The Post-COVID-19 Future of Fitness Centers
As economies shut down in 2020, gyms and fitness centers were forced to adapt by providing at-home fitness options. Melina Cordero, Managing Director of Institutional Properties and Retail of CBRE Group, states that "the same thing happened to fitness that has happened in virtually every other category of retail, which is omni-channel." The shift to a blend of digital and in-person options was certainly escalated in 2020, but many of the larger fitness chains already had online offerings in the works. Now, as states continue COVID-19 vaccination efforts, experts are debating whether fitness centers will return to pre-pandemic ways or if they will need to innovate.
Some media outlets found strong evidence that at-home fitness routines may be here to stay due to the investments individuals made during 2020 to exercise at home (e.g purchasing expensive equipment), but others found that 75 percent of consumers said they would return to pre-pandemic routines, including physically going to a gym. Additionally, Cordero found that the markets that have started reopening more aggressively have seen a strong propensity from consumers to return to the gym in-person. Even with optimism for reopening, online training was projected by the American College of Sports Medicine as the No. 1 trend in fitness for 2021.
Post-pandemic, Cordero predicts different markets will see variable responses. Boutique gyms may become a less attractive option for consumers as they are often at a higher price point than large-scale gyms. As many retail establishments closed down, Cordero points out that large-scale gyms have an opportunity to take some of that space. For example, some populations are transitioning to the suburbs, which creates more prospects for new fitness centers.
Additionally, Cordero expects that safety and hygiene adaptations for COVID-19 are likely to continue for the long term, but gyms will return to pre-pandemic occupancy on a gradual basis. Due to the health benefits of such adaptations, Cordero predicts that the configurations and demand of size will stay largely the same for large-scale gyms. However, one fitness center stated that its gyms will reduce their storefronts. Others believe that fitness centers will need to innovate by providing more amenities and other community value to maintain memberships.
Another impact on the future of fitness centers will be trends with office workers. In more urban areas, it is a growing trend for an office building to provide a gym as an amenity to its office tenants. Cordero explained that "sometimes people have gym memberships next to their office or sometimes people have memberships next to their home ... So now if we’re shifting to a model that is more flexible, where the majority of people are working from home a couple days a week and working in the office a couple days a week, that will also change the habits or frequency at gyms." Like Cordero, several experts agree that the likely result is a mixture of in-person and virtual offerings, which can be adapted to fit individual needs.
For more information or questions, contact the author of this alert or another attorney in Holland & Knight's Real Estate Practice.