Krishana Singh - Negotiator

The health and fitness industry was the star performer in the leisure sector during 2009, with the fitness index reporting resilient performance in what was, for most, a tough year. 
 
There was growth in both supply and demand; like for like membership increased by 0.8% with 114 new openings and 119,000 new members. In the midst of a recession, this robust performance underpins the simple fact that exercise is perceived by consumers to be a vital part of their lives and not just a luxury expenditure. It's amazing to think that footfall officially increased in the middle of a recession!!
 
New entrants have appeared in the form of budget, ‘no frills’ gym operators, who have taken advantage of the price conscious consumer looking for value in the market. Operators such as Pure Gym, fitness4less and Gym Group have emerged offering a low cost monthly membership, typically between £10 – £20 per month, seeking to exploit the differential between the users of private gym membership and the higher percentage of users of ‘pay to use’ public facilities.
 
Membership prices at such operations are low, achieved by concentrating on the core facilities such as the aerobic equipment and free weights, which are traditionally popular with gym users. However, they usually do not provide swimming pools, saunas and steam rooms, which are expensive to operate and occupy much space. This type of concept is suited to those more dedicated to fitness than those seeking enjoyment from leisure experiences. Many are open 24 hours a day, targeting those wishing to workout outside of the usual opening hours such as shift workers. User levels after 10pm are reported to be unexpectedly high.

One of the key factors to the low cost concept is the ability to attract members who don't traditionally use gyms and where price is clearly a major barrier. There are extensive examples of the model in America and throughout Europe, but until recently, no operator focusing on a value driven offer had entered the UK market. We are confident that the value offer will appeal to a consumer market where increasing pressure is being brought on luxury leisure expenditure.
 

Many are seeing the downturn as an opportunity and rather than thinking retrenchment, strong operators will be seeking sustainable expansion. With as many as three budget gym operators predicted to open in major cities across the country, coupled with the fact that 88% of the total population are not currently involved in the fitness industry, there appears to be room for continued growth. Subsequently, many of these budget gym operators have aggressive expansion plans in mind for 2010.
 
Do you have the right property for these operators?
 
KEY REQUIREMENTS:
* 15 - 20 year leases 
* 10,000 sq ft minimum trading space 
* Close proximity to  transport links 
* D2 planning use 
* 3.5m floor to ceiling height

Should you wish to discuss the sale or letting of your property that you believe may suit this, or any other leisure property please call Krishana Singh in the London office on 020 7280 4700.