_Is the "Endgame" just the beginning for the UK leisure sector?

The weekend of the 25th April was a boon for the leisure industry; 'Avengers: Endgame' opened in the UK and globally, grabbing headlines and making box office history. The $1.2 billion generated from that weekend alone (already!) makes it the 18th highest grossing movie in cinema history.

Another $1 billion will make it the second highest grossing movie of all time - the first, as it currently stands, being James Cameron's sci-fi epic Avatar.

Cinema attendances in the UK reached their highest level since 1970 in 2018 at 177 million. Imagine what records 2019 will break with a steady pipeline of winners - Frozen 2, Toy Story 4 and the next installment of Star Wars - hitting the big screens later this year. 

There has been a lot of noise about the threat from film and television subscription providers Netflix, Prime and Disney+ etc relegating cinemas to the scrapheap of modernity, effectively gluing a new breed of media consumer to proverbial couches, surgically attached to their 60” plasma TVs and mobile phone screens. 

Year-on-year spend on leisure pursuits such as bowling is boosting the UK's leisure sector

Can I make a suggestion? If you haven’t been to the cinema recently, go - especially if it’s had the 'luxe' treatment. In a bid to stay relevant and competitive, all of the big multiplex operators are gradually raising the bar in most of their cinemas, offering differentiation points such as reclining seats, a proper F&B offer and a sound and vision experience that rubbishes that of a laptop, iPhone or home TV. 

I have only focused on one strand of the leisure sector here, but consumer spending stats, despite, or perhaps a result of Brexit woes, are very compelling and indicative of a thriving industry. In Q4 2018, year-on-year spend on eating out was up by 6%; 5% on drinking in pubs and 3% on good, wholesome fun - bowling. 

What might be going on? Perhaps the great British public have realised they have too much 'stuff', and have stopped buying clothes, electrical goods and other things they just don’t need; they have stopped going abroad in case their passport doesn’t get them home or the pound further crashes against the Euro, or that social interaction is key in the eternal quest for happiness and elusive wellbeing. After all, no other country 'goes out' with as much gusto as the Brits! ( just head down to a city centre on Saturday night near you to prove a case in point.)

What might this mean for the leisure investment sector? I will make a not so bold prediction for 2019. Leisure as an investment class will comfortably outperform retail, and investors will realise that the sector has genuine longevity.

Andrew heads up Knight Frank's retail and leisure team  with 10 years prior experience in the leisure investment sector. He has bought and sold over £1 billion leisure assets, including some of the largest ‘mixed-use’ schemes in the UK. Recent transactions include: Sale of The Gate, Newcastle-upon-Tyne for £60m Sale of The Light, Leeds for £91m Acquisition of 10 Odeon Cinemas for £80m Sale of Cineworld/Gala Casino, Cardiff for £19m.