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CRE Opinion: Fitness Is a Strong Anchor

Health clubs have plenty to bring to the table when power centers include them as tenants.
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John Zikos of Venture Commercial Real Estate.

I have represented LA Fitness for more than 14 years in Dallas-Fort Worth, and for more than eight years in Austin and San Antonio. Over that period of time, we have secured sites for nearly 60 new clubs.

More recently, I have had the opportunity to sell some LA Fitness facilities as investment sales properties. When I started working with LA Fitness, they told me that they wanted to be in prominent locations in power centers. They told me about the huge number of daily trips their clubs generated and what a great co-tenant they were for a shopping center. They explained their peak parking times, and how they meshed well with many other retailers. They also discussed the multiple weekly trips they generated with most of their customers.

Over the 14 years, the amount of actual cross-shopping customers did after their workout has also skyrocketed, with the advent of fashionable workout apparel and other shifts in society. While I have come to understand that LA’s claims about fitness and its place in retail centers has great merit, it has been wonderful to see the industry start to embrace them as well.

There is probably no retail business out there that is less susceptible to the internet than a fitness center. I have had meetings with the chief real estate officer of LA Fitness pitching them as a good co-tenant and have had tenants that have been opposed to allowing fitness in a center, and these same tenants have come around completely.

We have data showing significant upticks in sales for other tenants once LA Fitness opens in a center. I actually get calls from retailers asking me if I can bring LA Fitness to shopping centers in which they are considering new locations. There are few, if any other categories, that bring more people to a shopping center with a higher frequency than health clubs. With a majority of LA Fitness members being female, the clubs are even more attractive to the typical tenant mix of a shopping center.

What was once an uphill battle to get LA Fitness into a shopping center has now become a pretty easy sale. And who can’t use an easy sale these days!

John Zikos is principal and managing partner at Venture Commercial Real Estate.

 

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