Developers are taking notice, transforming neglected retail space into popular spots for fans of America’s fastest-growing sport – American football.
Empty big-box retail stores and vacant anchor stores in defunct malls are being transformed into indoor pickleball courts, creating what can only be described as a “pickleball gold rush” in commercial real estate.
USA Pickleball, the U.S. governing body for pickleball, reports that approximately 130 new courts are opening every month nationwide, according to USA Pickleball’s estimates. Unfortunately, that amount still isn’t sufficient to keep up with demand: according to Sports & Fitness Industry Association estimates that nearly 25,000 courts must be constructed by 2020 to keep pace with demand – this would require investing $90 million over 10 years and may include converting existing properties and large vacant lots as viable strategies to meet this need.
Since the COVID-19 pandemic, pickleball, which combines tennis and ping-pong, has seen exponential growth. Once thought to be predominantly played by retirees, an estimated 36.5 million Americans played pickleball last year–an increase of 158% since 2019. According to SFIA data, 18-34 year-olds now make up 29% of pickleball market participants.
Pickleball courts have quickly become a sought-after amenity for multifamily buildings, single-family communities and public parks alike. Unfortunately, outdoor courts have garnered numerous complaints of noise pollution and intruding upon existing tennis courts; hence more pickleball courts are moving indoors in order to allow their users to enjoy this year-round sport.
Developers are finding properties, such as recently closed Bed, Bath & Beyond stores, to house multiple indoor courts. Ace Pickleball Club, a recreational and tournament pickleball franchiser that sold 40 franchise licenses even before opening its first location this summer in Roswell, Ga. They first began offering franchise licenses back in February with plans to sell at least 100 by the end of this year and launch 50+ pickleball locations by 2024.
Pickleball is the new frontier in commercial real estate,” according to Diego Pacheco, chief growth officer for Ace Pickleball Club. Landlords love it because it attracts more foot traffic with spending power; landlords also appreciate how it helps attract and negotiate lease agreements more easily.”
Indoor pickleball venues typically fall into two main categories: 1) Eatertainment/Sportstainment venues that combine pickleball courts with dining or sports bars, and 2) Recreational facilities devoted solely to casual play or tournaments. Both categories have experienced exponential growth over the years; property owners are taking steps such as rejuvenating vacant buildings to gain early entrance to this emerging market ahead of competitors.
“With such high construction prices, it may not always make economic sense to start from scratch in building a pickleball facility for recreational and tournament space,” Diego states. Everyone wants something open up. So if you build it from the ground up and take more than 24 months for construction approval–another group could easily arrive with their own pickleball facility.”
Ace Pickleball Club typically targets vacant, second-generation big box retail space that can be retrofitted within 100 to 120 days for revitalization, working closely with franchisees to identify a space ranging between 25,000 and 50,000 square feet that can support eight to 16 tournament-standard indoor courts. The full service franchiser partners with them in finding this real estate space.
Malls that seek experiential retail tenants that draw in foot traffic are funding the pickleball boom. Camp Pickle announced this summer it had secured $200 million from investors including Simon Property Group – one of the leading owners of U.S. shopping malls – and will launch indoor facilities next year in Denver and Huntsville, Alabama.
Macon Mall revitalization project included the addition of pickleball courts as part of their revitalization strategy. A former Belk anchor store was transformed into 32 pickleball courts–regarded as one of the world’s largest indoor pickleball facilities.
Picklemall, another emerging player, recently opened its inaugural 24-court facility at Arizona Mills Mall in Tempe, Ariz., covering 104,000-square-feet of retail space as an anchor retail anchor retail anchor space and plans to expand over the next two years with locations planned in Minneapolis, Chicago, Dallas and Oklahoma City – with support from billionaire financier Steve Kuhn – one of the founders of Major League Pickleball.
“Pickleball is truly the ‘Benjamin Button’ of sports,” Kuhn declared during his announcement of a new Arizona facility. As its demographics increase every year, picking can break through barriers of age, race and class to bring people together and bring joy into our communities. That begins by being creative about location- the future is indoor pickleball!
