Landlords and developers of retail destinations are focusing on growing the proportion of leisure in their schemes to increase footfall and dwell time. The strong performance of cinemas means they remain a go-to anchor and, as Cushman & Wakefield data reveals, the sector is changing.
The British Film Institute reports UK box office sales in 2016 were £1.2bn, matching 2015’s figures and up around 17% on 2014. Admissions reached 168 million last year, slightly higher than the 10-year average of 167 million.
Cushman & Wakefield’s research shows that around 144 new cinemas are proposed over the next five years, totalling approximately 960 screens and 3.6m sq ft of new cinema space. “This would represent a growth of more than 30% in the total number of UK mainstream cinemas today – one of the most significant growth rates ever seen,” says Thomas Rose, head of leisure and restaurants at Cushman & Wakefield.
UK mainstream cinemas are experiencing of the most significant growth rates ever seen - Thomas Rose, Cushman & Wakefield
And it isn’t all about multiplexes. Rose notes increasing market segmentation between ‘multiplex’, ‘boutique’ and ‘neighbourhood’ venues, which he says is helping to redefine cinema development in the UK.
While 32% of proposed sites are earmarked for the ‘big three’ operators – Cineworld, Odeon and Vue – there is a newly expansive generation of ‘challenger’ brands such as The Light, Empire, Everyman, Savoy and a number of smaller independents pushing for growth.
Cushman & Wakefield’s data suggests around 20% of the new sites planned are for smaller, boutique or neighbourhood cinema operators.
When it comes to location, only 17% of the proposed sites are in traditional out-of-town locations. This is indicative of the localisation of cinema, which, although predominantly a London phenomenon, is now spreading across the UK.
However, Rose says oversaturation could occur in some markets, resulting in the repurposing of cinema sites. Investment in or the repositioning of existing sites will become increasingly important.
“We do not think online streaming services such as Netflix and Sean Parker’s Screening Room… will have a major impact on cinema in the immediate future,” he says. “However, operators do need to improve, adapt and invest to stay ahead of the internet generation.”