The death of retail may be the best thing that ever happened to gym owners.
As retailers close, malls are desperate for tenants, paving the way for gym owners to find a deal on real estate.
“Retail’s demise isn’t hurting us,” said Ben Midgley, CEO and co-founder of Crunch Fitness Franchise. “It’s a big boon for our industry in terms of the availability of space.”
In Manhattan, the number of available storefronts increased from 129 in the first quarter of 2016 to 213 in the first quarter of 2017, according to a May 2017 report from real estate services firm CBRE.
And that increase in supply has led to a drop in rent prices. The average asking rent in Manhattan has decreased 21.1% since 2014, and CBRE also said that landlords are doing everything they can to lure in tenants.
“Landlords are offering additional tenant incentives, allowances and free rent periods,” according to the report.
And it’s not just Manhattan. As many as 324 department stores will close in 2017, turning about 36 million square feet vacant, according to a study from JLL Research.