Online gaming is growing in popularity: the UK video games industry’s value is currently the same as the music and video industries combined and over £13.2 billion has been invested in UK video games companies since 2016, the second highest volume worldwide. What’s driving this growth and what impact will it have on property? 

One of the contributing factors has been the rise in popularity of eSports – competitive gaming among multiple players which, at its height, takes place in front of a live audience.

The industry now has global revenues of $400 million and eSports tournaments have attracted tens of thousands of UK fans when they’ve been held in venues such as London’s O2 arena. The demand among fans for new titles to satisfy their eSports needs has revitalised the industry worldwide. It’s expected by 2020 that global revenues will exceed $1 billion.  

Specifically in the UK, the Government’s introduction of a Video Games Tax Relief in 2014 for British-developed games has made the nation’s gaming industry more competitive globally and encouraged companies to expand here above other locations.

There are now 2,153 games companies active around the country, with 634 in London. Seven of the top 10 largest gaming companies in the world have a UK hub, including Sony Computer Entertainment, Activision Blizzard and Electronic Arts (EA). The former occupies approximately 133,000 sq ft in the heart of London’s Soho, but the latter two have chosen to base themselves outside the capital: Activision Blizzard has 20,200 sq ft of offices in Slough, while EA has a 90,600 office in Guildford.

While to date video games occupiers have largely based themselves in the South East, the next generation of companies looks set to be spread more evenly across the country. The UK is currently undertaking a revolution in computer games education: 91 universities now offer a total of 229 games courses. Furthermore, the industry is growing: there have been 204 new games companies created since 2016 across the UK.

The locations of these new companies are relatively disparate, which provides an opportunity for a market, town or particular scheme to create an ecosystem which could act as a hub for the gaming community. There are already gaming hotspots such as London, Brighton, Bristol and Sheffield, to name but a few – one of these could become such a hub, although we expect them all to grow.  

In addition we may see a new wave of eSports venues being developed. To date the industry has been content with using cinemas or other venues for events, but as audiences and the number of players grow the clamour for specialist eSports theatres and arenas is likely to increase. Games developers and their industry organisations are therefore set to be increasingly active in the property market. Game on.

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