‘Bunfight’ to buy drive-thrus as pandemic sparks customer demand
The number of drive-in and drive-thru restaurants in England and Wales increased by 41% in the five years to the end of 2020.
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Your support makes all the difference.Restaurant and cafe chains are in a “bunfight” for drive-thru sites as a surge in demand during the pandemic has seen them become one of the most in-demand parts of the property market.
Retail property experts have told the PA news agency that the number of drive-thru sites has surged since 2015, with the pace of growth continuing since the pandemic.
According to the real estate adviser Altus Group, the number of drive-in and drive-thru restaurants in England and Wales increased by 41% in the five years to the end of 2020.
It added that this growth has showed no sign in slowing recently, with two new drive-thru sites each week taking the total to 2,528 at the end of June.
Nevertheless, difficulty in developing new sites has also seen prices for existing locations soar, as the likes of McDonald’s, Greggs and Starbucks all seek to grow in the area.
Property experts said they have seen firms offering premiums of up to £200,000 to help secure drive-thru venues from developers.
Ross Wilkie, retail property specialist and director at Colliers International, said the market has become “increasingly crowded”.
He told PA: “There really is quite a lot of competition there right now – for the best sites it’s an absolute bunfight.
“A lot of the most traditional operators, McDonald’s and KFC for example, saw real resilience there during the pandemic so have leaned into it.
“But there are also plenty of growing firms, some new to the UK or expanding their models, who are moving in, so it is unsurprisingly incredibly crowded.”
Over the past few years, there has been an influx of new drive-thru operators, with Canadian chain Tim Hortons launching its first out-of-town sites after regional high street openings and US fried chicken operator Popeyes aiming to launch UK sites.
Healthy fast-food operator Leon announced plans last month to open its first drive-thru and expand with further openings, after it was bought by forecourt giants EG Group.
Nick Ayerst, managing director at Leon, said the company has been in lengthy talks over its expansion witnessed an acceleration in consumer demand recently.
He said: “We’ve been discussing the first Leon drive-thru with EG for five years now, and we’re excited to open in West Yorkshire later this year.
“This is a significant milestone for Leon.
“It is clear that the pre-Covid growth in drive-thru sales has accelerated with changes in consumer behaviours and it’s unlikely to reverse.
“Giving our guests the chance to eat Leon’s naturally fast food in many more locations that are easy to access is a core part of our strategy, drive-thrus are a key part of that strategy.”
Meanwhile, Starbucks is among more established drive-thru operators to rapidly expand their portfolios recently.
The US-based coffee business has opened 38 drive-thru sites since last September and said the ability to trade these through lockdown period was key to this.
“It has clearly been an incredibly challenging year with Covid-19 placing operating restrictions on our business – and that has had a dramatic impact on profitability
“Secondly, the pandemic has really accelerated customer demand for convenience.
“As a result we’ve further increased investment in drive-thru, delivery, mobile order and our loyalty programme to put us in the best possible position as we look ahead to the future of our business.”