Article | Adaptive Spaces
Opportunities to accommodate the growing Esports industry
26 Jul 2022 4 Minute Read
Continuing expansion of the global gaming sector brings significant implications for the real estate industry and a multitude of potential opportunities for landlords and investors to explore and tap into. These include the opportunity to repurpose underperforming secondary property stock into development, testing and admin spaces. But, expansion in the gaming sector is also triggering additional growth amongst supporting ecosystems, from data centres to Esports arenas across the country. Gaming platforms are also set to provide the building blocks of the emerging Metaverse, which could further accelerate organic growth and M&A activity across the sector.
Of the adjacent gaming related opportunities, Esports is worth calling out for special attention, given its steep growth trajectory. For the uninitiated, Esports operates at the crossroads of gaming and game-related live streaming, combining both playing and watching. Of late, Esports expansion has been spurred on by the reopening of physical events following pandemic suspensions, plus online technology innovations such as simulation of crowds chanting, augmented reality and live chat., These innovations are fostering deeper engagement with a widening fan base with options of attending events, either physically or digitally.
In a breathtakingly short space of time, the industry has snowballed from niche activity to billion dollar industry and shows little sign of slowing down. In 2022, the global Esports audience is expected to grow by nearly 9% to reach 532 million and will generate nearly $1.38 billion in revenues globally by the year end.
The outlook for Esports growth in the UK echoes the global trajectory. The West Midlands region is in pole position, now established as an Esports global leader, responsible for one quarter of the output in this sector. Big gaming names here include Sega Hardlight and Codemasters, and the area also boasts a workforce of more than 3,000 games professionals and state-of-the-art facilities and talent at the University of Warwick (recently named as UK Esports University of the Year for a fourth consecutive year).
Further expansion beckons. To cement its position as a global ESports centre and talent hotbed, the West Midlands recently agreed a 10-year deal with the Global Esports Federation (GEF) to join a network of global hubs. The region will host the first ever Commonwealth Esports Championships this summer - a huge opportunity for both the region and the UK.
From a property perspective, Esports will continue to bring its own blend of property requirements and opportunities for developers, landlords and investors. With the maturing of this industry, we are witnessing a broad range of experimentation of space concepts, use and design. We see new Esports café concepts at one end of the scale (effectively next generation internet cafés) and at the other end of the scale, the large, Esports arenas. Esports teams are also developing HQs for training, admin and engagement.
If you are a landlord, investor or developer and would like to explore this evolving opportunity please get in touch.