There’s the adage that a healthy body brings a healthy mind, but increasingly, we’re seeing this also means a healthy bottom line for fitness businesses. We’re currently witnessing one of the biggest booms in the health space, as the UK fitness industry’s market value has reached an all-time high in 2023.
But what can be attributed to this success, and why now? A perfect combination of the increased freedoms post-Covid, more choice in gym and class providers than ever before, and a change in public perception of the value of health and fitness. Here, we’ll take a closer look at how all of these elements came together at the right time.
The limitations of the home gym
Following a huge uptake in people working out at home during the Covid-19 pandemic, there’s been a significant drop in the growth of at-home-focused workouts in the last few years. With workers returning not only to the office but also to their social activities outside of the house, many of the once highly coveted Pelotons have been relegated to glorified clothes horses.
Gyms can, of course, offer much more equipment that the average person can afford or fit into their house. Working out in public gives a sense of accountability and the chance to develop bonds with classmates and other regular gym goers. There’s also the simple appreciation of the freedoms people have regained after lockdown restrictions were lifted, and so they’re making the most of activities outside of the home.
We’re seeing this demand in the businesses we’ve funded recently. Total Fitness has been running gyms across the North of England for over 30 years, and it, too, has future growth plans in mind. We backed them with a £6.5m loan to restructure their existing debt and to prepare for its next expansion plans, so it’s primed and ready to meet the growing demand for large and affordable gyms.
An increased focus on health post-Covid
Health was brought to the forefront of many people’s minds in the wake of Covid-19, and with health inextricably linked to fitness, it makes sense that many people’s attitudes to regularly working out changed for good. Some changed their mindset during the pandemic, and for others, lockdown restrictions meant they were itching to get moving again once rules were relaxed, but across the country, we’re seeing a re-evaluation of priorities to focus on fitness.
Using dumbbells at home and socially distanced walks was a cheap and easy-to-access version of fitness for many during lockdown. But post-pandemic, the more sophisticated equipment found in physical gyms is the next step in keeping fitness a permanent part of people’s routine.
The rise of boutique gyms and fitness classes
If you can think of a sport, there’s a class for it. Offered in bespoke, kitted-out locations, classes are popping up with specialist focuses – and they’re getting much more elevated than the yoga session in your local community centre.
Boutique spin classes, boxing, and Reformer Pilates are some of the fastest-growing classes with the latest specialist equipment – and there’s money to be made here. The global boutique fitness studio market was valued at $49.3 billion in 2021 and is expected to reach $66.2 billion by 2026.
Among the leading boutique gyms in London is Third Space, a stylishly designed luxury collection of health clubs, helping to completely raise the bar for what high-class fitness centres look like. Occupying sleek buildings in Canary Wharf, Marylebone and Mayfair, plus a roster of A-list clients, it’s got grand plans to expand its aspirational clubs across the capital. We partnered with Searchlight Capital Partners to provide Third Space with a £88.5m loan so that it could continue to grow at pace.
Business is clearly booming across the fitness industry – from big box gyms to specialist classes. And with more and more people interested in investing in their health, there’s plenty of opportunity for businesses to expand. If you’re a growing fitness business that is looking for a lending partner with experience in the sector, find out how we can support you with specialist financing.