The economic impact of late night venues

Nighttime economies are an important part of many cities throughout the world, but safety concerns have resulted in venue closures and strict regulation over recent years.

So how can policymakers and communities work together to strike the right balance between safety and culture?

This summer, the drug-related deaths of two 18-year-olds at London’s legendary Fabric nightclub put the safety in the UK’s nighttime economy under scrutiny. Islington Borough Council chose to close the venue in September, believing this was the best way to prevent future casualties. While anti-social behaviour and nightlife often go hand in hand, it’s possible for local authorities and venue operators to work together to make late night hospitality both safe and profitable.

London isn’t the only city with safety concerns over nightlife. Since January 2014, Sydney has operated ‘lock-out laws’ that place restrictions on the sale of alcohol and late night entry to nightclubs. Critics of the measures have voiced concerns over the potential of fewer patrons and decreased turnover for bars, music venues and restaurants as the city’s once-vibrant nightlife is dulled by regulation.

This year, two music industry bodies in Australia released figures showing that live performance revenue had dropped 40 percent in Sydney’s central business district, while a 19 percent decrease in nightclub attendance was also reported. Sydney Lord Mayor Clover Moore said the regulations have been a  “sledgehammer” to the city’s late night economy.

Back in the UK, London Mayor Sadiq Khan is fully aware of the financial pitfalls of penalising the late night sector. In a statement on Fabric’s closure, Khan urged local authorities to work alongside law enforcement and venue operators to “ensure London thrives as a 24-hour city, in a way that is safe and enjoyable for everyone”.

Kate Nicholls, chief executive of the Association of Licensed Multiple Retailers (ALMR), a trade body representing the licensed hospitality sector, believes a collaborative approach to late night regulation is key to achieving Khan’s vision.

“Most local authorities and regulatory bodies have a shared objective, which is a safe environment in the nighttime for people to go out and enjoy themselves,” Nicholls says. “If you sit down together and create a neighbourhood plan, then you can make sure that you meet the needs of the local economy, local residents and businesses, and minimise any harm.”

On the day that Fabric’s closure was announced, Berlin’s famous Berghain techno club was awarded the same tax status as ‘high culture’ venues by a local fiscal court in Germany. Policies like this foreground the economic and cultural value of nightlife. “Berlin works really well with operators to make sure support is given in recognition of their key cultural, social and economic importance,” says Nicholls.

One formal way that the UK’s local authorities and venue operators can forge a partnership is by working to achieve Best Bar None accreditation. The Home Office-supported scheme sees late night businesses partnering with local government and law enforcement to promote best practice and reduce alcohol-related violence. Venues are given a bronze, silver or gold rating and are rewarded with a plaque displaying their status.

Nicholls cites Durham as an example of a city that’s experienced success after its bars, clubs and music venues sought Best Bar None accreditation. Some licensees in the city have reported more than a 25 percent increase in turnover and a 15 percent increase in footfall since the scheme’s launch in 2008, demonstrating that regulated nightlife can be fun and profitable.

“In a nighttime economy there will always be individuals who can’t police their own behaviour,” says Nicholls. “Best Bar None focuses on establishing high standards on the premises, which ensures a positive example is set and encourages patrons to keep their behaviour in check.”

Some of Europe’s most lucrative late night economies have found success by thinking outside the box with their policies. In 2014, Amsterdam appointed a so-called ‘night mayor’ to act as an ambassador for nightlife interests and facilitate dialogues between businesses, residents and local government. Paris, Toulouse and Zurich have each appointed a night mayor this year, illustrating that policymakers feel nightlife representatives could be a positive way forward for the sector.

Similarly, Sadiq Khan recently initiated the search for a ‘Night Czar’ to advocate for London’s struggling late night sector. In the past five years, the number of nightclubs operating across the city’s 33 local authorities has dropped by 50 percent. While over-regulation is not the sole reason for the closures, Sydney’s lockout laws illustrate the damaging effect restrictive policy can have on businesses operating in the late night space.

A thriving nighttime economy and a safe, responsible nightlife culture don’t need to be mutually exclusive, but authorities and venues must support each other. Whether it’s through formal accreditation schemes like Best Bar None or the appointment of designated nighttime advocates, working together is the key to making nightlife safe and prosperous for everyone.

Johanna Hart is a freelance writer whose work has been published by Google, Facebook and Natwest.