Healthy level of activity across the Leisure sector in the first half of 2021
Specialist business property adviser, Christie & Co, has today launched its mid-year review of the UK leisure market, reflecting on activity and trends in the first half of 2021, along with sharing an outlook for the rest of the year.
The review reveals that a strong return to trading for many leisure businesses has retained investor interest in the sector and driven a healthy level activity across the market, particularly amongst holiday park and visitor attraction operators.
A number of market trends were highlighted through Christie & Co’s transactional activity since January 2021, including the sale of iconic UK visitor attraction, Skegness Pier, in the same hands for nearly 45 years, to Mellors Group. The sale emphasised the huge interest in quality leisure assets which offer an opportunity for further investment or development, particularly those in coastal tourist locations, due to the current strength of the UK’s staycation market.
The review notes a surge in demand for outdoor leisure sites has persisted so far in 2021, in light of the third national lockdown and ongoing social distancing restrictions. Investors continued to favour opportunities that have increased capabilities to trade with less adverse impact when these measures are in place. This was demonstrated with the sale of Boothferry Golf Club, which attracted a high level of interest despite being conducted on a confidential basis.
The long income investment market also continues to be particularly active at present, with strong investor appetite specifically targeting the “alternatives” investment space with land opportunities. This was evidenced through the sale of the freehold, long-income investment of the National Horseracing College to the Hogarth family. Occupied under the residue of a 99-year lease from January 1996, the investment was sold off an asking price of £1,350,000, achieving a net initial yield of 3.5%.
Encouragingly, these transactions have all been at or above the asking prices, which is a reflection of the continuing supply and demand imbalance for quality operational leisure real estate.
Other trends identified in the review include a rise in the use of technology in many operators’ business models. Over the past twelve months Christie & Co’s Retail experts have seen many companies, who may not have previously considered ‘tech’ a fundamental part of their operating model, adapt to a digitally integrated, online booking platform with cash-free customer transactions.
The review also shines a light on the Health & Fitness market, which has emerged as a new winner that is set to experience a strong come-back due to the huge consumer demand for the return to gyms once lockdown restrictions began to ease on 12 April.
Jon Patrick, Managing Director of Leisure comments, “The first half of 2021 has been a busy period for the leisure sector. There has certainly been challenges for operators, who faced a third national lockdown and ongoing trading restrictions. However, this didn’t seem to slow down the transactional market, which is hugely encouraging and an indicator of the underlying strength of the UK leisure market for quality assets, particularly outdoor activities and attractions which have fared well when they have been able to trade since the onset of the pandemic and continue to attract investors to the sector. We look forward to watching the industry get back up and running now that we have passed ‘Freedom Day’ and are keen to announce more exciting activity in the coming months.”
To read the full ‘Leisure Mid-Year Review’, CLICK HERE.
For further information on this press release and interview requests, contact:
Bronte Hughes, Corporate Communications Executive
P: +44 (0) 7721 420 656 or E: bronte.hughes@christie.com
