E-karts are on their way to the old Debenham site in Liverpool. Credit: via Aver PR

The Subplot

The Subplot | Go-karting, THG loans, American money


  • Karting is fun: how a Liverpool deal shows competitive socialising is going to change town centre property.
  • Elevator pitch: your weekly rundown of who and what is going up, and who is heading the other way


Gravity lands with a thud

Liverpool has scooped what is probably the largest competitive socialising deal the UK has yet seen. Every high street can expect to join the party, but beware about getting too excited too soon.

Gravity Active Entertainment will operate a 100,000 sq ft leisure destination at the former Liverpool Debenhams. It’s a monster letting in a fast growing, but still unstable, sector. Gravity’s 15-year lease eats up the majority of the 185,000 sq ft former department store. The firm will spend £10m on conversion to make the space suitable for e-karting, bowling, urban golf, and of course plenty of profit-generating places to eat and drink. It must be a mighty relief for landlord Grosvenor.

Millions or more

Gravity likes big units – 30,000-80,000 sq ft, typically – but most operators chose smaller pitches. Even so, a few 8,000-15,000 sq ft deals in former retail or even office floorspace (think basements) soon adds up. Back of the envelope calculations suggest about 1.5 million sq ft of deals are in progress in the UK, with a solid 250,000 sq ft looking in this region, but it could be a lot more.

Let the fun begin

A bonanza of fun for city revellers, and landlords, alike? Maybe. A host of new concepts are coming, many of them gunning for serious sports enthusiasts (cricket and Formula 1), or fans of branded ideas (Harry Potter, for instance). These will be used as upselling or promotional tools. Other concepts will focus on the corporate trade, luring businesses to hire them out for away days and launch events. Manchester and Liverpool are high on corporate-focused operators’ target lists, though few so far have broken out of Central London. Many will be relatively small (4,000 sq ft to 8,000 sq ft) and increasingly picky about location.

Some lucky winners

Landlords with the right spaces at the right prices could do well. Laurie Stokes is a director at London boutique Nash Bond and is perhaps the best-connected name in competitive socialising agency. “These days, some operators can cut fairly competitive deals. Remember, some of them now are turning over a hell of a lot, this can be a profitable business, and works for landlords if they can get into a partnership,” he says. Subplot has been told of turnover in the wetter-led attractions that would make any landlord salivate: up by a factor of six in some cases, looking at £5m-plus turnover a year from a 10,000 sq ft unit. Traditional leases of 10-15 years are standard among the better players.

And the losers pay

Not everyone will be so lucky. The sportier, more serious concepts, or those with customers less into their cocktails and burgers, turnover a lot less. Figures are opaque, but some operations are still demanding (and getting) very substantial fit-out contributions and rent-free periods from landlords. In March 2021 Subplot reported capital contributions of £400,000-£700,000 and rent free of 12-18 months: today it can be every bit as generous, with £40/sq ft by no means unheard of.

Not so easy

New concepts are getting smaller and more demanding. “The tech-focused immersive operations, who need simulators or use AI, have a higher electrical power specification and want their units configured to suit headsets or booths. They may only need 4,000 sq ft,” Stokes says. Windows and an outdoor eating/drinking area are also on some operators lists.

Gravity’s deal is unusually big, but it inaugurates a period when competitive socialising will set the pace in town and city centres.


Going up, or going down? This week’s movers

Ding! Ding! Ding! Why can’t you get a lift? It’s because American investors have the doors open. Down in the loading bay, Warrington Council is also waiting but nobody knows what for.


A ton more American money is coming to the North West. How can we be so sure? Because they tell us so. Blackstone, the US private equity giant with £580bn under management, launched in Birmingham earlier this month with a £185m buy and is in talks about a Manchester purchase on a similar scale (some reports say it might be closer to £220m, but who knows?). Blackstone do not do “orphan” investments so expect an a la carte selection from the office sector, maybe some student housing or hospitality, even BTR. Blackstone have the resources to cope with the painfully low yields of today’s logistics property sector, so look out for action there, too. Whatever they buy will have ‘sustainability’ written in capital letters all over it.

Local players are braced. “The market is continuing to see strong interest from North American investors – a lot of the conversation is focusing on industrial and logistics, but we’ve also had people knocking on the door about office and residential schemes. Funds are having no issues in raising money; the challenge is finding the right place to deploy that capital,” says Hamer Boot, executive director at HBD. “Schemes that will typically be of interest to US investors will be in a prime location and will have a good ESG rating; new office schemes will need to be net zero carbon.” Expect some big announcements very soon.

Warrington Council’s property investment strategy

Warrington Council’s unusual investment strategy has been attracting startled comment for some time. The scale – £1.7bn rising to £2.3bn – is jaw-dropping and some of the decisions eye-rolling: last week’s revelation about another £18m property loan linked to THG Group co-founder Matthew Moulding falls into this category. The loan, believed to be secured on mostly warehouses, is part of a £202m facility to Icon 3 Holdco, a company controlled by Moulding, says the Local Government Chronicle, which has seen the paperwork. Icon 3 Holdco Ltd has two charges registered in favour of Warrington Council. It is owned by Icon 4 Holdco, which is in turn controlled by Mr Moulding. The 2020 accounts, filed in September 2021, show £17m assets and, £39m owed and falling due within a year.

The Mail has a slightly different version: their story revolves around Moulding Capital. So does Warrington Council’s version. In a statement to Subplot the council said: “We took the decision to provide this loan to Moulding Capital Limited, to support local jobs and local regeneration/economic development. We have been operating our loans programme successfully since 2009 in promoting economic regeneration in Warrington.’’

The only company of this name Subplot could find is in Guernsey, and its business is the leasing of ships and aircraft, which looks like a poor fit. In the UK, the nearest match is Moulding Capital Newco, founded in December 2021, and with no visible property charges registered. Warrington Council say this Newco entity isn’t the company involved. No doubt the puzzle will become clear eventually.

Prudent lenders have a heads-we-win-tails-you-lose approach: if you pay back the loan, bingo, and if you don’t they get to keep the security. Maybe Warrington Council is brighter or more cynical than we thought?

As a footnote, THG declined to comment on the loan, or the latest stage of its 1m sq ft Airport City campus project: Bowmer + Kirkland and Goldbeck are set to be appointed to complete the first phase. A start date is not yet known.

Get in touch with David Thame: david.thame@placenorthwest.co.uk | 01544 262127

The Subplot is brought to you in association with Oppidan Life.

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Arguably Printworks in Manchester has operated in a similar field for decades, as a city centre entertainment focused venue.

By Jeff

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