Upmarket pub chain in residential communities experiences bankruptcy and closes down operations at six locations
Oakman Inns, a popular pub and hotel chain based in Berkhamsted, Hertfordshire, has fallen into administration. This news comes as the hospitality sector grapples with rising costs and the lingering effects of the COVID-19 pandemic.
Several factors are contributing to the increase in food costs for businesses like Oakman Inns. Cost inflation, driven by global supply chain disruptions, geopolitical tensions, and changes in consumer demand, is a significant issue. Rising energy costs, wage inflation, post-pandemic challenges, and economic pressures are also straining the sector.
Despite these challenges, Oakman Inns managed to sell 13 leasehold locations and one freehold property to Uphams Inns, with 531 jobs set to be transferred. However, six sites have been closed permanently, resulting in 159 staff losing their jobs. The closure is attributed to enforced closures and restricted trading during the Covid pandemic, rising energy and food costs, and a reduction in customer spending.
The George Inn, Ludlow, Shropshire is among the Oakman Inns locations that will be taken over by Uphams Inns. The chain's development arm, Oakman Dev, has also entered administration.
Meanwhile, Uphams Inns is expanding its portfolio, acquiring 14 additional Oakman Inns locations across Hertfordshire, Buckinghamshire, the Midlands, and other regions. These include The Penny Farthing, Berkhamsted, Hertfordshire; The Beech House, St Albans, Hertfordshire; and The Three Locks, Stoke Hammond, Buckinghamshire, among others.
In a separate development, Brewdog announced earlier this week that it would close 10 locations, including its flagship bar in Aberdeen, putting around 100 jobs at risk. The bars will close on 26 July. Fortunately, no earlier mentioned Oakman Inns locations have been affected by Brewdog's decision.
Despite an open and comprehensive marketing process, no acceptable offers were received for the sale of the whole business. As a result, no earlier mentioned Oakman Inns sites have been sold to Uphams Inns or any other party.
This news marks a challenging time for the hospitality industry, with businesses needing to adapt and find ways to navigate these difficult circumstances.
Investors in the hospitality sector are facing financial challenges as costs inflate due to global supply chain disruptions, geopolitical tensions, and changes in consumer demand. This is evident in Oakman Inns' struggle to sell its entire business, resulting in the closure of several locations and the loss of jobs. However, Uphams Inns is expanding its property portfolio by acquiring 14 Oakman Inns locations, proving to be a savvy investment in the retail business sector amid these industry-wide difficulties. Meanwhile, Brewdog's decision to close 10 locations also highlights the economic pressures faced by businesses in the industry.
