OPERATOR PERSPECTIVE
But we already had new sites in the pipeline. Coming out of COVID, we opened in Notting Hill Gate and then Nine Elms, and six months ago finally opened in Kings Cross. That project was hugely delayed by contractor and material availability, and of course prices have gone up so much too: Kings Cross has cost us double what we expected. If we hadn’t already had a contract for the site, we may not even have done it. I now believe that even where boutique brands have the appetite for growth, it’s now cost-prohibitive unless they have significant financial backing. I expect growth to be fairly subdued in this sector for the next few years. Certainly at Ten, even with our December 2022 refinancing, we won’t be looking to open any more new studios until probably late 2024. For now, it’s about consolidation, focusing on the controllables across our 11 studios and making sure the customer is front and centre of what we do. As an aside, at least judging by what comes across our desk, rents aren’t really much different from pre-COVID. There are deals to be done if a landlord believes you add value to a development, but a good area will always be a good area and landlords are looking to recoup some of the money they lost in the pandemic. Has the boutique consumer changed? There’s definitely a greater understanding of self-care, with people looking for things that improve both their physical and their mental health. Women’s health is also a big growth sector. Physiotherapy is part of our offering, allowing us to operate a pelvic health programme, while from a fitness perspective our clinical prescription team support women throughout treatment for breast and ovarian cancer. We also have menopause month coming up.
So many of these topics weren’t really spoken about before, but people now want to. They want to know how to look after themselves better for longer, and they seek out and engage with brands with relevant expertise – brands they can trust. I believe this is why, in spite of hybrid working, our customer usage patterns haven’t changed too dramatically. Reformer pilates is certainly having its moment right now, but crucially, we’ve been going for 16 years and have a reputation for deep expertise. We stick to our knitting, as they say – we know what we do and who we do it for – and people understand our brand. We have clients who’ve been with us since 2007. Our city-based locations were slower to come back than our more residential locations – Notting Hill Gate and Chiswick, for example – but we’re seeing month-on-month improvements and people are still buying memberships and packages and coming regularly. What’s next for London’s boutiques? We won’t see 2019-style growth for the foreseeable future, but I believe the sector should be confident, trusting in the value of what it delivers. There will be consolidation, similar to United Fitness Brands (UFB) bringing multiple boutique brands into its portfolio. This sort of scaling makes sense.
One of the biggest threats to the boutique sector is now gyms, which is ironic as when Ten started in 2007, we were the antidote to impersonal big boxes.
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LONDON BOUTIQUE STUDIO REPORT 2023
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