Elephant & Castle Group

Hotel & Motel Management, August, 2004

Hotel executives seeking new strategies for food and beverage operations need look no further than Elephant & Castle Group, Inc., operators and franchisors of one of North America's fastest-growing chains of authentic English pubs. The December 2003 issue of Nation's Restaurant News noted that British- and Irish-style pubs are gaining a following in a niche that's not overcrowded, and identified Elephant & Castle as one of two chains leading the charge.

All 10 of Elephant & Castle's U.S. locations are associated within hotels, including Clarion, Club Quarters, Crowne Plaza, Holiday Inn and West Coast Grand Hotels. Over the last year, the company has introduced a joint venture program whereby hotels share in both the investment and profits from the restaurant.

"Hotels and restaurants are both driven by guest satisfaction," explains Elephant & Castle President and CEO Rick Bryant. "Our joint venture program enables hotels to do what they do best: provide excellent service to guests, confident that Elephant & Castle--a well-known, respected restaurant brand--is offering high-quality food and beverage services to those same guests. The joint venture program creates guest satisfaction, which drives brand loyalty for both hotels and restaurants. At the same time, the arrangement enables hotel owners to obtain the maximum return on their real estate investments."

Elephant & Castle's first joint venture restaurant, associated with San Francisco's new Club Quarters, recently celebrated its one-year anniversary. "Despite the struggling local market, the restaurant has enjoyed a robust lunch and after-work business, thanks to our popular menu and the great location, which is in a new hotel right in the heart of the financial district," says Bryant.

"Our joint venture program is a unique, win-win opportunity for hotels looking to partner food and beverage operations with a successful restaurant brand," adds David Evans, vice president of franchise development. "No other national restaurant brand is doing this with hotels--they are either leasing outright or franchising."

Elephant & Castle's appeal results from a blending of design elements reminiscent of modern-day England. A healthy mix of food and liquor business appeals to a broad range of patrons. Young singles and families, travelers and locals, socializers and business clientele find a warm and welcoming ambiance at Elephant & Castle.

The ideal Elephant & Castle joint venture location, according to Evans, is a ground-level space in an urban hotel with a number of high-density buildings nearby. Minimum space requirement is about 5,000 square feet, and Elephant & Castle can build out to fit most configurations.

Company officials report they are negotiating to add four additional joint venture restaurants which, like the San Francisco location, will be associated with hotels.

Elephant & Castle also operates corporate-owned restaurants and sells franchises. Founded in 1977, the public company, traded under the symbol PUBSF, operates 23 restaurants throughout North America.

Company Profile

Elephant & Castle International, Inc.

13300 Old Blanco Road, Suite 323

San Antonio, TX 78216

Web site: www.elephantcastle.com

Key contact

David Evans, Vice President of Franchise Development

Phone: (210) 764-1911

Fax: (210) 764-1922

E-mail: devans@elephantcastle.com

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