Spirits high as liquor-licence prices hit €75k
Prices for liquor licences have experienced a revival in recent months as they are reckoned to have jumped by about 36pc and are now achieving about €75,000 per licence.
Demand is coming from major supermarket chains, stand-alone off-licences and petrol filling stations -- sectors of the retail sales market which have withstood the downturn in the economy.
Property consultants CB Richard Ellis are currently acting for four clients who are seeking to acquire about 10 licences with court dates for applications in December and January.
"They will pay in the region of €75,000 for a suitable licence," says John Hughes of CBRE.
However, he acknowledges that this price may not be sustainable. "As our clients have a court date there is probably a premium attributable to the price they are offering," he adds.
At one time during the start of the Celtic Tiger era, a record IR£600,000 (€768,000) was paid for a liquor licence. However, in 2000 the law was changed which made it easier to open a pub or an off-licence while tougher drink driving laws saw more pubs in remote rural areas going out of business.
Consequently the price of licences fell to around €180,000 in Spring 2008.
Over the two years since the onset of the recession, developers stopped building new developments with bars and meanwhile some of the stand-alone off-licences were under competitive pressure from supermarket and discount chains which were extending their opening hours.
So by the middle of this year the price of a licence hit a new low of €55,000.
One of the problems about selling on the licences is that it reduces the value of the property to which it is attached. However, such a concern does not apply to publicans who wish to retire and adapt the property to residential accommodation or who see an opportunity to convert it into a take away, a boutique or a bookies shop.