Savills : The growth of the video gaming industry and the vital role of real estate

The video game business is extremely competitive and consequently choosing the right real estate is essential not only for effective studio production but also the retention and attraction of talent, of which the pool is currently finite.

Right now, the UK is the leading video game market in Europe and the sixth largest gaming market worldwide. According to the trade association for the UK's games industry, Ukie, the UK market for video games grew approximately 30 per cent in 2020 to reach a record £7 billion. It's no surprise then that we are seeing new entrants to the market, with Netflix announcing its intention to expand into video games earlier this year.

We also saw this growth reflected in job numbers. According to Statista, in 2020 the number of full-time creative staff employed at video game studios rose at the highest rate since 2011.

The growth of games specialist courses have also grown in recent years and Nesta research shows there is a positive link between the presence of educational establishments offering these courses and games industry clustering. For instance, Staffordshire University London, which offered the UK's first esports undergraduate course, is co-located next to an e-sports arena at Here East in East London; consequently the area has become a honey pot for video game developers.

The development of these locations as hubs is driven not only by the talent available but also by better broadband access and the co-location of other creative industries such as design, advertising, software and film, video and TV.

So as these companies grow what does optimum space for them to operate in look like?

Video game studios are incredibly power intensive. You will often find the average desk containing more IT equipment than your average office and supported with power hungry servers. This means that the energy capabilities and durability of the building are especially important to ensure that high-powered equipment is able to operate effectively. Often power requirements are as high as 800-1,000W per desk compared with a typical office use which might be closer to 100W per desk. In addition, many users have a requirement to have a dual supply from separate sub-stations to ensure resilience.

With all this power and electrical equipment there needs to be adequate cooling in place. Often modern cooling requirements are not enough and the studio will need supplementary AC. Office floors are also less densely packed to accommodate staff comfortably, not only for temperature considerations but also to provide the all-important workplace experience. This is extremely important in the attraction and retention of skilled developers and individuals, for whom there continues to be huge demand.

These studios provide physical spaces which is a key ingredient for productivity in the sector. A sound studio, motion capture room and game testing areas also allow different disciplines to physically work alongside each efficiently and productively.

With a shortage of high-quality office accommodation and the growth of the gaming industry moving forward speedily, gaming companies looking for office/studio accommodation might find that competition for space that fits their requirements becomes increasingly robust, especially as more and more firms return to the office.

Further information

Contact Robert Pearson

Report: Media Cities