Back in the day when house was acid and raves were massive, clubbing was the North West’s premier growth industry. The Haçienda in Manchester and Cream in Liverpool were mega-venues with global appeal, and everyone was waving their hands in the air like they just didn’t care. If you weren’t off your face, you weren’t really paying attention.
Today, less so. It is years since the Haçienda was transformed from topsy-turvy nightspot into respectable city-living apartments. Now Cream – 21 years young and still operating from its original factory and adjoining Nissen hut – is about to go, too.
However, it may not be going far. Liverpool developer Elliot Group is on the brink of submitting a planning application for a £40m redevelopment of its Wolstenholme Square site, which will provide a new 21,000 sq ft home for Cream along with 11,840 sq ft of restaurants, leisure and more than 340 flats. Another music venue at Wolstenholme Square, the 400-capacity Kazimier, will close in January 2016 after seven years in the former Continental club.
The moves come as the North West club scene struggles to redefine itself. The last 15 years have not been good for clubs. With a few exceptions, young people are generally more sober and less obviously off their faces, which changes the dynamic dramatically. Young punters also have a wider choice of venues since the Licensing Act 2003 deregulated late-night bars .
A cool DJ and cocktails served until 4am is their kind of scene. The superclubs of their parents’ era – vast, sweaty stews of beer, hormones and disappointment – do not make their hearts race. The result is that demand for club floorspace is limited, and supply erratic, or in the wrong place, or overpriced, or perhaps all three.
Unrealistic expectations
Colin Siebert, director in the Liverpool office of Colliers International, has just relet the 5,000 sq ft Fudge premises at Wood Street. Lapdancing operator X in the City will replace the venue, which had run into some licensing issues. The rent is £80,000 a year.
He explains: “The economics of clubs mean they are trading three or four nights a week. It’s not like a seven-day-a-week bar operation, so you need lots of people through the doors quickly. So this venue was too small for the big club operators.”
There were plenty of enquiries for the Fudge space “but mostly from people with no real track record”, says Siebert. On the supply side, some landlords entertain unrealistic rental expectations dating back to the days when to run a big North West club was to own a licence to print money. In Liverpool £5-£10 per sq ft might be reasonable for an empty shell, say surveyors, perhaps more if there’s a decent fit out. Yet some landlords won’t start talking much below £20 per sq ft. “It just doesn’t add up for the operators,” says Siebert.
Some bigger club operators are thriving. Luminar – now renamed Deltic Group – fell into administration in 2011 under pressure from banking covenants. That year it recorded losses of £198m. But today it is back, with pre-tax profits of £3.7m and an £8.5m programme of investment in its club premises.
Sophie Attwood, rating specialist at Dunlop Heywood, looks after the Deltic clubs in Preston and Oldham, as well as 56 other Deltic venues nationwide.
“Nobody is looking for large venues anymore,” she says. “North West operators are closing floors in the larger buildings as they don’t want places to look empty, and it is changes to the bar circuit that have affected them.
“Oversupply in the nightclub sector is a long-term problem,” she adds. Rating appeals are inevitable in these circumstances.
Dan Davies, director of leisure agency at Manchester-based Metis Real Estate, says: “The glory days of the huge clubs are long gone. Today it’s about innovative operators, fleet-of-foot guys, often promoters of specialist nights, who are opening the new venues.”
What they want is a clubby feel in a bar-sized space of 5,000-8,000 sq ft. Bar chains like Bounce and Ping offer ping-pong tables, not heaving dancefloors, and these days the boys and girls want a Manhattan or a Mojito, not a can of gassy lager.
The cultural shift has property consequences. This kind of late-night entertainment needs the smaller, focused, well-located units preferred by bar and restaurant operators, not the basements and converted warehouses of old.
And competition for those units – especially in cities like Manchester – is fierce.
Is this a problem? Maybe not. Sip a mojito, play a bit of ping-pong, look cool with your mates: it isn’t such a bad way to spend an evening, is it? Their parents might just be jealous.
Property folk say yes to cocktails, no to clubs
Sophie Magee is a senior surveyor in the student and residential team at DTZ. She prefers her nights out in West Didsbury, on the outskirts of Manchester.
“It’s a good young professional scene,” she says. If she goes into the city centre, it’s to Mojo Bar, Bridge Street.
“A lot of people in the property scene end up there, whether they like it or not. It’s a good laugh but a bit dingy,” says Magee.
Investment team colleague Jonathan Brown can also be found at Mojo and The Liars Club, a cocktail bar a stone’s throw away.
He also frequents Cane & Grain in the city’s Northern Quarter. “It’s got a kind of Shoreditch feel,” he says.
“But my favourite is The Liquor Store, a cocktail bar on Blackfriars Street in Maybrook House. As it happens, our team recently tried to buy the building from clients of GVA for about £16m.”
