David Lloyd health and fitness club in Bury St Edmunds, Suffolk, has been bought by abrdn on behalf of a segregated client, for an undisclosed sum, in a sale and leaseback agreement, which sees David Lloyd Leisure Limited agree a new 30-year lease term. International real estate advisor Savills acted for abrdn, and Portland Leisure Advisers acted for the vendor.
David Lloyd Bury St Edmunds, which is due to open in December 2024, has a site area of approximately five acres (two hectares) and a gross internal floor area of c.64,045 sq ft. It benefits from a dedicated car park and state-of-the-art facilities, including padel tennis courts, and indoor and outdoor swimming pools and spa. Situated in West Suffolk, the health club has access to a substantial catchment population in excess of 150,000 within a 20-minute drive.
David Lloyd has enjoyed a strong performance in the UK and Europe. As of August 2024, the Group had 773,000 members – a record number and a 4.2% increase on 2023 – and annual revenue topped £756 million, up from £655 million 12 months prior. 2024 is set to be another buoyant year for business, with membership growth, revenue and profitability all currently exceeding expectations.
George Trimmer, Associate in Savills investment team, says: “The UK health and fitness market is continuing to thrive; it’s reported to be valued at approximately £5bn and David Lloyd is the leading operator within this sector. This defensive, long-income product is unique particularly with its 30-year lease let to David Lloyd Leisure Limited and annual indexation. The latest David Lloyd results are exceptional, and we expect Bury St Edmunds to surpass its trading predictions and follow in a similar light. The sector’s resilience is being driven by increasing health consciousness and the adoption of wellness-oriented lifestyles which firmly cements this asset as a desirable alternative long-term investment.”
Stuart Caswell, New Clubs Acquisitions Director at David Lloyd Clubs, adds: “We’re thrilled to complete the forward commitment of our new club in Bury St Edmunds, which opens next month. Positioned in Marham Park, the club represents a fantastic addition to our portfolio, ideally placed to serve a growing community with high demand for premium health and wellness facilities. We look forward to welcoming our new members and continuing our strong momentum into 2025.”
Mark Sheehan, Director at Portland Leisure Advisers, adds: “We’re delighted to have completed this forward commitment transaction on behalf of David Lloyd. The club exemplifies the resilience and attractiveness of high-quality, long-income investments within the health and fitness sector. Investors continue to show great interest in these assets, which offer both stability and growth in today’s market.”