‘Bunfight’ buys drive-thru as pandemic drives customer demand

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Restaurant and cafe chains are in a ‘brawl’ over drive-thru sites as an increase in demand during the pandemic has seen them become one of the most demanded parts of the real estate market.

Experts in commercial real estate told The PA News Agency that the number of drive-thru locations has increased since 2015, with the pace of growth continuing since the pandemic.

According to property advisor Altus Group, the number of drive-through and drive-thru restaurants in England and Wales increased by 41% in the five years leading up to the end of 2020.

He added that this growth has shown no signs of slowing down recently, with two new drive-thru locations each week bringing the total to 2,528 at the end of June.

Nonetheless, the difficulty of developing new locations has also pushed up the prices of existing locations, as McDonald’s, Greggs and Starbucks all seek to expand in the region.

Mcdonalds

(AP Archives)

Property experts say they have seen companies offering bonuses of up to £ 200,000 to help secure developer drive-thru locations.

Ross Wilkie, commercial real estate specialist and director at Colliers International, said the market had become “increasingly crowded”.

He told PA: “There’s really a lot of competition out there right now – for the best sites it’s an absolute fight.

“Many of the more traditional operators, McDonald’s and KFC for example, saw real resilience during the pandemic and therefore looked into it.

“But there are also a lot of growing companies, some new to the UK or expanding their models, moving in, so it’s unsurprisingly incredibly crowded.”

In recent years, there has been an influx of new drive-thru operators, with the Canadian chain Tim Hortons launching its first out-of-town locations after regional openings at department stores and the U.S. operator of Popeyes fried chicken aimed at launching sites in UK.

Healthy fast food operator Leon last month announced plans to open its first drive-thru and expand with new openings, following its takeover by forecourt giants EG Group.

Nick Ayerst, chief executive of Leon, said the company has had lengthy discussions about its expansion and has recently seen an acceleration in consumer demand.

An artist’s impression of Leon’s first drive-thru appearance

He said: “We have been discussing the first Leon drive-thru with EG for five years now, and we are delighted to open in West Yorkshire later this year.

“This is an important step for Leon.

“It is clear that the pre-Covid drive-through sales growth has accelerated with changes in consumer behavior and is unlikely to be reversed.

“Giving our customers the ability to eat Leon’s fast food naturally in many other easily accessible places is a central part of our strategy, drive-thru is a key part of that strategy. “

Meanwhile, Starbucks is among the most established drive-thru operators to rapidly expand their portfolios recently.

The US-based coffee company has opened 38 drive-thru locations since last September and said the ability to trade them during the lockdown period was key to that.

“It has clearly been an incredibly difficult year with Covid-19 imposing operating restrictions on our business – and it has had a dramatic impact on profitability

“Second, the pandemic has really accelerated customer demand for convenience.

“As a result, we have further increased our investments in drive-thru, delivery, mobile orders and our loyalty program to put ourselves in the best possible position as we envision the future of our business. “

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