Where can you go on holiday for less than Center Parcs?
The British resorts cheaper than Center Parcs: Where you can go on holiday for less amid fears holiday firm’s prices will rocket after takeover – and how trips to sites in Europe could be less than half the cost
- Centre Parcs is fourth most expensive holiday park provider, says Which? study
- Guests report average spend per person of £71 per night according to the report
Centre Parcs is the fourth most expensive holiday park provider in Britain with guests reporting an average spend per person of £71 per night, it can be revealed.
The brand has five sites across the UK – Whinfell in Cumbria, Longleat in Wiltshire, Sherwood in Nottinghamshire, Woburn in Bedfordshire and Elveden in Suffolk.
And a study by consumer group Which? surveying 1,355 members and the public last year found its cost was behind only Waterside Holiday Group (£80), Shorefield Holidays and Potters Resorts (both £72) – with the latter an all-inclusive price.
Center Parcs was also placed at joint 11th out of 18 sites under a customer score measure, while Potters and Waterside were the top two and Shorefield was sixth.
At the other end of the table, Parkdean Resorts was cheapest at £34, then Haven at £35 – but they also both finished joint second bottom for customer satisfaction.
And research by MoneySavingExpert earlier this year found Center Parcs resorts in Belgium, France, Germany and Holland can be half the price of UK parks – especially during the UK school holidays and even after the cost of travel has been factored in.
Its study found the Longleat park in Bedfordshire had three-bedroom lodges starting at £2,798 for early August this year – compared to €1,200 (£1,065) at its Limburgse Peel site in the Netherlands. When flights for a family of four at £140 were added to this cost, the total still came to only £1,205, which is £1,593 less than the UK break.
MSE’s report quoted one holidaymaker saying: ‘We’re going to France Center Parcs in the school holidays. Longleat for four adults and four children was £3,200. France is £1,500, including crossing.’ Another added: ‘We went to Center Parcs Erperheide in Belgium. It was much cheaper than UK, but an identical experience.’
The data emerged as experts warned the cost of holidays at Center Parcs could rise if the chain is sold by its Canadian private equity owner for up to £5billion.
While the cost figure makes a useful comparative tool, Which? said it was ‘indicative’ and based on respondents’ recall of the average spend per person per night.
Center Parcs was also slightly more expensive than the likes of Warner Leisure Villages (£67) and Forest Holidays (£62) – and significantly more than Pontins (£49) and Butlin’s (£41).
Others in the study included Away Resorts (£56), Hoburne Holidays (£55), Haulfryn Holidays (£50), Bluestone Wales (£50), Hoseasons (£45), Park Holidays UK (£44).
Which? said that Center Parcs was the most visited brand in its survey, which was released last year, and had become ‘synonymous with activity-packed kid-friendly holidays – at a price’.
The experts added: ‘Set in hundreds of acres of woodland – an environment described by one guest as ‘idyllic’ – there are wildlife trails, ziplines and water sports aplenty.
‘Rainy days are also well catered for with the indoor tropical pool, spa treatments and in-village shopping. You also awarded its comfortable lodges and luxury treehouses the full five stars.’
But they continued: ‘The problem, it seems, is the price. You told us it was ‘second mortgage’ expensive, particularly during school holidays.
‘With guests paying around £70 per person, per night on average, it’s only slightly cheaper than first-place (and all-inclusive) Potters.
‘Plus – other than the pool, trails and play areas – just about everything else costs extra. As a result, Center Parcs scored just two stars for value for money, with many of you complaining of long queues and a ‘scramble’ to book activities too.’
The overall Which? verdict said: ‘Quality lodges with every sort of activity for kids and active adults. But the price is too high, according to its guests.’
However this perception of a high price does not seem to be putting off visitors, with Brookfield claiming the chain hosts more than 2million guests a year with 98 per cent occupancy.
Brookfield bought the UK resort group from US firm Blackstone for £2.4billion in 2015, and it is thought to have been looking to sell on its investment since last year.
Investment bankers appointed by Brookfield are claimed to have been speaking over the past week to potential buyers which include other private equity firms.
Who owns Britain’s holiday park sites?
- Center Parcs – Brookfield (Canada)
- Haven Holidays – Blackstone (USA)
- Away Resorts – CVC Capital Partners (Luxembourg)
- Butlins – Harris Family Trusts (UK)
- Aria Resorts – CVC Capital Partners (Luxembourg)
- Park Holidays UK – Sun Communities (USA)
- Parkdean Resorts – Onex Corporation (Canada)
- Coppergreen Leisure – CVC Capital Partners (Luxembourg)
- Warner Leisure Villages – Blackstone (USA)
- Pontins – Britannia Hotels (UK)
The owners are trying to cash in on Britain’s staycation boom that began during the pandemic, and it also comes as they returned to profit after lockdown rules eased.
Experts said today that there is interest from US lifestyle brands and private equity groups wanting to get a foothold in the UK outdoor adventure-based holiday market.
They added that any new owner of Center Parcs is likely to want to improve facilities, but it could also mean pricier holidays as they seek to recover their purchase price.
Many UK holiday park chains are already owned by foreign private equity groups – such as the Bourne Leisure brands Haven Holidays and Warner Leisure Villages, which were bought by New York-based Blackstone for £3billion in January 2021.
Away Resorts, Aria Resorts and Coppergreen Leisure were all bought in sequence by CVC Capital Partners of Luxembourg in 2021 – in June, August and December of that year respectively.
In addition, Parkdean Resorts was bought by Canada’s Onex Corporation in 2016 for £1.35billion; while Sun Communities of Michigan purchased Park Holidays UK for £950million in April last year.
There are few remaining UK holiday park chains owned by British companies – although these do include Butlins, sold to its former owners the Harris family for £300million last September; and Pontins, owned by Britannia Hotels which is based in Hale, Greater Manchester.
Brookfield is now seeking to raise between £4billion and £5billion from the sale of Center Parcs.
People swimming in the pool at Center Parcs Sherwood Forest in Nottinghamshire (file image)
Paul Charles, chief executive of travel consultancy The PC Agency, told MailOnline today: ‘Center Parcs is a very impressive, mass market, lifestyle brand and has grown successfully in the UK in recent years.
ANALYSIS: Prices for breaks in high demand school holidays could now shoot up further
Holidaymakers appear to have fallen back in love with the great British break, but risks remain to sustained growth particularly as the lure of the overseas trip is strengthening post pandemic.
Any bidder would want to be confident that it can add further longer-term value to the Center Parcs chain which is likely to mean selling off some real estate assets in the group and potentially reinvest some of the proceeds into upgrading facilities at the most popular parks.
This could see prices for some breaks, particularly during high demand school holidays, shoot up further.
Consumers also appear still willing to pay some hefty prices for add-ons like luxury spa treatments, ringfencing budgets for expensive treats and this may still be seen as an area of under-tapped potential.
Parkdean Resorts ditched is plan for a sale earlier this year, amid economic uncertainty, but with expectations that interest rates may be near a peak, and forecasts of cuts to come next year, private equity firms might be more inclined to borrow to invest in a slice of parks business.
Blackstone, which took over Bourne Leisure and still has Haven holiday resorts in its stable may be an interested party but may be cautious given Center Parcs is being priced post its pandemic boost and it’s unclear how the holiday trade will evolve.
Susannah Streeter is head of money and markets at Hargreaves Lansdown
‘The owners want to take advantage of the enormous demand we’re seeing for family-focused, outdoor and adventure-based holidays and sell at the top of the market.
‘There is much interest from American lifestyle brands and private equity groups in particular to have a slice of the growing UK market.’
He added that for consumers, it ‘should only be good news if there is a new owner’, explaining: ‘They would likely invest further as part of any sale, and improve facilities markedly across the various Center Parcs sites’.
Mr Charles continued: ‘A sale would also give a fresh impetus to senior management and incentivise them to build the brand further.
‘Of course, the downside is also that it might mean higher prices for holidays there as the new owners seek to recover their purchase price.
‘The good news is that this highlights the high demand for family-based holidays in the UK, as there are some fantastic luxury and mass market sites available.’
The Financial Times reported that the sale of Center Parcs would include £2billion in existing debt, which is likely to appeal to interested parties given that raising new financing would be tough amid current market anxiety.
Center Parcs runs five holiday villages in the UK and one in Ireland, drawing millions of visitors to its forest locations and offering accommodation, together with activities such as water sports, quad biking and tennis.
It was originally part of a Dutch business, which opened its first site in the UK at Sherwood Forest in Nottinghamshire in 1987.
After adding further sites, the UK arm was spun off and floated on the stock market in 2003 before Blackstone bought it in 2006, and then sold it to current owners Brookfield in 2015.
The firm’s real estate was independently valued at £4.1billion last month.
And Susannah Streeter, head of money and markets at Hargreaves Lansdown, told MailOnline that some of its real estate assets could be sold off in the event of a successful bid.
She said today: ‘Holidaymakers appear to have fallen back in love with the great British break, but risks remain to sustained growth particularly as the lure of the overseas trip is strengthening post pandemic.
‘Any bidder would want to be confident that it can add further longer-term value to the Center Parcs chain which is likely to mean selling off some real estate assets in the group and potentially reinvest some of the proceeds into upgrading facilities at the most popular parks.
The Center Parcs site at Woburn Forest in Bedfordshire is among its five locations in the UK
‘This could see prices for some breaks, particularly during high demand school holidays, shoot up further.
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‘Consumers also appear still willing to pay some hefty prices for add-ons like luxury spa treatments, ringfencing budgets for expensive treats and this may still be seen as an area of under-tapped potential.’
She added that Parkdean Resorts ditched is plan for a sale earlier this year amid economic uncertainty, but with expectations that interest rates may be near a peak and forecasts of cuts to come next year, private equity firms ‘might be more inclined to borrow to invest in a slice of parks business’.
Ms Streeter added that Blackstone, which took over Bourne Leisure and still has Haven holiday resorts in its stable, could be an interested party.
However she also said Blackstone may be cautious ‘given Center Parcs is being priced post its pandemic boost and it’s unclear how the holiday trade will evolve’.’
The Center Parcs sites in the Republic of Ireland and UK have been open since April 2021 after the pandemic had forced them to close.
Brookfield’s investment in Center Parcs since its acquisition has included £100million on tech upgrades alone.
Revenues for the year to April 21, 2022 hit a record £503.4million and profits returned to the black, with a £245.6million haul following a Covid-induced loss the year before.
Waterside Lodge accommodation at the Center Parcs site in Elveden Forest, Suffolk
Profits were £66million last year, up from a loss of £157million the year before.
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However it scrapped plans to build a brand new resort at Worth Forest in West Sussex earlier this year amid a backlash from wildlife campaigners.
The £5billion price tag is double what the resort was bought for in 2015, and could make the sale the biggest real estate deal this year.
Gervais Williams, head of equities at Premier Miton, told BBC Radio 4’s Today programme this morning that private equity had previously been a ‘big beneficiary of falling interest rates’.
He said: ‘If we think back in 2015 when this business was acquired, it was bought for about £2.5billion.
‘And a lot of that finance was actually raised by low cost debt and it was a relatively cheap way of funding a large business.
‘Clearly with inflation the cost of debt has now increased and therefore you can’t have as much and it’s more expensive. And now the price of the business has gone up, the valuation has moved up, it’s more difficult to finance now with inflation.
‘And I think that’s going to be a common pattern. Clearly global inflation is peaking out at the moment, it may not be there for ever, but it’s going to peak, kind of returning, in our view.
One of the five Center Parcs sites in the UK is at Longleat Forest near Warminster in Wiltshire
‘And these private equity businesses we think are going to struggle to finance some of these kind of acquisitions at the same kinds of levels they did in the past.
‘So I think we’re going through a period of revaluation now, the same way we’ve had with stock markets around the world, and Center Parcs is just a good example of that coming through now.’
Last year, Center Parcs faced a backlash after it said its five UK sites would close from 10am on September 19 for 24 hours ‘as a mark of respect’ for the funeral of Queen Elizabeth II. However it later made a U-turn after a backlash from guests.
Brookfield – which is chaired by former Bank of England governor Mark Carney – has so far declined to comment.
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