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The Caterer

Regional Spotlight: Kensington & Chelsea

23 June 2004
Regional Spotlight: Kensington & Chelsea

When it comes to the old estate agent mantra of "location, location, location", they don't come much better than the London Borough of Kensington and Chelsea.

One area which has seen a lot of activity recently is freehold pubs, which are usually thin on the ground in such prime locations.

David Gooderham, one of the three founders of London-based chartered surveyor AG&G, says the pub market was relatively settled for a number of years leading up to 2001. But since then it has been "unusually buoyant", with some 13 freehold pub sales in the Chelsea postcodes of SW3, SW7, and SW10.

As elsewhere the local market has been affected by spiralling residential values. And unfortunately for fans of traditional "local boozers", the trend in recent years has been to convert the properties into residential and restaurant use, reflecting their higher alternative use value (HAUV).

Prices are predictably high, and Gooderham says that in the five cases in which AG&G was involved, the freehold pub properties achieved handsome profits over book value, with an average of more than £2m.

But while the local freehold market has shown signs of slowing over the last 12 months, Gooderham says there are still a number of leasehold properties in the area offering a cheaper alternative.

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