Jonathan Downey, owner of London’s Milk & Honey bar, takes to social media to share news he won’t be reopening without a rent holiday; it is likely he is set to head a wave of similar announcements
Just as happened to venues like Keith McNally’s Lucky Strike in New York, a wave – perhaps, excuse the pun, even a flood – of closures of bars and restaurants is likely coming in London and across the rest of the UK. As a result of coronavirus most recently and due also to landlord’s charging extortionate rents and council’s levying excessive business rates in the years prior, we could soon sadly end up with far ‘drier’ high streets.
On Wednesday night on Facebook, in an impassioned plea, the owner of the Soho institution that is Milk & Honey – a “prohibition-style speakeasy cocktail bar” where ‘house rules’ include: “Gentlemen will remove their hats. Hooks are provided. Gentlemen will not introduce themselves to ladies. Ladies, feel free to start a conversation or ask the bartender to introduce you. If a man you don’t know speaks to you, please lift your chin slightly and ignore him” – Jonathan Downey shared news that post the coronavirus lockdown ending, his venue might “never reopen.”
In his post, multiple venue owner-operator Mr Downey stated:
This is Milk & Honey in Soho. A very special place that was 18yrs old last week. It’s been the ‘World’s Best Bar’ (a few times) and the making of so many great bartenders, but we may never re-open. Our annual rent is £210,000 but, despite the current closure and no hope of re-opening for months, our landlord won’t allow any deferral or rent free. He expects payments to be made upfront. He’s got no chance.
One of three things will happen (in most likely first order):
– We give the keys back.
– We get a 9 month #NationalRentFree and re-open paying rent for another 18yrs.
– The landlord backs down/sees sense.
I’ve written back to our landlord. I don’t expect we’ll get anywhere and without a #NationalTimeOut, we won’t be able to re-open Milk & Honey. Including VAT, we’ve paid more than £3.9m rent in 18yrs.
Going further, Downey shared the letter he’d written to his landlord. It read:
We won’t be paying any rent on this site again this year. I’m sorry but you’re kidding yourselves if you think otherwise. We have no income.
We have been paying rent there for 18 years, totaling in excess of £3m. We have no idea when we may be allowed to re-open. Even when we are allowed to re-open, we won’t because fear of the virus and physical distancing will mean we will be loss-making. The best (and possibly only) time we can expect to re-open is once a vaccine becomes widely available. Until then, zero income = zero rent.
I have been campaigning for a #NationalTimeOut for tenants and landlords, which includes a 9 month #NationalRentFree. If we get this, then there may be a way through for all of us. Otherwise, we’ll be giving back the keys and surrendering the very valuable 03:00 licence.
I am happy to discuss if you want but that’s our position and we don’t have any other.
Previously, in an interview with The Caterer earlier this month, Downey commented:
The best thing for most people in our industry is a National Time Out – nine months rent-free, with a matching debt repayment holiday for our landlords. Understandably the pubcos don’t like it, but it is being supported by UKHospitality.
We can’t each negotiate 150,000 separate agreements with landlords. We need a national arrangement that everybody falls in line with, that the government decides and legislates on.
We should get the rest of this year rent-free – for most businesses it’s the biggest single cost apart from staff – and extend loan terms for landlords, because if they can’t get their rent for nine months, they can’t repay the debt for the premises. If they have borrowed, they should get a nine-month repayment break. It should be pushed back onto the banks – they can handle nine months of not having loans repaid.
Of the longer-term, he added:
I don’t see anybody doing well. Nobody will do well out of the crisis. I think there will be even more empty high street sites. My next business will probably have to be something outside the hospitality industry. Certainly, the business I’m in – large-capacity venues – I don’t see coming back until there’s a vaccine, which is a year or maybe 18 months away. Maybe I’ll take a year off and come back in the way that music festivals will have to. We needed a shake-up as an industry, but we didn’t need one so brutal.
That, to a large extent, the business model of a lot of hospitality businesses is hopelessly flawed. It’s ridiculously fragile, the margins are far too slim and it’s just not sustainable. We were fucked after 10 days to two weeks of no and low income.
I think there’s going to be a lot of reflection and soul-searching and realising that, despite these brilliant things we do as individuals and businesses, if the business model doesn’t stack up, you’ve got to find another way or find something else to do.
We can’t pay people what we need to pay them, we can’t pay the rent, we can’t deal with business rates at this level and with VAT at 20%. It’s just insane. Everybody wants something for nothing. In hospitality we always try to deliver, but this has made us realise we can’t deliver the impossible or the unsustainable.
Since its inception, The Steeple Times has advocated the premise of ‘use it or lose it’ for bars and restaurants and today we join Jonathan Downey in calling for #NationalRentFree and #NationalTimeOut. Now, we must all unite in coming together to support our favourite establishments as otherwise, just like many of us found with the closure of the very much missed La Brasserie in South Kensington in March 2017, we’ll again be left crying into our caipirinhas with nowhere to go.