.
Dominic Paul, chief executive of Whitbread, said: “In the UK, we have a clear pathway to further extend our market-leading position and capitalise on the favourable UK supply backdrop. We are determined to build on our significant outperformance since the pandemic and whilst the market has been slightly softer than last year, we remain on course to grow our UK returns substantially over the medium-term whilst continuing to deliver for our customers, as evidenced by our high guest scores.
“Our passion for operational excellence, together with our brand strength, scale and value proposition, are sustaining our strong performance and revenue per available room premium versus the rest of the UK meetings and events sector.”
Premier Inn holds a 12% share of the total hotel room supply, making it the largest hotel chain in the UK.