Drive-throughs take the prize as hottest retail spots around

Drive-through restaurants have become one of the most hotly contested parts of the UK property market as food-to-go businesses from Greggs to Starbucks battle it out for sites away from deserted high streets.

Alasdair Murdoch, chief executive of Burger King UK, said the chain was fighting off fierce competition for properties.

“We are going hard at it and we are putting a lot of resource behind that,” he said, adding that the company was hiring more people “to be able to open more drive-throughs for 2021 and beyond”.

Starbucks, Greggs and Costa have also indicated plans to expand their drive-through portfolios, with Starbucks saying that 80 per cent of its new openings next year would have a drive-through lane.

Roger Whiteside, Greggs’ chief executive, described drive-through as the “most heavily competed property market there is”.

With dine-in restaurants closed until December 2 and consumers feeling safer picking up food from their cars, queues have stretched up to 90 minutes at some drive-through sites — a stark contrast to empty high street takeaway stores.

Taco Bell said it had to employ three marshals to monitor streams of around 20 cars going through the drive-through lane at its recently opened Milton Keynes site, while Starbucks said that with lockdowns in place, a quarter of all purchases were drive-through sales.

Drive-throughs — a concept pioneered at the In-N-Out burger shack at Baldwin Park, California, in 1948 — have benefited from being in out of town locations, where the number of shoppers has held up better than on high streets. Data from the retail tracker Springboard forecasts that over the Black Friday weekend, footfall will be 30 per cent below last year’s levels at retail parks compared with a drop of 67 per cent on high streets.

“Drive-throughs were already performing well but they have been super charged,” said John Diviney, UK managing director of the service station operator Applegreen. “Any new sites we look at will now come with a minimum of one drive through.”

The Canadian coffee chain, Tim Hortons, said it wanted to create 2,000 jobs with drive-through restaurants in “every major city and town” in the UK by 2022 — an ambition its chief commercial officer, Kevin Hydes, said amounted to “hundreds” of new sites, up from the seven it has today.

“In our last quarter . . . to beginning of October, we saw sales growth of 37 per cent on a like-for-like basis and the drive-through performance was a big part of that,” he added.

In total, the UK has 1,527 drive through sites, according to figures from the Local Data Company. Since the end of the first lockdown, 59 new sites have opened, accounting for almost a fifth of openings in the food service sector and 3 per cent ahead of the same period last year.

With fewer staff needed and typically lower rents than in town stores, they are an attractive prospect for businesses. They are also fairly easy and fast for landlords to build.

But Dominic Rodbourne, head of out of town retail at Savills, warned that with so many operators piling into the market, rents, which typically range from £25 to more than £50 per square foot for high-demand locations, could climb: “Rents are rising in the most sought after locations, generally those with dense populations, and significant offers are being made by operators in a bid to secure the most desirable sites.”

Mr Hydes said this did not worry him. “It’s a very attractive market [and that] means we have to be very focused on where we land those locations.”

He highlighted an extra rationale for the popularity of drive-throughs during lockdown: “People are sitting in their cars and eating in a car park because it’s a change from the four walls.”

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