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Yorkshire F&B supply outpaces north west

By Kasmira Jefford - Wednesday, October 04, 2017 12:55

Yorkshire and the Humber's leisure offer is growing at a faster rate than the north west with year-on-year supply increasing by 26% compared with 18%, Colliers research shows.

In addition, people in the region spend over 40% more of their disposable income on recreation than the UK average. Yet after a number of buoyant years, the food and beverage (F&B) market in the north of England has entered uncharted waters with much talk of oversupply in a range of locations.

Colliers' inaugural Northern Soul report states that while the F&B sector is showing evidence of oversupply with occupiers curtailing their requirements heralding a potential wider market slowdown. Popular locations in city centres and affluent suburbs, such as Leeds and Sheffield, enjoy the best prospects with the best locations continuing to prosper.

Cat Stevenson, Retail and Leisure Analyst at Colliers International commented: “Despite rising inflation squeezing household budgets and uncertainty following the vote to leave the EU, resilient consumers nationwide spent £1 in every £5 on leisure in 2016, accounting for £238bn or 20 per cent of all consumer spend and a 6.4 per cent increase on the previous year.

“This growth can be attributed to social change; increasingly tech-savvy consumers; ‘disruptor’ operators in the market and the rise of ever-demanding Millennials challenging the industry. The growth in popularity for competitive social activities, such as indoor crazy golf, darts, ping-pong and escape rooms, is fast becoming stiff competition for the traditional restaurant, bar and big box leisure industry. These new frontiers in the leisure sector are providing landlords with new options for underutilised space.”

Yorkshire and Humber is one of the fastest growing regions in the UK and its F&B market has flourished in recent years. There is already a bigger supply of operators and suitable units than the North West through a number of key developments.

Ben Dewhirst of Colliers International’s Leeds Licensed & Leisure division added: “Leeds is one of the fastest growing cities in the UK and its F&B market has blossomed at a similar rate. The City has continued to attract leading occupiers in new developments such as Victoria Gate and continues to entice significant interest when existing opportunities become available with current units attracting strong premium considerations.

“In Sheffield, 57 per cent of the leisure stock is made up of cafes and casual dining locations, the largest proportion out of all the northern cities we monitored. In addition, restaurant growth is currently surpassing bars (+14 per cent vs. + six per cent), with the largest increases occurring in local and independent style eateries (83 per cent), particularly around Eccleshall Road where rents are around £25-£27 psf and in the West Street, the most popular F&B area, where rents average around £20 psf.

“However, from a future perspective, we are advising landlords to take a very measured approach to their leisure and catering leasing strategy as a number of core operators pause to see what’s next for the sector.”

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