Gyms, cafes and cinemas expand into vacant retail spaces adding 8,000 new leisure units in UK in a year
The number of leisure properties in the UK has increased from 291,000 to 299,000 in the past year*, as the leisure sector expands into vacant retail space.
The number of shops and other retail units in the UK has fallen from 511,000 to 510,000 over the same period. More retailers have been forced to close as consumers reduce spending during the cost-of-living crisis. On top of this, retail properties now have a vacancy rate of 13.9%**.
Reduced demand from bricks and mortar retail coupled with lower rents and more competitive deals for vacant space on high streets and in shopping centres has allowed more leisure operators to lease premises that they might not previously have been considered available.
In a move to attract leisure businesses, some shopping centres are undertaking major structural reconfiguration of their shopping centres to accommodate leisure businesses, rather than just offering them empty retail spaces.
"Leisure businesses are also taking up prime high-street locations that were previously just the domain of retailers. This progression has been aided by commercial property investors starting to view leisure businesses as an attractive investment asset class in their own right, rather than as a retail ‘bolt-on’."
Leisure subsectors which have expanded their number of units in the past year include:
- Gyms, which have increased by 8% from 4,400 units in 2021 to 4,750 in 2022
- Cafes, increasing 2.4%, from 16,070 to 16,450
- In-store cafés have increased by 17%, from 640 to 750, as retailers install them to encourage shoppers to spend more time in store
Retail subsectors that are shrinking include:
- Markets, which have fallen by 24%, from 980 sites in 2021 to 740 sites in 2022
- Post offices have decreased by 3.5%, from 2,290 sites to 2,210
"There’s a fundamental change happening on British high streets. More leisure turns shopping centres and high streets into their own destination, bringing friends and family together for longer dwell times. These people are more likely to spend elsewhere and revisit."
A lot of leisure concepts have become a lot more common. As well as cinema’s and bowling there are now a number of exciting concepts including, family entertainment centres, indoor golf, go-karting, trampolining, rock climbing, axe throwing, football, table tennis and escape rooms.
* Source: Valuation Office Agency. Year end March 31 2022
**British Retail Consortium
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For more information on this update, or any Retail & Leisure matters, please contact Terence Ritchie.