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Heineken pledges nearly $50 million investment for "transforming tired pubs" in U.K. into eco-friendly faces of resilience

Inside the English pub's comeback from COVID
Inside the English pub's comeback from COVID | 60 Minutes 13:19

Dutch brewing company Heineken is working on "transforming tired pubs" across the U.K. with a nearly $50 million investment meant to ease locals as the U.K. recovers from a 41-year inflation high.  

The £39 million (nearly $50 million) investment is being made through Heineken UK's Star Pubs, a network of 2,400 leased-out bars. Heineken said that the money will go toward 612 establishments, including 62 closed pubs that will now be reopened this year. Some of those soon-to-be-reopened pubs have been closed for more than four years, CBS News partner BBC reported. 

The company said the investment is a demonstration of "confidence in the resilience of the great British local in the face of uncertainty." 

"With working from home more commonplace and people looking to save on travel, major refurbishments will concentrate on transforming tired pubs in suburban areas into premium locals," the company said. "The revamps are designed to broaden each pub's use and appeal, giving people additional reasons to visit."

Heineken says the work will create more than 1,000 new jobs as the U.K. battles a cost-of-living crisis. 

According to the British Beer and Pub Association, the number of pubs across the U.K. have slowly been declining for decades, but the pandemic and energy crisis amplified the situation. Since 2000, about 15,450 pubs have been shuttered while the cost for pints of beer has only increased, data from the association shows. 

Among the planned refurbishing changes are "state-of-the-art" equipment to provide customers with "consistently perfect pints," dividing screens and aesthetic changes that the company said "will have a stylish classic feel, providing longevity." 

They also plan to implement more eco-friendly changes, including heating controls, insulation and low-energy lighting that Heineken says will cut energy use by 15%. 

"People are looking for maximum value from visits to their local. They want great surroundings and food and drink as well as activities that give them an extra reason to go out, such as sports screenings and entertainment," Star Pubs' managing director Lawson Mountstevens said. "Creating fantastic locals that can accommodate a range of occasions meets this need and helps pubs fulfill their role as vital third spaces where communities can come together."

The move comes as the U.K. has faced issues with the cost of living in recent years. According to the Parliament, costs increased dramatically in 2021 and 2022, sparking a 41-year inflation high in October 2022 of 11.1%. The annual inflation rate dropped substantially to 3.2% in March and is expected to continue falling throughout the year as energy prices also fall. 

However, while the inflation rate has dropped, global conflict and other issues have caused food prices to rise in the past two years. Even as pressures have eased, the Parliament said, food and non-alcoholic drink prices were 4% higher this March than last year, with food prices overall rising by nearly 24% from March 2022 to 2024. 

In a survey conducted by the Office for National Statistics, nearly half of U.K. adults say their cost of living expenses have increased this year, with food prices being the primary reason. 

BBPA chief executive Emma McClarkin told the BBC that Heineken's plans are "a demonstration of the confidence to invest in Britain's beer and pub sector which will help generate much-needed growth in local economies across the U.K."

"This could be turbo-charged with a longer-term and more supportive fiscal and regulatory framework that this and the next government needs to put in place to unlock further growth and investment opportunities," she said. 

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