For fans of climbing gyms, part of the appeal is the sense of spatial transformation. On the walls that tower over many of the industrial-spaces-turned-gyms that have become home to this fast-growing sport, routes to the top often change every few weeks, with hand holds and grips rotated out and reconfigured.
That feeling of change is familiar to the companies and entrepreneurs seeking to build new gyms to take advantage of the sport’s expanding popularity. Regardless of fitness trends, indoor climbing has a unique relationship with real estate due to the high ceilings and expansive space needed for new facilities. And currently, for many developers seeking to satiate the public’s desire for more vertical real estate—climbing gyms are $400 million-per-year industry in the U.S., according to a 2017 IBISWorld study—the climb has become a bit more challenging.
“Warehouse districts and industrial areas are a little bit of an older model,” says Mike Helt, editor-in-chief of Climbing Business Journal, a publication that tracks the industry. “It was cheap, big, and perfect. Developers are still looking at those areas, but they aren’t always the first choice. Climbing gyms want to be in up-and-coming, hip neighborhoods in the middle of town, places that are easy to get to.”
The number-one challenge to developing a climbing gym is real estate, says Helt, and finding the right property, one that’s both big enough for a multimillion-dollar rehab, and, in the case of facilities that offer rope climbing, tall enough—often needing 45-foot ceilings or more.
What’s been especially interesting, and in some cases frustrating as the industry grows, is how climbing’s emergence runs parallel to both the post-Recession real estate recovery and a seemingly insatiable desire for warehouses and post-industrial properties for a variety of industries, including residential and commercial development, microbreweries, e-commerce such as Amazon, and in some states, cannabis growers.
“I think the word is out on how cool industrial warehouses can be and everyone wants it,” says Lance Pinn, co-founder and president of Brooklyn Boulders, a chain of climbing gyms with four locations in the New York, Boston, and Chicago area. “Once upon a time, there was a sweet spot when it came to cost and availability. For our first few facilities, we caught them just in time. But now, that ship has sailed.”
Pinn’s first facility, which opened in a former New York Daily News garage in the Gowanus neighborhood of Brooklyn in 2009, is a perfect example. At the time, it was an available facility in a post-industrial neighborhood that wasn’t exactly booming. Nearly a decade later, new residential development, as well as commercial projects such as a high-end shuffleboard club, means that while the customer base is everywhere, building that same gym today would likely be cost-prohibitive.
That’s one of the real challenges facing climbing gym developers; Finding massive spaces for adaptive reuse close enough, or soon to be close enough, to a large customer base, but before the real estate gets too expensive.
That’s led gym developers to focus on transforming any spaces that fit the bill, no matter how unique. Everything from churches to movie theaters to a hospital power plant have been remodeled for climbers.
Earth Treks and Planet Granite, two former competitors who merged to form the nation’s largest climbing gym operator, have two projects in oversized warehouse spaces; a former Sports Authority headquarters in Englewood, Colorado, that at 53,000 square feet will be the largest such gym in the country, and a Sears warehouse-turned-bouldering facility in Hampden, Maryland, part of a larger rehab project called Union Collective that includes a microbrewery.
“When you go into a market and do a real estate search, the number of 40,000 square-foot or larger buildings that exist is pretty finite,” says Robert Cohen, the company’s CEO. “I’ve come across a lot of great historical buildings, and there are limitations to the way things are built and you just can’t put a gym into it.”
According to Cohen, 99 out of 100 times, building a new gym is going to require taking an old building with character and transforming it to fit the needs of climbers. But even when the dimensions offer hope, it’s hard to guarantee a facility will work until exploring the inside. Most lack the height, or ability to build up, as well as the column width to do the job (bouldering gyms, smaller climbing spaces that don’t require a rope or harness, offer an alternative in areas that can’t support a full-size facility).
Why not build from scratch? According to Helt, the cost for that kind of ground-up project can work, especially in smaller markets. He was part of a group that helped bring a gym to his hometown in Reno, Nevada, and due to the real estate cost and transit access—most of the Reno-area population can access the gym with just a short drive—the math worked. But to do that in larger markets would mean locating on the outskirts of towns where real estate is cheap, but customer access becomes increasingly challenging.
“Now, it’s the top of the market and the landlords have the upper hand,” says Linn. “Until there’s a correction, it’s going to continue to be difficult, since there’s so many other uses competing for the same space.”
Despite the real estate challenges, Helt and others don’t see anything slowing down soon. Interest continues to grow, and with the sport debuting in the Olympics in 2020, most expect a sizable boost. Last year, according to Helt’s count, 45 facilities opened, double the rate in 2016, and 53 have or are planned to open in 2018. Cohen forecasts a steady 4 to 6 percent increase per year, and Linn sees lots of growth potential, especially in smaller cities.
Helt believes the challenges of funding and finding a new space actually work to the industry’s advantage. It’s hard to burst a bubble when it takes so long to open a new facility. He sees opportunity in places like the Dallas and Houston metro areas, with millions of potential climbers and less penetration.
“People are looking to do something different,” says Cohen. “The whole notion of going to a gym and jumping on a treadmill isn’t as appealing today.”