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Introduction / Foreword
What is Experiential Leisure?
What has facilitated the emergence of the sector?
Outlook & Conclusion
Milan has the aperitivo and its fashion boutiques, Berlin has a bustling techno and dance scene, Paris has the cabaret and soon the Olympics, and traditionally you may have said that London has its theatres and the arts. However, a multitude of exciting experiential leisure venues that go beyond traditional food and drink offerings have taken centre stage within the city’s night life over recent years. Experiential leisure, a blend of interactive games and exciting night-time venues, has become a key proponent of social lives in cities across the country, and the UK has emerged as the premier market for experiential leisure operators.
In this report, we analyse what’s driven the emergence of the sector, what the sector’s maturity may mean for our cities and real estate and where further opportunities for growth may exist. In addition, we also look at how experiential leisure can be leveraged to complement and strengthen placemaking initiatives. The quantitative findings of this report are based on a comprehensive review of the experiential leisure sector in the UK. In which, we have reviewed major experiential leisure operators, and their current operating footprints across the United Kingdom.
Our review focuses on prime operators, whether that is those with multiple locations or notable independent and single site operators. As such, some regional independent operators, or those opened within the last 6 months may not be included. The data behind this research has been devised to give an indication of market size and composition and has been enriched with Cushman & Wakefield proprietary market data, in order to form qualitative and quantitative views and opinions on the sector and its implications for real estate.
ForeworD
What is Experiential Leisure?
BROAD
LEISURE FRAMEWORK
C&W Experiential Leisure SEGMENTS
Prime experiential leisure operator segment map
F&B Trends moving the goal posts
The broadening and blurring role of the city
Real Estate has presented significant opportunity
The Leisure market has presented significant opportunity
What has facilitated the emergence of the sector?
1. Inclusive experience as the key pillar of retail strategy
Following the structural changes driven by the pandemic, the cost-of-living crisis has further highlighted the consumer focus on inclusive experience and value, leading consumers to seek-out and optimise value and experience from their spare time. In an environment characterised by words such as perma-crisis, consumers are placing greater focus on experience and escapism. Inclusive experience focuses on the removal of barriers for participants, allowing a broader mix of consumers and households to access experiences. The rise of experiential leisure and competitive socialising has seen leisure operators steer away from wet-led operations, monetising pay to play time and reducing the need for alcohol consumption on-site.
Incorporating games and interactive activities provides engaging talking points and focal activities, offering diverse and broad groups higher quality entertainment compared to traditional leisure venues.
Economic pressures in recent years have made price competition, typically one of the key components of retail strategy, increasing costly. Away from the discounting and loyalty programmes of the supermarkets, retail strategy has rapidly pivoted to focus on the delivery of improved consumer experience, harnessing a new wave of retail media, product offering and blend with a much-improved focus on fit-out and feel of retail locations. This trend also has substantial implications for the leisure sector and has driven an evolution of F&B concepts, with greater focus being placed on overall experience through “Instagramable” spaces, cultural connections, and spaces that encourage interaction and engagement.
Corporate experience and employee satisfaction has also grown in importance over recent years, with employee retention, workplace culture and satisfaction now a key consideration for office occupiers. Day to day, this means greater emphasis is being placed by employees and employers on ensuring social events are in the calendar, benefitting experiential leisure locations in densely populated cities with a large office-based workforce. As a result of the return to the office and greater inter-twining of retail and office visits, experiential leisure venues have successfully captured a strong corporate customer base throughout the week, focusing attention during Monday-Thursday to corporate and work social events before transitioning to cater to groups of friends and family over weekends. Experiential leisure offers an inclusive solution for corporate events, shifting activities away from alcohol to inclusive interaction.
2. F&B Trends moving the goal posts
The growth of the experiential leisure sector has also come at a time simultaneous to changing preferences in the way people choose to eat. While the restaurant sector has seen diners make a considerable return post-pandemic, a survey conducted by The NPD Group found that Gen Z (born 1990 – early 2000’s) as a collective dines out considerably less than previous generations. This trend has persisted throughout the cost-of-living crisis and is indicative of evolving consumer habits particularly within younger consumer groups and is typified by the proliferation of casual dining and growth in the grab and go sector.
Many casual dining and grab and go brands are now partnering with experiential leisure operators, allowing them direct access to their primary customer groups. Experiential leisure venues have successfully captured and benefited from the wider shifts in retail, with casual dining F&B offerings playing a significant role in attracting interest and broadening the appeal of their locations.
Co-founders of Swingers Crazy golf, Matt Grech-Smith and Jeremy Simmonds, both frequently cite their partnership with Patty&Bun, and Pizza Pilgrims, as key contributors to the success of the brand over its early years.
Furthermore, growing consumer focus on wellbeing has also benefitted the sector, with many consumers now looking to accommodate patrons that are no longer drinking or are drinking less during the week. Whilst that may have seemed a challenge for most companies 10 years ago, the experiential leisure sector has been able to offer inclusive entertainment options where alcohol now plays a much lesser part of the overall experience, and within an environment where lost wet sales can be made up by pay to play and admissions or grab and go, small plates or shared dining options.
The relationship between casual dining and experiential leisure venues is mutually beneficial, as it allows emerging challenger operators to access smaller spaces often on flexible terms, without the need for significant investment into a hard standing premises from the outset. It is also perhaps a differentiating factor when comparing and contrasting the experiential sub sector to its food & beverage and leisure peers.
3. The broadening and blurring role of the city
In a post- pandemic world, the way in which we allocate our recreational time has become more important than ever. As outlined through our My City Reports, the role of urban centres is evolving to include both a wider but more integrated use of the space within our cities. As such a re-alignment and gradual adjustment in the purpose and use of cities is likely to continue driving growth for experiential leisure, and see our cities continue towards the Playgrounds of Tomorrow. It is our fundamental belief that the evolution of societies and our cities is likely to support future demand for experiential leisure.
Related findings from the My City vision:
1.The West End will become a 21st century city playground, this is supported by a greater focus on serendipitous encounters, growth in cultural experiences, and an evolution of the West Ends offering.
2.The City of London will remain the UK’s largest office market – this will continue to drive demand throughout the week for alternative and varied social entertainment, serving as a key reason for office communities to return to the office.
3.Manchester will further strengthen its profile as a global tourist destination on par with Milan, Berlin, Boston and Frankfurt, attracting international visitors throughout the year with a broad offering of culturally enriched experiences.
4.Redevelopment of Edinburgh’s St James quarter will continue to enhance the focus and provision of quality retail and leisure activities in the city, helping to maintain the cities thriving tourism industry and complimenting existing heritage sites and cultural landmarks.
The role of the city, and people’s interaction with its amenities including retail and leisure has already changed. Analysing the distribution of retail visits throughout the week shows consumers have already re-aligned their retail visits to mirror the structural shifts and lifestyle changes that were accelerated by the pandemic. Retail visits are now spread more evenly throughout the week than had been seen in the years prior to the pandemic. Across prime retail destinations this has resulted in a greater share of retail visits now occurring through Monday-Wednesday, and a lesser share attributable to the days following.
Although not to the same extent this trend is mirrored by the nighttime economy, which has also seen the distribution of visits broaden. For the general retail market this poses significant questions around retail strategy, such as how do I convert coincidental low dwell time footfall early in the working week into spend. However, for experiential leisure operators, this serves as a benefit to the sector with general consumers and high densities of office workers much more likely to seek out and partake in diversified social activities earlier in the week, whilst benefitting from additional demand from families and close friends looking for venues over the weekend.
4. The Leisure market has presented significant opportunity
It was widely anticipated that the hospitality and leisure sectors would be buoyed by the re-opening post-pandemic, and that the easing of Covid-19 measures would release significant pent-up demand and ignite a renewed interest in the sector. However, this hasn’t been the case, with the hospitality sector impacted heavily by both inflation and rising costs, but also by the ensuing policy response of a sharp tightening of monetary policy which has held sales and spend flat. These recent pressures have added to the previous troubles that were observed prior to the pandemic, which saw a number of major restaurant chains become insolvent. As a result, the leisure and hospitality market has been significantly disrupted in recent years, with a notable erosion of the middle market resulting in a bifurcation within the market.
However, such disruption has presented a significant opportunity for the experiential leisure market and to date a significant effort has been made by operators to capitalise and capture spend that previously would have been associated with the now waning middle market. Investors have also caught wind of this opportunity, with investment into the experiential leisure market increasing markedly post pandemic.
According to data from Pitch Book, from 2018-2019 circa £64m was invested into the UK Experiential leisure sector 90% of which originated from venture capital. During 2022 and 2023 total investment into the UK more than doubled with total investment amounting to over £225m, gaining significant interest from the private equity market which accounted for a 71% share.
The evolving appetite for investment into the experiential leisure sector evidence and signals the evolution of the sector, with the sector now appealing to a broader pool of investors driven by conviction around the size of opportunity and strong fundamentals of the sectors key operators.
5. Real Estate has presented significant opportunity
The structural shifts undergone by the retail sector have been well captured in recent years. Retail has experienced a structural outward movement in vacancy levels, owed to aggressive cost-saving rationalisation programmes in the face of tough trading conditions, and the failure of some major retail operators, notably the “middle ground”. As a result, landlords have had to focus efforts on stabilising and maximising existing income, in the process looking to re-purpose and re-position voids left by former occupiers. The structural increase in levels of supply as a result of these large and persistent voids, has softened rent levels across all markets. Resulting in the continued re-basing of rent levels, and a focus on ensuring schemes can continue to offer the aggregation, adjacency and synergy benefits derived from healthy occupancy levels.
For experiential leisure operators requiring large spaces and non-typical retail areas, the challenges faced by other sub sectors have aided its growth. Following the loss of a number of significant department stores, the sector has benefitted from space left behind by the middle ground dining sector (Jamies Italian, Prezzo, Strada, Richoux, Cafe Rouge, Byron), the Nightclub industry, and the loss of a number of World Buffet concepts that has allowed the sector to access larger retail sites in prime locations. This combination has meant for experiential leisure operators, that the opportunity to acquire and secure space within good retail locations has been easier than in previous cycles. The operators ability to pivot, adapt, and innovate has also served it well allowing operators to take on larger retail spaces and offer a genuinely differentiated set up, stabilising income for landlords and providing aggregation, adjacency and synergy benefits with it.
Outlook
Inclusive experience as the key pillar of retail strategy
Matthew Ashman
Head of London Leisure
& Restaurants
Retail
Edward Bavister
Head of Retail & Leisure
Research, UK
Get in touch to discuss this analysis in detail with our expert C&W team.
CONTACT US
Segmenting the market, with a focus on experience types enables assessment of tenant mix, and the multitude of retail and leisure options available to landlords. Each of the sectors within our Experience Matrix have been designed to enable gap analysis against demographic catchments and mosaic segment groups in order to identify areas of best fit for schemes, and strategically unlock opportunities for landlords and occupiers. The individual components of the experiential leisure sector and both the wider experience matrix have different characteristics; be it their operating models, real estate requirements, strategic focuses, or business risk. Below, we expand on the experience matrix and its four component parts to define and differentiate the experiential leisure sub-sector and the operator types that form experiential leisure. This segmentation is based on prime businesses within the sector their operating models, real estate requirements, and strategic focuses and risk.
BROAD LEISURE FRAMEWORK
UNDERSTANDING THE WIDER EXPERIENCE SPECTRUM & ITS TRANSMISSION THROUGH REAL ESTATE
Cushman & Wakefield Experiential Leisure Segments
SEGMENTING THE EXPERIENTIAL LEISURE SECTOR BY REAL ESTATE CHARACTERISTICS & REQUIREMENTS
PLAYGROUNDS OF TOMORROW
PLAYGROUNDS OF TOMORROW
In a retail market typified by tough macro-economic conditions, behavioural scarring, the hangover from the pandemic, and digital transformation, unpicking both retail but more specifically the leisure sector is a growing challenge. The experiential leisure sector forms part of the wider experience matrix, which our UK Retail & Leisure team has devised in response to having seen retail strategy rapidly pivot to place greater focus on customer experience in recent years.
Strategic segmentation of key sectors, their components and characteristics is critical in understanding the composition and health of the market. We have created a simplified matrix of broad experience categories, of which experiential leisure forms the majority of operator types and when combined with experiential retail create the wider Experience Matrix.
SOCIAL ENTERTAINMENT
LARGELY COMPETITIVE SOCIALISING UNDERPINNED BY f&b
immersive entertainment
experiential leisure ip/vr/gaming/esports
gamechanger
Doesn't easily fit in to the above, as it represents a new experience, pushing boundaries
DEFINTION
Modern Classics - classic experiential leisure concepts, mini golf, bowling, darts, modernisation of traditional pub classics
mixed-use blended - Facilities containing multiple game types and uses
DEFINTION
Active leisure - simulation of major sports, branded content and digital infusion
DEFINTION
IMMERSIVE ENTERTAINMENT ESCAPISM OR SIMULATED EXPERIENCE, USING BRANDED INTELLECTUAL PROPERTY AND THEMATIC SIMULATION SUCH AS VR, OR ROOM SETTINGS
ACTIVE LEISURE
Participation, learning, e.g climbing, five-aside, padel tennis, ski, surfing
DEFINTION
GAME CHANGER
NEW INNOVATIVE CONCEPTS NOT BROADLY WITHIN OTHER CATEGORIES, OFTEN INCLUDES THEATRE LIVE PERFORMANCES
edutainment
Learning, teaching and family
Culture / arts / creative
e.g gallery, museum arts/theatre, music/events venue, creative HUBS STUDIOS
Active leisure
Participation, learning, e.g climbing, five-a-side, padel tennis, ski, surfing
RETAIL MANUFACTURING
WORKSHOPS AND HANDS-ON RETAIL, CREATING UNIQUE PRODUCTS & EXPERIENCE
SOCIAL ENTERTAINMENT
LARGELY COMPETITIVE SOCIALISING UNDERPINNED BY F&B
IMMERSIVE ENTERTAINMENT
EXPERIENTIAL LEISURE IP/VR/GAMING/ESPORTS
GAMECHANGER
DOESN'T EASILY FIT WITH THE OTHERS, AS IT REPRESENTS A NEW EXPERIENCE PUSHING BOUNDARIES
LEISURE
Key
Takeaways
KEY TAKEAWAYS
Over 1.6m sq ft of prime experiential leisure exists within Central London and the Big 6 regional cities. Accounting for close to 60% of the sector's national footprint.
Both structural and cyclical factors are likely to maintain the sectors momentum, and the sector is likely to play a key role in how our cities and retail landscapes evolve.
Despite the market growing rapidly in recent years, significant opportunity exists for further growth with a number of regional cities under-supplied relative to their potential demand profiles.
The experiential leisure sector not only offers an asset management solution to large and persistent voids but also provides complementary footfall through the halo and gravity affect and has the possibility to pay good levels of rent for best-in-class locations.
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The global leisure market has grown, and more importantly evolved, dramatically over the last 3 years, particularly post Covid with a plethora of retail units being repurposed. Some landlords have made quick, perhaps even knee jerk decisions, as to which leisure operators they work with. With new intellectual property surfacing every week and the latest “bouncy castle” concept being announced, finding our way through the opportunities to identify the right options for specific assets is a large task requiring patience, expertise, and lateral thinking.
Whilst the experiential leisure sub sector can straddle multiple categories across our Experience Matrix, the bulk of the existing market and momentum surrounding the sub sector is primarily attributable to the social and immersive entertainment sectors which to date accounts for 56% of the sectors prime real estate footprint. However, in recent years there has been significant growth in the active leisure and gamechanger categories, marking an evolution of the sector, which we believe is likely to persist.
To allow our research to be specific and granular, the social entertainment sub-sector is further segmented into two distinct occupier and operator groups offering social lead experiential leisure within this space. The differentiating factor between them is principally that; modern classics typically focus on the offer of a single activity type, whilst mixed-use blended operators specialise in the offer of large mixed use multi-station gaming areas offering a variety of activities. As such the real estate requirements and operating models differ between the two sub-sectors.
Across the experiential leisure spectrum, business operations vary significantly from operator to operator. For some operators the primary focus is the curation of stimulating ‘Instagramable’ spaces simultaneous to the complementary provision of free or low-cost social activities within the context of a premium F&B offer. In other cases, operators may focus on the delivery of novel high-tech activities with a pay to play fee either charged by player or as a hire fee for a private gaming area.
Experiential leisure footprint by city
London as the experience leader, and game changer leader
London is often assumed to be the leading destination for experiential leisure, owed to its physical market size, large catchment, large tourism market and high density of office workers. We estimate the footprint of prime experiential leisure extends to just over 750,000 sq ft, of which over 400,000 sq ft is comprised of mixed-use concepts and active leisure. To date, circa 60% of space operated by game changing concepts nationally is situated within London. This is owed to the rapidly changing footprint of the city which provided a wide range of suitable supply for operators, simultaneously twinned with a trend driven catchment and high exposure to target demographics and age groups.
Share of prime retail footfall by day of the week
Retail vacancy rate by sector and store closures
What is the value of experiential leisure?
Experiential leisure and its emergence as an occupier of prime real estate brings with it questions surrounding its value. In previous market phases the sector has been viewed primarily as a solution to awkward spaces and voids. In this section we begin to identify and quantify the benefits brought by the sector, and how the sector plays a complementary role within the wider retail setting as well as the financial performance of the sector. We have identified two key affects, the Halo affect and the Gravity affect, both of which highlight the sectors ability to bring adjacency benefits and offer the ability to strategically differentiate the offering of retail and leisure locations.
Halo & Gravity Affect
The Halo Affect: Relates to the sectors ability to provide complementary footfall for surrounding occupiers. Examples of the halo affect within broader retail typically relate to key anchor tenants and their ability to enhance the draw of retail schemes.
The Gravity Affect: Relates to the sectors ability to attract a wider pool of consumers to each location, as a result of providing a varied offer, and broadening the footfall catchment for locations.
Experiential leisure uses act as a contributing draw factor for retail schemes, deriving both complementary and non-local footfall for surrounding occupiers and aiding performance of locations. Simultaneously strong experiential operators also effectively broaden the catchment demographic and diversify the demographic catchment of retail locations. The charts below compare the distribution of footfalls for a small sample of locations with high exposure to experiential to the footfall performance of the prime retail market.
The data within the experiential leisure sample is based on three submarkets where substantial clustering of experiential leisure offerings now exist, and where major experiential leisure operators have opened premises since 2018. The chart shows how the distribution of footfalls to these locations has evolved over the 5-year period.
The data captures the sectors ability to broaden footfalls and that the addition and opening of experiential leisure has allowed locations to diversify and secure weekend footfalls.Furthermore, for retail clusters with a high density of experiential leisure footfall between 6pm – 12pm accounts for a greater share of total footfall than when compared to prime best in class high street locations. Supporting the view that experiential leisure provides complimentary footfall to existing retail destinations throughout the day.
BROAD
LEISURE FRAMEWORK
Where are the opportunities for future growth?
Unpicking an increasingly complex market remains a challenge for many in the sector. As with any growth concept it is easy for the market to overstate the level of opportunity and exaggerate potential future growth of the market. To assess future growth for the sector, we have undertaken a comprehensive review of the sectors major operators across the United Kingdom, focussing on London and the Big 6 major cities.
Assessing the current prime experiential leisure footprint of each city relative to a basket of potential demand indicators such as target age groups, target mosaic segments, related spend, and tourism levels allows us to assess the current penetration of experiential leisure within the context of each markets potential demand and appetite for experiential leisure in each city.
Presenting the data in this format shows us that London, Birmingham, and Manchester have the highest levels of experiential leisure relative to their demand profile. Whilst markets such as Glasgow, Edinburgh and Leeds appear to be under-served relative to their potential demand levels.
We continue this analysis to express this relationship as a ratio. In the chart a ratio of 1 represents a market in which the current provision is proportionate to potential demand, a ratio in excess of 1 represents a market where the current footprint of the sector is smaller than indicated by the potential demand profile.
Applying a variable weighting to the components of the demand score allows us to identify opportunities across the experiential leisure market. The weightings are geared towards target age and demographic along with an increased gearing towards tourism. This is particularly relevant in markets such as Edinburgh, Manchester and London where tourism accounts for over 30% of total retail catchment.
Furthermore, by breaking down these footprints more forensically in tandem with the Cushman and Wakefield market segments and operator types, greater areas of opportunity become clear. Across major cities some market segments remain notably under-served and, in some places, have no offer.
Each of the sub sectors within our experiential leisure framework have both different real estate implications but also operational and strategic implications. Understanding the strength of each sub sector, and its operations also unlocks opportunity.
Where markets currently have high exposure to experiential leisure, it is likely that future growth will originate from cyclical trends within the sector, by which concepts become outdated and see location performance fall, and in time are replaced with new concepts. Examples of this already exist within London for example in Camden where the existing I’m a Celebrity Get Me out of Here themed venue, is being re-purposed to provide a new Tomb Raider experience.
City exposure by experiential leisure sector
Demand Profile by City vs. Sector Footprint
market ratios relative to weighted basket of demand indicators.
EXPERIENTIAL & rETAIL Distribution of footfalls by day of week
Experiential share of Footfall by daypart
It is often assumed the experiential leisure sector is not a strong contributor to income performance of retail assets, and that the sector under-rents relative to peers. As part of this exercise, we were able to collate and analyse 77 leasing comparables from the sector across a variety of major retail schemes to assess the financial performance of the sector.
To date the modern classics sector are able to pay the highest level of rent largely as the operators within this space have been able to effectively mature and improve profitability unlocking the ability to secure prime real estate pitches at higher rents. The active leisure sector pays the lowest level of rent; however, the sector has a markedly higher average unit size than its sub-sector peers and as such benefits from economies of scale. Meaning a comparisson to prime retail rents may be a poor barometer for gauging the financial performance of the sector.
Our findings predominantly show that there is significant variance across the sector between operators and locations and the headline rent levels recorded. However, we also found that a significant proportion of deals include a turn-over top-up/clause.
From a covenant perspective, there is no significant impact on leasing agreements.
With evidence suggesting experiential operators acquire space with typical retail terms, and agreements. Generally speaking, capital contributions for the sector are slightly higher than comparable uses, but major operators with strong performance are able to provide significant turnover top ups, enhancing the value to landlords.
In order to asses the impact of turnover rents within the sector, we collated trading performance data for 6 major operators within the space. Assessing total revenues relative to their real estate footprint we were able to estimate both the sales densities for each operator, as well as an average turnover rent for each of the operators.
Major operator revenue performance & turnover top up implications
Understanding Financial Performance
Will the sector become a key occupier of prime real estate?
Where are the risks within the experiential sector?
Is the opportunity for operators dwindling?
The emergence of the sector has been accelerated by external factors such as the Covid-19 pandemic, whilst benefitting from suitable market conditions as a result of both structural and cyclical factors. Although the sector remains a relative newcomer to the prime real estate world, major players have now been successfully in operation for a number of years. As data around the sector improves, and operators are able to fully leverage their scale, attitudes towards the sector will likely change.
Continued success for key experiential leisure operators will improve the sector's perception, whilst new concepts and IP are likely to maintain the sector's role as the forbearer of leisure innovation. This will be twinned by growing investor interest that will allow concepts to scale, with likely significant M&A activity resulting in some key market leaders.
Longer term trends in consumer preference and spending habits, as laid out earlier in this report, are likely to support further growth in the sector going forward. The rapidly evolving nature of both retail and more broadly our cities is likely to require a greater blending and intertwining of retail uses, including inclusive leisure options such as experiential leisure.
Although initial green shoots of rental growth have been recorded within some prime retail markets, many markets continue to undergo the process of gradually rightsizing retail footprints. The robust performance and resilience of the occupational market throughout 2023 has seen vacancy rates reduce across prime retail real estate reduce, limiting the supply of available units for the sector. As such, competitive tension within the market is rising, and opportunities to acquire tenant friendly deals has diminished. However, the continued adjustment seen within retail particularly in regional towns and cities is likely to present a steady conveyor belt of opportunities resulting from structural change in coming years. Surplus retail space on upper and lower floors is likely to continue coming to market as retail requirements evolve, and some sectors such as retail banking the cinema sector and night clubs continue to undergo structural change and right-sizing.
Is the opportunity for operators dwindling?
As the sector continues to approach maturity, it’s likely that sector leaders will continue to emerge. These leaders will be able to effectively leverage economies of scale in order to reduce operating costs at each site and increase profit margins within the business. For the largest operators the ability to leverage modular concepts and enact expansion through the franchise model is likely to drive competitive advantage and unlock opportunities to enter prime retail real estate. Early evidence of operators paying prime rent levels and securing prime real estate pitches is beginning to emerge and is likely to continue as the market matures.
Will the sector become a key occupier of prime real estate?
Some risk exists for the modern classic sector, which have past their novel stage, with a risk that these concepts will rotate out of favour with consumers. As such, and similar to what the market has seen for other retailers, significant investment into the development of new concepts and technologies will be required in order to remain relevant. Likely losers will be determined by those unable to further innovate and enhance their experience offering. Mixed use and blended operators are likely to be more resistant to these risks due to their diversified offers.
Where are the risks within
the experiential leisure
sector?
Matthew Englender
Associate F&B & Leisure
Retail
City exposure by experiential leisure sector
FORWARD
WHAT IS EXPERIENTIAL LEISURE
THE EMERGENCE OF THE SECTOR
OPPORTUNITIES FOR FUTURE GROWTH
VALUE OF EXPERIENTIAL LEISURE
UNDERSTANDING FINANICAL PERFORMANCE
OUTLOOK
EXPERIENTIAL LEISURE
EXPERIENTIAL LEISURE
EXPERIENTIAL LEISURE
ALL PROPERTY
PRIME RETAIL F&B
Head of Retail & Leisure,
UK
Edward Bavister
Head of Retail & Leisure Research, UK
Structural
Cylical
Structural & Cylical
Matt Ashman, Head of Leisure and Restaurants, Cushman & Wakefield
case study:
Gravity Wandsworth
Landsec & Invesco
Gravity Active Entertainment have occupied the former 80,000 sq ft Debenhams site in Wandsworth following its closure and the demise of a number of department store chains. Whilst predominantly an active leisure concept the large experiential leisure format is one of the largest nationally blending a number of gaming areas for all ages and generates significant footfall for the Southside scheme in which it is located. Broadening the occupier mix to include a major experiential leisure operator has also benefitted surrounding leisure and F&B operators, joining a 14-screen cinema, and number of dining brands.
Gravity Wandsworth
The Nighttime industry association revealed the loss of 67 nightclubs during the first 3 months of 2024, an average of 5 closures of week many of which are independent.
HOW BIG IS THE EXPERIENTAL LEISURE
The current prime experiential leisure market accounts
for circa 2.765m sq ft of space within the United Kingdom.
Of this, almost 1.6m sq ft is located within the big 6 major cities and London.
The market has over 100 different major operators, with new concepts and intellectual property being bought to the market rapidly.
MARKET IN UNITED KINGDOM
IRELAND
Belfast
Galway
Dublin
Kilkee
Cork
Southend-on-Sea
Brighton
Eastbourne
Portsmouth
Bournemouth
Stoke-on-Trent
Hull
NORTHERN IRELAND
UNITED KINGDOM
WALES
Wolverhampton
Coventry
Peterborough
Cambridge
Preston
Leeds
Newcastle Upon Tyne
Sheffield
Manchester
Liverpool
Nottingham
Leicester
Bristol
Swindon
Oxford
Reading
London
London
Southampton
Norwich
Birmingham
Douglas
Dom Bouvet
Onlookers often assume that the Experiential Leisure sector has benefitted from access to real estate at a relative discount through the opportunity presented by the structural shifts in real estate requirements. However, its important to consider alternative uses and the changing nature of retail destinations when assessing financial performance. We are already seeing a number of operators enter the prime retail world, and with their entrance paying strong levels of rent.
Mathew Englender: Associate F&B & Leisure
Retail
IRELAND
Belfast
Galway
Dublin
Kilkee
Cork
Southend-on-Sea
Brighton
Eastbourne
Portsmouth
Bournemouth
Stoke-on-Trent
Hull
NORTHERN IRELAND
UNITED KINGDOM
WALES
Wolverhampton
Coventry
Peterborough
Cambridge
Preston
Leeds
Newcastle Upon Tyne
Sheffield
Manchester
Liverpool
Nottingham
Leicester
Bristol
Swindon
Oxford
Reading
London
London
Southampton
Norwich
Birmingham
Edinburgh
Glasgow
Ipswich
Colchester
Swansea
SCOTLAND