The boutique fitness scene is pushing out mid-tier players, snapping up a growing number of leases and churning out serious cash for commercial landlords.
The number of leases signed for Manhattan gym and studio space more than doubled last year to 22 from nine, according to deals tracked by Cushman & Wakefield. And a number of larger gyms are getting in on the lucrative boutique fitness action, partnering with smaller studios and offering them temporary or permanent space, and in some cases giving boutique customers access to their own amenities. The big guys are attracted by the potential foot traffic from the typically well-off clientele boutique studios tend to attract, and who often lend a significant chunk of change to the landlord’s bottom line, according to Forbes.
“They are already covering 12 percent of our total rent and we are only eight months into the deal,” Howard Brodsky, CEO of DavidBartonGym said of the 4 Astor Place location’s lease to a two-year-old cycling studio called CYC Fitness. “We project that in 2015, CYC will cover between 16 percent and 22 percent of our total rent.”
On a national scale, boutique fitness spots earned more than twice as much per customer than commercial health clubs in 2013, according to data from the International Health, Racquet and Sportsclub Association and Club Intel cited by Forbes. The industry, the report found, is divided into three segments: The first two are comprised of commercial fitness-only spots and nonprofit gyms like the YMCA, which collectively make up 80 percent of facilities in the U.S., while the third is made up of boutique spots, which constitute roughly 20 percent of the market. [Forbes] — Julie Strickland