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Fitness boom proves healthy for centers, report finds

February 8, 2019

Millennials’ enthusiasm for fitness, beauty and wellness concepts is proving to be a boon for neighborhood shopping centers, according to a new report.

The concept of “self-care” — a category encompassing activities connected to physical and mental welfare — has “caught on like wildfire,” says a report by Sara Martin, a vice president at Colliers who specializes in retail and land brokerage. “The trend is also affecting commercial real estate retail leasing in a big way.”

Such tenants as Orangetheory Fitness offer membership packages that encourage multiple visits by clients

The retail sector in the Minneapolis–St. Paul market, where Martin is based, “has seen a surge in the number of leases signed by beauty, health and wellness retailers, specifically specialty brands that fill a niche,” she said. “For example, an individual’s self-care regime could include: barre class twice a week, a massage and lash extensions once a month, a manicure every two weeks and spin class on the weekends, followed by a UV sauna.”

Self-care tenants are offering memberships rather than pay-as-you-go terms to their customers, thus ensuring repeat business — and repeat visits. Such tenants include Club Pilates, CorePower Yoga, CycleBar, Orangetheory Fitness, Pure Barre, Row House and Title Boxing Club, Martin says.

“This membership pricing structure is one of the driving factors that has led to the abundance of new-to-market concepts and expanding existing specialty service providers in the metro,” Martin writes. “The guaranteed income from memberships help these groups confidently sign leases in retail leasing markets that can be affected by rising rents, operating costs, taxes and labor.”

By Edmund Mander

Director, Editor-In-Chief/SCT

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