Mike Levitt spent years operating on temporary event permits for his nightclub Ormside Projects in an industrial area of Bermondsey, south London, before he was finally granted a licence by Southwark council in 2019.
The only issue was that his license stated music had to be turned off by 11.30pm on Fridays and Saturdays — a tough ask for a dance club.
It took three more years and a complicated appeal process to receive permission to stay open until 6.30am. “As a late-night venue, it feels as if you have to prove you’re culturally important to justify a licence,” Levitt said. “A lot of other places would have given up.”
Home Office figures released on Thursday show the number of 24-hour licenses held by pubs, bars and nightclubs in London fell by more than two-thirds between 2021-22 and 2023-24, from 183 to 58.
Restrictive licensing rules, residents’ noise complaints and high operating costs are taking their toll on London’s night-time economy, leading to earlier closing times and fewer after-hours watering holes.
Referring to Levitt’s case, Southwark Council said: “We have to consider all factors when approving a licence so that we strike a balance between boosting the night-time economy with the health and wellbeing of our residents.”
The departure of London’s night tsar Amy Lamé this month has been seen by some as the latest sign of the city’s faltering night-time economy. Appointed by the Mayor’s Office in 2016, Lamé was responsible for ensuring the capital thrived as a 24-hour city.
Decisions about licensing are made at council level, explained Michael Krill, head of the Night-Time Industry Association, which represents the sector. Appointing independent, council-level representatives could improve London’s licensing regime, he added.
Many local authorities have been cautious about late-night licensing. “The issue isn’t existing venues, it’s about persuading local authorities to let new ones open,” says Dominic Madden, co-founder of the Electric Group, which operates Electric Brixton and other venues across the UK.
Councils can control the opening of new establishments by restricting opening hours, types of businesses and customer capacity in areas deemed “cumulative impact areas” — where the expansion of licensed premises could have a detrimental impact. There are now 70 across the city.
Westminster Council, for example, has a number of areas with a high concentration of late-night establishments, such as Soho and the West End, where the opening of new bars and restaurants is limited to “exceptional circumstances”. The council says the policy is meant to ensure public safety and reduce noise complaints.
Luke Elford, a partner at licensing law firm John Gaunt & Partners, said restrictions on late-night businesses had become tighter over the past few years.
“We’re meeting stiffer opposition from both the responsible authorities — the police, council licensing teams, environmental health — but also from residents who have experience in objecting to licensing applications,” he said.
Elford said flat owners had been able to sway council officials when it came to licensing decisions. “People got used to a version of London during Covid that had never existed — where things were quiet,” he said.
London’s licensing issues are deep-rooted. Although the traditional 11pm pub closing time has been pushed later in recent decades, policing of dance venues and nightclubs increased aggressively in the 1990s and early 2000s. Local authorities continue to raise violence and antisocial behaviour as a risk.
“We have a licensing history and policy mechanisms which do not favour late licensing in London,” said Alessio Kolioulis, a lecturer a University College London who specialises in the night-time economy. “Whoever is going to be the next night tsar will have to prioritise this.”
Kolioulis said some local authorities, including Camden Council, have introduced more permissive night-time economic strategies, although those measures had met resistance. “Powerful residents associations have watered down some of the proposals that boroughs have brought forward.”
Analysts have pointed to a demographic shift, with Gen Z’s more moderate drinking habits as factors in the decline of London’s bar and nightclub industry. The after-dark economy in cities such as Berlin have also struggled with declining profitability since the pandemic.
However, spending data suggests that despite the challenges there is still strong demand for late-night entertainment in London.
Figures compiled by Square, the point-of-sales operator, show the proportion of spending after midnight has increased in the capital. Purchases in bars, clubs and lounges after midnight in inner London accounted for more than 14 per cent of total spending in September of this year, compared to less than 11 per cent in the same period of 2019.
Despite the increase in spending, venue owners say they are contending with higher costs.
Cameron Leslie, co-founder of famed nightclub Fabric, noted that dance music venues were particularly energy-intensive and suffered from steep overheads. “It’s just so high-risk to open a new bricks-and-mortar venue right now.”
The owner of gay nightclub Heaven said earlier this year that its landlords the Arch Company had increased the club’s annual rent by £240,000 in addition to an automatic £80,000 increase.
Business rates and alcohol duty are weighing heavily on night-time industries, said Allen Simpson, deputy chief executive of industry group UKHospitality.
“There’s a strange, counter-intuitive behaviour in the UK where we’ve used the tax system to disincentivise community-based businesses,” said Simpson, who pointed to the steep price difference between alcohol purchased in a bar compared to a supermarket.
Some late-night operators have resorted to renting “meanwhile spaces” — empty commercial buildings owned by developers or local authorities that are awaiting future development.
Ed Holloway, co-founder of architectural consultancy Beep Studio, said the rise of meanwhile venues had become a lifeline to smaller night-time operators, such as Grow Tottenham.
However, he noted that the arrangements were often precarious and shortlived. “I’d like to see grassroots culture valued as much as residential property values,” Holloway said.
