Bowling alleys
This publication is intended for Valuation Officers. It may contain links to internal resources that are not available through this version.
1.1
This instruction applies to all tenpin bowling alleys.
1.2
Ten-pin bowling was introduced into this country in 1960 and initially enjoyed increasing popularity until the late 1960s and 1970s, when the game’s popularity declined dramatically.
1.3
There was a resurgence of interest, coinciding with the economic boom of the late 1980s, and many new bowling alleys were built from 1989 until about 1993. With the economic slowdown, few new alleys were opened but as the economy recovered construction of new alleys of all types recommenced.
1.4
The Ten Pin Bowling concept has however evolved, and bowling can now form part of a multi-generational entertainment centre, where bowling is mixed with other forms of activity. The major operators have particularly sought new premises on Leisure Parks.
2.1
Primary description: LX
List description: bowling alley and premises
Scat code: 028
Scat suffix: S
3.1
This is a specialist class of property, to be valued by the National Valuation Unit.
4.1
The Class Co-ordination team specialist leisure has overall responsibility for the co-ordination of this class. The team is responsible for approach, accuracy and consistency of valuations.
4.2
The team will deliver practice notes describing the valuation basis for revaluation and provide advice as necessary during the life of the rating lists. Caseworkers and referencers have a responsibility to:
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follow the advice given at all times
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not depart from the guidance given on appeals or maintenance work without approval from the co-ordination team
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seek advice from the co-ordination team before starting any new work
5.1. General
5.1.1
Other than planning and adherence to the provisions of the Licensing Act 2003 and the Gambling Act 2005, no specific legal framework is understood to exist for this class of property.
5.2. Rateable elements
5.2.1. The bowling lanes
Essentially a bowling centre is a large box designed to contain the maximum number of bowling lanes, opening on one side to give easy access to ancillary areas.
The bowling lanes occupy most of a typical centre and these are considered to be rateable as part of the hereditament.
5.2.2. The pin-spotting equipment
The costly automatic pin-spotting equipment in a ten-pin bowling alley is considered to be non-rateable and rents including such items must be adjusted. In a receipts and expenditure valuation such equipment will form an important item of tenant’s capital and costs of maintenance, and provision for renewal, will be considerable. Alternatively, pin-spotters are sometimes separately hired.
5.2.3. Fit out
Nearly all new lettings for this use are as shells, with operators commonly spending substantial sums to fit out.
The walls, ceilings, flooring, bowling lanes and services are rateable, whilst the bowling machinery, video and electrical wiring for the machinery and loose equipment are not. It is estimated that around 50% of the total fit out cost relates to the rateable elements.
6.1
Bowling Alleys should be measured to gross internal area (GIA) in accordance with the VOA Code of Measuring Practice for Rating Purposes.
6.2
The survey should record the following information:
The type of premises, previous use where known, age, construction, services (including heating and/or air conditioning), the date when last refurbished, the number of lanes, the type extent and quality of ancillary facilities, the number and type of gaming machines, the availability of car parking, location, transport links, existing and proposed competition, competing or complementing leisure attractions in the area, etc.
6.3
The GIA of the ancillary facilities should be separately recorded
7.1
Rating surveys should be captured on the Rating Support Application (RSA) and plans and surveys stored in the property folder of the Electronic Document Record Management System (EDRM).
8.1 Method of valuation
8.1.1. Rental method
A significant proportion of all bowling alleys are subject to arm’s length rents, and whilst, clearly the rental method is to be favoured, it should be borne in mind, that rents on new letting are often on a shell basis. In such cases, details of fit-out costs will be required for analysis; rents should be analysed at a price/m2 GIA . Rents on review need to be treated with caution, as the rent review provisions under the lease may provide for the rent to be determined having regard to other uses; it will therefore be necessary to establish the precise rent review terms.
Adjustments may also need to be made to rents, in respect of rateable and non-rateable items (see paragraph 5.2 above).
The best method of achieving uniformity in assessments is by the application of a price/m2 to the GIA of the whole building. (See relevant Practice Note.)
8.1.2. Receipts information
Whilst regard can be had to receipts information, it is only likely to assist in identifying the order of relativity of value between different properties. Such information must be treated with caution, as incomes have been found to vary far more than rents, and evidence shows that the letting market is not receipts driven.
8.2. Rental analysis
Rents on bowling alleys are capable of analysis in a number of ways:
8.2.1. GIA
Given the increasing tendency for modern bowling alleys to include large areas of ancillary accommodation, analysis based on an overall price per m2 (GIA) basis is the best method of achieving uniformity in assessment.
8.2.2. Linage
Emphasis on this comparison factor has declined in importance, as the proportion of total income generated purely from bowling has reduced. As a result, it is not suitable as a reliable method of analysis. Linage is the average number of games played per lane per day. Information may be obtained as to linage when considering a rent or upon inspection. Statistics should include the number of days in each of the relevant years that the bowling alley was open.
8.2.3. Number of lanes
For analysis purposes, this approach is straightforward, requiring merely a mathematical division.
It is, however, an unreliable method of comparison unless properties have the same number of lanes and very comparable areas of ancillary accommodation.
8.2.4. Percentage of gross receipts
It is not appropriate to use this as the primary method of comparison, since open market rents for bowling alleys are not determined having regard to receipts, either for a new letting or upon rent review. Evidence shows that receipts vary far more than rents.
Where receipts information is available, then revenue from all sources, e.g. advertising, gross sales of refreshments and car parking (unless separately assessed) should be included in any analysis.
8.3. Valuation factors
8.3.1. Location
The prime location for a bowling alley is an out-of-town leisure park with complementary leisure uses, good road access and ample car parking. Operators will pay close attention to the demographics of the catchment population.
8.3.2. Age
Many of the older bowling alleys have undergone significant works of improvement since they were built / converted; such units should be valued having regard to the date these works were completed. An adjustment for quality may be required.
8.3.3. Construction
Alleys constructed from the late 1980s onwards are generally purpose-built, often on leisure parks; construction is usually a steel portal frame with profiled metal sheet cladding and roof, lined internally and insulated. Normally the main areas will have a suspended ceiling and a ducted warm and cool air circulation system. These alleys will have the highest values. Several alleys from this period were converted from ex-retail warehouses; these will be the next highest in the range of values.
Bowling alleys constructed in the 1960s were often in converted cinemas or purpose built in part of a building, often at first floor level. Many of these are in relatively poor locations and do not have sufficient space to adequately offer the range of ancillary facilities provided at most modern alleys. These will be lower down the range of values.
9.1
Within RSA, analysis and valuation scales specifically for this class enable input of factual data to achieve valuations that follow the recommended approach.
9.2
Adjustment for fit-out should be made as a survey unit adjustment under code QAL. See Practice Note for further guidance.
9.3
Additional support is available through:
- Survaid
- Class Co-ordination team for specialist leisure
1. Market appraisal
1.1 The ten-pin bowling market forms a small, but fast growing, part of the UK’s ‘out of home’ leisure sector.
1.2 Late 2020 the UK had 312 ten-pin bowling venues. The leading three operators control 44 per cent of all UK centres.
There are 4 types of operators identified within the UK ten-pin bowling market
- Major multiples (estimated 71 per cent market share) operating five or more centres.
- Other multiples (estimated five per cent market share), operating fewer than five centres.
- Urban bowling operators (estimated seven per cent market share) catering primarily for professionals, operating smaller sites with a focus on the ‘urban’ market and an emphasis on food and beverage sales.
- Independent operators (estimated 17 per cent market share) operating single centres, which are typically smaller and situated in tertiary locations.
1.3 The total number of tenpin bowling alleys has remained relatively steady but there has been a decline in the number of lanes.
1.4 Growth will be underpinned by the development of new centres, pro-active management to control outgoings, re-branding, continued refurbishment of existing centres, discounting prices and improving the range, type and quality of the catering. The ‘competitive socialising market’ is rapidly evolving, there is a strong consumer appetite for unique and challenging non-bowling experiences, and this can be seen with the rapid expansion of boutique bowling alleys.
1.5 Whilst some operators have withdrawn from the market completely, some have chosen to reduce the size of their estate whilst others have actively expanded the size of their portfolio.
1.6 The accessibility of bowling locations is a factor – in 2017 an estimated 47 per cent of the UK’s population live within a 15-minute drive of a bowling centre, compared with 69 per cent living within a 15-minute drive of a cinema. Distance may be a factor in deterring some consumers from visiting centres and may also impact negatively on repeat visits.
1.7 A number of independent bowling centres across the UK which are struggling. There is a strategic focus by leading operators in acquiring these existing sites and modernising the facilities to drive growth by reinventing the layout of premises to offer more private experiences for small groups of friends and family.
1.8 The ten-pin bowling market was worth £311m in 2018 and grew at an annual rate of 4 per cent between 2015-2019.
1.9 Impact of the COVID19 pandemic
The COVID-19 pandemic had a major impact on indoor bowling alleys in the period leading up to the AVD (1 April 2021). Details of the various restrictions implemented by statute in response to the pandemic, and of the vaccination rollout, can be found online. In February 2021 the UK Government published its Roadmap out of lockdown for England which set out four steps to relax restrictions. Step 1 8th March, easing restrictions on outdoor gatherings, had already taken place by the AVD.
The later three stages of the Roadmap for England included
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the opening of outdoor hospitality, and non-essential retail (Step 2, no earlier than 12 April); and
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most legal restrictions on meeting others outdoors to be lifted, opening of indoor entertainment venues such as cinemas, casinos and bingo halls (Step 3, no earlier than 17 May 2021); and
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the removal of remaining restrictions on social contact (Step 4, no earlier than 21 June). Subsequent to 1 April 2021 steps 2 and 3 took place as planned, but Step 4 was delayed four weeks to July 2021.
The situation in Wales, both leading up to and after the AVD, was similar although not identical.
2. Changes from the last practice note
2.1 There are no changes from the approach that was adopted for the 2017 Rating Lists.
3. Ratepayer discussions
3.1 There have been no 2023 List discussions on this class of property.
4. Valuation scheme
4.1 The recommended valuation approach is to adopt an overall price per square metre GIA which reflects the location and physical characteristics of the property.
4.2 The value to be adopted should be derived from an analysis of the available rental evidence.
4.3 The value of the ancillary accommodation is deemed to be reflected in the price adopted.
4.4 An appropriate addition to reflect fit-out should be made in accordance with the guidance contained in Appendix 1.
4.5 In the absence of direct evidence to the contrary, an allowance of up to 2.5% can be made on bowling alleys which comprise 30 or more lanes.
5. IT support
5.1 The development within RSA of analysis and valuation scales specifically for this class should enable input of factual data to achieve valuations that follow the recommended approach.
The following scale of fit-out additions should be applied to the adopted shell rate.
These figures assume a standard of fit-out equivalent to that of a major operator. Judgement will be required for those properties with a lower standard of fit-out. Fit-out additions for converted and / or refurbished properties should reflect the date of conversion / refurbishment.
| Age | % Addition |
| 2021 | 26.5% |
| 2020 | 26.0% |
| 2019 | 25.0% |
| 2018 | 24.5% |
| 2017 | 24.0% |
| 2016 | 23.5% |
| 2015 | 23.0% |
| 2014 | 22.5% |
| 2013 | 22.0% |
| 2012 | 21.5% |
| 2011 | 21.0% |
| 2010 | 20.5% |
| 2009 | 20.0% |
| 2008 | 19.5% |
| 2007 | 19.0% |
| 2006 | 18.5% |
| 2005 | 15.0% |
| 2004 | 15.0% |
| 2003 | 15.0% |
| 2002 | 15.0% |
| 2001 | 15% |
| Pre 2000* | 10.0%* |
*The addition for fit-out which pre-dates 2000 is to be fixed at 10% providing there has been no subsequent refurbishment or replacement.
1. Market appraisal
The total number of tenpin bowling alleys has remained relatively static over the last seven years and the industry, which comprises a mix of chain, niche and independent operators, has remained very fragmented.
Since 2008, economic uncertainty, high operating costs and an inability to attract regular repeat business have combined to produce very difficult trading conditions. Rental levels have suffered as a result although the impact has varied across the sector dependent on location, customer base and the range of facilities on offer.
Operators have responded differently to the challenging circumstances they have faced; some have withdrawn from the market completely, some have undergone financial restructuring which resulted in Company Voluntary Arrangements, a number have chosen to reduce the size of their estate whilst others have actively expanded the size of their portfolio.
Pro-active management to control outgoings, re-branding, discounting prices, and improving the range, type and quality of the catering and non-bowling activities that are on offer, are all measures that have been widely adopted to help stabilise / improve viability and enhance general appeal.
Many operators are now reporting that they are starting to experience a growth in revenues; this growth has largely come from an increase in the income received from secondary spend (catering / bar / other entertainment). An improving economy allied to this trend suggests that the outlook for the tenpin bowling industry is one of cautious optimism; this optimism is likely to result in an improvement in rental levels.
2. Changes from the last practice note
There are no changes from the approach that was adopted for the 2010 Rating Lists.
3. Ratepayer discussions
There have been no 2017 List discussions on this class of property.
4. Valuation scheme
The recommended valuation approach is to adopt an overall price per square metre GIA which reflects the location and physical characteristics of the property.
The value to be adopted should be derived from an analysis of the available rental evidence.
The value of the ancillary accommodation is deemed to be reflected in the price adopted.
An appropriate addition to reflect fit-out should be made in accordance with the guidance contained in Appendix 1.
An end allowance for divided or split accommodation (i.e. two floors) of up of 10% can be made in appropriate circumstances.
In the absence of direct evidence to the contrary, an allowance of up to 2.5% can be made on bowling alleys which comprise 30 or more lanes.
The following scale of fit-out additions should be applied to the adopted shell rate.
These figures assume a standard of fit-out equivalent to that of a major operator. Judgement will be required for those properties with a lower standard of fit-out. Fit-out additions for converted and / or refurbished properties should reflect the date of conversion / refurbishment.
| AGE | % Addition |
| 2015 | 26.5% |
| 2014 | 25.5% |
| 2013 | 24.5% |
| 2012 | 24.0% |
| 2011 | 23.5% |
| 2010 | 23.0% |
| 2009 | 22.5% |
| 2008 | 22.0% |
| 2007 | 21.5% |
| 2006 | 21.0% |
| 2005 | 20.5% |
| 2004 | 20.0% |
| 2003 | 19.5% |
| 2002 | 19.0% |
| 2001 | 18.5% |
| 2000 | 15.0% |
| 1999 | 15.0% |
| 1998 | 15.0% |
| 1997 | 15.0% |
| 1996 | 15.0% |
| 1995 | 15.0% |
| Pre 1995* | 10.0%* |
- The addition for fit-out which pre-dates 1995 is to be fixed at 10% providing there has been no subsequent refurbishment or replacement.
1. Co-ordination arrangements
This is a Specialist Rating Unit (SRU) Class, responsibility for ensuring effective co-ordination lies with the SRUs. For further information see RM: Section 6: Part 1.
The R2010 Special Category Code 028 should be used. As an SRU Class the appropriate suffix letter should be S.
2. State of the market at April 2008
Since 2003 the industry has been generally static. A number of older alleys have closed, with only a handful of new alleys opening, usually by smaller independent operators.
3. Analysis
3.1 The most consistent answers are produced by analysing rents in terms of GIA as was negotiated with the major agents on the 2000 and 2005 Rating Lists. This will continue to be the basis for 2010.
3.2 With the lack of new developments, up to date analysis of fit-out has not been possible, however, the following scale of recommended fit-out additions in respect of the major operators for the 2010 Rating Lists, with interpolation between the years is considered appropriate.
|
Age of shell |
1989-1993 |
1994-1998 |
1999-2001 |
2002-2004 |
2005 + |
|
Fit-out addition (% of rent) |
15% |
17.5% |
20% |
25% |
26.50% |
These figures assume fit-out equivalent to that of a good major operator and would be at a higher level than many refurbishments or conversions of older premises.
Judgement will be needed on the addition for fit-out on older properties, where substantial refurbishment has taken place and those with a lower quality of fit-out.
4. Valuation
4.1 Following on from previous national negotiations, all properties should be valued for the 2010 Rating Lists on a £/m2 GIA basis to include ancillary accommodation such as bar, restaurant or games area. Levels of value will be based on the analysis of rents of bowling alleys within, and adjacent to, the SRU area in question, with adjustment to AVD, and an appropriate addition to reflect fit-out.
4.2 An end allowance for divided or split accommodation (i.e. two floors) of up of 10% can be made in appropriate circumstances.
4.3 Receipt information must be treated with caution. Analysis has shown incomes to vary far more than rents, as the letting market is not accounts driven. Receipts are one of a number of factors likely to assist in identifying the relativity of value between different properties when taking a “stand back and look” view of the property.
4.4 Converted units should be valued having regard to the date of conversion or improvement, and the quality of that conversion.
5. IT support
The development within RSA of analysis and valuation scales specifically for this class should enable input of factual data to achieve valuations that follow the recommended approach.