During the summer, VITAL Climbing’s rooftop rock wall attracts as many as 100 members at a time to climb, watch the sunset and sip beers in the gym’s cafe.
“People don’t just come to the gym to climb,” said co-founder Nam Phan. luck“They’re there to meet other people, interact and climb together. That solidified our design approach.”
High-end gyms, like other health clubs, were left in the cold by the coronavirus lockdown, which forced many to give up their memberships. In addition to setting up home offices, fitness enthusiasts have set up garage gyms and ordered Peloton bikes. All at onceBut in recent years, high-end clubs have seen their customer base boom again, and many of them don’t just return for the barbells.
“Changing travel patterns”
Life Time opened its first club in New York in 2016. Eight years later, the company has 12 locations across the city, either already open or in development. Its newest location, Penn 1, is located in the heart of Manhattan and boasts more than 50,000 square feet, featuring seven pickleball courts, multiple training floors, a bar and a cycling studio.
Lifetime Co., Ltd.
While memberships at Planet Fitness and Blink range from $15 to $40 a month, Life Time’s cheapest membership in Midtown starts at $269, and if you want access to the pickleball courts, it’ll cost you another $60.But Life Time doesn’t just sell gyms.
The first floor of Pen 1 features a lounge area overlooking the court, where members can sit after a workout, answer emails, or pour themselves a draft beer from a bar-style tap in the corner. Further up a flight of stairs is a recovery area, where members can use Life Time massage chairs and pneumatic compression sleeves, which look like giant blood pressure cuffs that wrap around their arms and legs.
Lifetime Co., Ltd.
Parham Javaheri, the company’s chief development officer, said: luck Life Time creates a complete health and wellness experience that keeps members coming back to their facilities far more than a typical fitness club.
“We’re changing travel patterns,” he said. “If you go to Life Time 12 or 13 times a month, you’re more likely to stop there and shop, get groceries, get whatever you need on the way to and from Life Time.”
Top quality real estate
Customers aren’t the only ones who have a new appreciation for all that high-end gyms have to offer.
The rise of remote workers has created problems for commercial real estate. Earlier this year, the national office vacancy rate surpassed the 20% threshold for the first time in history, according to a Moody’s analysis. In New York City, the value of office space is expected to fall 28% by 2029, translating into a loss of about $50 billion for the city.
But for high-end gyms like Life Time, the city’s vacancy problem opens the door to prime real estate, and developers are taking notice, Javaheri said.
“We’ve got great real estate and a great developer coming into the heart of Manhattan,” he said of Penn 1’s new facility. Runners on the second-floor treadmills can literally watch the NBA team get off the bus and enter Madison Square Garden. “They could have rented it out to a lot of other users, but what they wanted was an amenity that people would use and covet.”
Top-notch gyms don’t just help commercial real estate make more money: In Henderson, Nevada, Life Time Living offers exclusive memberships to a 162,000-square-foot club just feet from luxury apartments. Mr. Javaheri says Life Time has brought higher rents per square foot and improved tenant retention to the residential project.
Life Time Work, which has 15 locations across the U.S., will open a new 110,000-square-foot club in Brooklyn Towers that will complement its curated co-working spaces with conference rooms, open workspaces and private phone booths.
“When we did the Brooklyn Tower deal, we had some vacant office space,” Javaheri says. “We showed the developer the Lifetime Work concept at the time, and it was a no-brainer for them.”
A few years ago, the overall picture was bleak. Like hotels and restaurants, gyms struggled during the pandemic. Between March 20, 2020 and December 31, 2021, 25% of health and fitness facilities in the U.S. were closed. Report from the Health and Fitness Association.
But as the US emerged from lockdown, gyms that managed to hold on have seen people furiously hitting the weights and treadmills again. ABC Fitness reported that there were 184 million gym check-ins in the first quarter of 2024, up 60% from the same period in 2023 and nearly double pre-pandemic levels.
Young people have played a key role in the fitness industry’s recovery, with Gen Zers, who are more focused on their physical health than any other generation, accounting for nearly a third of new gym memberships, according to ABC News.
Rick Caro, president of Management Vision, a consulting firm focused on the health club industry, and a former board member of the Health and Fitness Association, said: luck Health clubs have always been strong anchor tenants for commercial real estate. Gyms regularly draw patrons looking for a return on their investment. Gyms help revitalize surrounding retail, and employers like to be near health clubs because they often offer group discounts that incentivize employees.
“What’s exciting right now is the cleverness and creativity with which people are taking this time-tested fundamental principle and doing it in slightly different or unique ways,” Caro says. “They’re doing it with a variety of concepts, at different price points and in different sized venues.”
VITAL’s co-working space was born naturally
“This is a historic opportunity for our community,” said Ron Rubakin, senior vice president at CBRE. luck Rubakin was contacted by VITAL Climbing, a high-end bouldering gym, about five years ago when the gym was considering expanding into Brooklyn. When the club opened in 2021, the majority of its members were “male” between the ages of 18 and 30, Rubakin said.
While VITAL’s monthly membership fees aren’t as steep as Life Time or Equinox, they still cost Williamsburg members $145 a month. Members have 24/7 access to VITAL’s facilities. In addition to climbing, there’s weight training and cardio equipment, a slackline, a sauna, and a second rooftop rock wall with Manhattan skyline views and a heated fire pit.
There’s also a lounge-like area that stretches from the entrance to the rock wall on the first floor, and Rubakin said that while it’s not technically a co-working space, it still encourages members to stay longer than the average workout.
“People work out, then go climbing, then take a shower, then get back on their laptop,” Rubakin said, “and then maybe three or four hours later they take a break and run on the treadmill. It’s a very unique situation.”
The fan said luck VITAL was never intended to be a coworking space, but rather it grew organically. Unlike older climbing gyms, which tend to be in secluded industrial parks, VITAL is in the heart of Williamsburg. It’s close to people’s homes and already has open space readily available. Eventually, people started bringing their laptops and setting up computer monitors.
“The post-COVID mindset aligned with what we had already built,” Fan said. “People were working from home more and craving community, and Vital was there at the right time.”
A “Golden Age” of Expansion
While the new fitness clubs opening in the city are great, finding the space Life Time and VITAL facilities need remains a challenge. Most Life Time clubs in New York are around 50,000 square feet, and VITAL in Williamsburg is about the same size, Javaheri says. That’s compared to the 15,000- or 25,000-square-foot spaces that smaller gyms tend to occupy.
VITAL is opening a new location on New York City’s Lower East Side that will be roughly the same size as its Williamsburg club. CBRE’s Rubakin said the new Essex Crossing location is the second suitable location he’s found for VITAL in the five years he’s represented the firm.
“A lot of the buildings that could attract those tenants and bring people back just don’t have the space,” Lubakin said. “Imagine your average office building. It’s not designed to house 50,000 square feet of something.”
Still, Javaheri said Life Time is in a “golden age” of expansion as the space they need becomes more available and developers take notice of the anchor presence a luxury gym can provide.
“I think if it’s good real estate, good developers will look at the current downturn and see an opportunity,” he said. “They’ll see an opportunity to reclaim the space and reinvent the building. And that’s where we come in.”
