More UK sports venues could look to develop US-style ‘entertainment districts’ to drive revenue over the coming years.
That was the prediction of Gavin Makel, director of services & operations – entertainment district at Manchester City Football Club, speaking on a panel session as part of the UK Annual Hospitality Conference (AHC) on 1 October 2024 at the Manchester Central Convention Complex.
Driving destination footfall
“I think the trend you’ll start to see among most sports organisations is how can they use the land that’s around, not just the stadium but also the facilities they own, the training grounds etc,” he said.
Manchester City Football Club is investing in a £300 million expansion of its Etihad Stadium, which will include a 400-bedroom hotel, club shop, F&B units, office space and museum. Makel said the development was an attempt to “drive that area as a destination not just on a match day or [for] concert goers, but for 365 [days a year]”.
“It obviously creates another revenue stream for the football club, but it obviously also caters for the local community, growth in jobs and training,” he added. “I’m pretty sure that you’ll start to see more sports organisations go down this route in the coming years for sure.”
Balancing hotel supply and demand
Manchester’s two football clubs create “huge demand” for hotel rooms in the city, said fellow panellist Matt Townley, group operations director at Dakota Hotels, which received the go-ahead for a 154-bedroom, £60m airport hotel in Manchester – its second hotel in the city – just last week.
“You’re seeing fans come over not just for the football – they’re staying one, two and three nights – so you’re seeing big impact midweek and certainly at the weekend as well,” he said.
However, Townley, who is also chair of the Manchester Hoteliers Association, highlighted the city’s circa 2,300-room pipeline as a potential challenge which the city Accommodation Business Improvement District (ABID) is seeking to tackle through a city visitor levy of £1 per night.
Manchester was the first city in the UK to launch a visitor levy last year, which has so far raised approximately £2.8 million. Townley said it is hoped to raise £18 million over five years.
“The ABID is a very forward-thinking mechanism to generate funds that will complement what Marketing Manchester, the DMO [Destination Management Organisation] are doing in the wider world internationally. If that supply continues at that rate, I think occupancy will take a hit over time,” he explained.
“That £18 million, we plunge back into the city to try and generate additional bed nights through subventing conferences and events.”
Wigan a top investment destination
And when it comes to investment, Greater Manchester’s night time economy adviser spotlighted Wigan as the area’s top investment destination. “If I were to invest anywhere in Greater Manchester at the moment, it would be Wigan,” said Sacha Lord.
“Wigan is going to have a fantastic few years ahead of them. They’ve really understood the importance of the night time economy.”
Lord added that the biggest change for the city of Manchester overall had been the opening of the Co-op Live arena. Despite delays, event cancellations and construction issues, the arena opened earlier this year, a £365 million, 23,500-capacity arena with 32 bars, restaurants and lounges. When speaking at the AHC last year, Lord said it would be “the best arena in the whole of Europe by a long, long way”.
Speaking at this year’s AHC, he said the knock-on effect – not just for Manchester’s hotels but bars, restaurants and pubs – had been “incredible”.
With around five food halls operating in Manchester, it is one of the top regional food hall destinations outside of London. And although London constitutes the largest proportion of the market supply of serviced apartments, Manchester follows in second place with a 6.3 per cent market share.