There was a time when the health facilities installed in new build residential schemes were little more than a running machine and a few weights. Often tucked away in a small pokey basement room.
But then in new London residential schemes in particular, a ‘facilities arms race’ waged for more than a decade, starting in the early noughties. With the result being that today, the prospective buyer for any relatively high-end new build scheme, is likely to be bombarded with the promise of everything from a hydrotherapy spa to yoga and boxing classes.
But running alongside this have been big changes to the private health club sector. Less expensive operators have entered the market, with offers designed to lure twenty and thirty somethings who can’t or don’t want to pay the high prices charged by the ‘pay per month’ operators. They have driven a shift away from long-term membership, towards a pay as you go model. Allowing participants to access and pay for specific types of activity.
This market has grown so much in London in recent years, that in some sectors there are now an array of operators offering their own ‘branded take’ on a particular activity. Spinning being a good example, with the likes of Soul Cycle, Pscycl and Daylight Cycle, now all competing to attract the legs of keen cyclists.
So why now more than ever is all of this relevant to residential developers, considering the installation of such facilities in future schemes? To answer this a number of factors are worthy of consideration.
Firstly, in most higher end schemes investors still tend to account for the large majority of buyers, with purchase motivations that are poles apart from those who plan to own and occupy a property. For them in particular, service charges have become an increasingly significant issue, and if too high, a barrier to purchase. Simply put, they want to buy into a scheme that offers enough facilities to tempt a tenant, but not so extensive as to make the investment untenable.
This has become an increasingly sensitive balancing act for developers. Needing to strive ever harder to differentiate their offers in a crowded market, whilst not at the same time putting off their largest group of potential buyers.
So where does the balance lie? Well as always it depends. On factors ranging from size of scheme to price-point and location, but new combinations of brands and business models are emerging. One good example is the Soho House Gym at the re-developed Television Centre in London’s White City.
Here, whilst the facilities are more extensive than probably any other scheme in London (over 24,000 square feet), they are funded by number of sources in addition to residents of the scheme. Including Soho House members, Soho House Hotel guests and office workers in adjacent buildings.
The membership model also differs from traditional clubs, affording as it does, access to all of the installed facilities, but with all classes offered on a pay as you go basis.
Lastly, the recent growth in operators specializing in one type of class or discipline has driven up the importance of the brand. i.e. It’s not just where you spin, but who you spin with.
Ultimately, these factors taken together may well combine to realise a future, that at least in part, will be driven by increasing collaboration between developers and established brands operating in the health and fitness space. Probably by adopting business models that blend private, public and pay as you go access. Thus allowing developers to keep offering their buyers a quality of experience appropriate with a scheme’s price-point, but at the same time lowering fit out and ongoing operating costs. For the health and fitness brands it could be an attractive way to expand their presence, at lower cost and with access to ready installed customer bases.
So maybe everyone can be a winner, and as anyone knows, the world of fitness and sport always has its eyes on ‘the win’!