Rising consumer spend will fuel further growth in the UK’s leisure sector, according to the latest research published by the leading global real estate fund manager M&G Real Estate.
As household spend continues to rise and recreation facilities feel the positive knock-on effect, so too does institutional investor appetite to acquire property in the alternative asset class. ‘M&G Real Estate: Opportunities in the UK leisure sector’ highlights why institutional investors, looking for diversification, should invest in the leisure sector.
Recent ONS data outlines that the leisure industry has doubled in size in the past five years, reaching a turnover of £176bn. Going forward, the macro-economic picture remains positive and the UK economy is expected to grow by 2.6 per cent in 2015, underpinned by a 3 per cent uplift in household consumption. These conditions and the associated consumer confidence suggest continued growth in the leisure sector.
This positive picture of health for the industry, paired with low government bond yields and falling yields on mainstream UK property, are driving interest in leisure as a choice avenue for investing in non-traditional real estate.
Richard Gwilliam, Head of Research at M&G Real Estate explains: “Leisure benefits from drawing custom from a diverse customer base that includes tourists and UK residents. This gives it a far more balanced trading model compared with many other property sectors and, with the current levels of consumer confidence and low interest rates dissuading the public from just stashing their savings in the bank, we are seeing increased spend on recreation and culture. Leisure is therefore a potentially very lucrative investment opportunity at this time.
“The leisure sector is closely correlated with the health of the overall economy; while economic conditions improve, so too should the leisure industry.”
