1 in 7 licensed venues lost in capital centre
The latest Market Recovery Monitor from CGA by NielsenIQ and AlixPartners showed how closures have been particularly high in areas of central London that are reliant on office workers and tourism.
When looking at London as a whole, the capital saw a drop of 10.5% in licensed venues and when split into the different areas of the city, the northern and eastern regions now have 8% and 9.1% fewer licensed venues than in March 2020 respectively.
This was put down to the number of commuters who previously travelled into London for work but are now working from home, especially during the lockdown periods in 2020 and 2021.
While other major cities in England have also seen a decrease, most were not as sharp as the City of London.
Working patterns shift
How many pubs and restaurants have closed in the major city centres:
Liverpool – 1.3%
Manchester – 4.5%
Edinburgh – 5.3%
Glasgow – 10%
Birmingham – 14%
London – 14%
Birmingham saw the same percentage of licensed venues drop (14%), followed by Glasgow (10%), Edinburgh (5.3%) Manchester (4.5%) and Liverpool (1.3%).
CGA director for hospitality operators and food EMEA Karl Chessell said: “The City of London’s hospitality market was hit harder than most city centres by Covid-19 with lockdowns and restrictions limiting commuting and tourism initially.
“However, shifts in working patterns are going to be permanent for many and this has led to a sustained impact on the centre of the capital.
“Many venues have closed their doors for good over this period and it is uncertain if they will open again.
“It is not all doom and gloom with other parts of London proving more resilient but now more than ever, it is important to get a hyperlocal understanding of each area and the local demand.”
Fundamental change
The study illustrates how hybrid working has impacted business districts in some of the nation’s key larger cities, AlixPartners managing director Graeme Smith said.
He added: “The fundamental change in how and where many of us work is clearly a significant cultural shift, a legacy of the pandemic that has inevitably impacted restaurant and pub numbers in these areas.
“The shock is tempered by the fact some UK cities – those that perhaps have a more diverse mix of business, leisure and residential demand – have not seen anything like the same impact.
“Given the catastrophic events of the past two years, numbers have held up well. Ultimately, this is as much about the changing nature and location of demand and the eating and drinking out market will inevitably adjust to these shifts, in the longer term.”
