Sports Entertainment Provides a Promising Future for Retail Real Estate
ATLANTA — The future of food and beverage retail is…sports? To hear from “The Future of Restaurants & Entertainment” panel at the ICSC Southeast Conference & Deal Making event, sports-centric concepts are a solid bet for retail real estate owners to pursue going forward. Produced by the International Council of Shopping Centers (ICSC), the event was held Nov. 13-15 at the newly renovated Georgia World Congress Center in downtown Atlanta.
Justin Amick, president of Painted Hospitality, spoke during the panel about his two venues in Atlanta, The Painted Pin and The Painted Duck. Both locations have an industrial motif and offer an expanded dinner menu, craft beer and cocktails and classic parlor games such as shuffleboard and horseshoes. The differentiator, though, is the boutique bowling alley.
Amick said the idea is to attract patrons with the games and provide an experience while making money via food and beverage.
“Painted wasn’t the first to invent the high-end bowling concept — the first to do so was probably Lucky Strike — but with our model of gaming, food and beverage, dancing and sports all under one roof, we do it well,” said Amick. His company recently announced a second location of The Painted Pin at the upcoming $900 million Revel mixed-use project that North American Properties is building in Gwinnett County.
Blending sports entertainment with food and beverage is nothing new, but it’s gaining steam. In addition to bowling concepts like Painted, Pinstripes and Punch Bowl Social, golf concepts such as Topgolf and Drive Shack are actively expanding across the country.
S.J. Collins Enterprises recently inked a lease with Puttshack at the developer’s upcoming $450 million mixed-use development in Atlanta’s West Midtown district called The Interlock. The golf concept comes from Steve Jolliffe and Dave Jolliffe, founders of Topgolf and World Golf Systems, and Adam Breeden, founder of Flight Club, Ace Bounce and All Star Lanes.
Additionally, Delaware North and Braves Development Corp. recently announced a concept called “Good Game” coming to The Battery Atlanta, the mixed-use village surrounding SunTrust Park. The venue will house seven Topgolf Swing Suite simulator bays, as well as a restaurant and bar.
Amick said it’s important for real estate owners to look at an operator’s track record and also keep in mind to provide complementary uses to avoid saturation. Another thing for owners to keep in mind is that some sports uses take up a good bit of real estate, which can hurt the bottom line in the long run.
“Bowling and shuffleboard have traditionally taken up a lot of space, and ping-pong or darts used to be in a small space in the back of the bar, but now you need 10,000 square feet dedicated only to ping-pong or pickleball or darts,” said Adam Williamowsky, director of Streetsense’s restaurant division. “From a real estate perspective just be careful when trying to do something that’s never been done before in that much space.”
Esports, sports betting
Retail concepts aren’t the only way in which real estate owners can leverage sports to its advantage, according to the panelists. A growing industry globally is esports, or organized multiplayer video game competitions.
“There’s a concept out of the Midwest called Gameworks that is doing esports venues, tournaments, sold sponsorships, online viewing and 2,000 people can be there onsite,” said Williamowsky. “We worked on a project in Oakland with CIM Group. They built a 7,000-seat esports arena. It’s not a fad; it brings mass amounts of people.”
The panelists said that there is an international appeal and a groundswell in the younger generation for esports competition. Adam Schwegman, partner and senior vice president of leasing at North American Properties, pointed out that the finals for the League of Legends gaming tournament attracted three times the viewership of the 2019 NBA Finals, thanks in part to online streaming via Twitch and YouTube.
“It’s real and it’s growing,” said Schwegman. “The average age of the NFL viewer is 50 years old. For esports, it’s 28.”
And it’s not just retail landlords that are feeling the positive momentum of esports. Envy Gaming Inc., a gaming company that owns several esports teams, recently leased 20,872 square feet of Class A office space at Victory Park in downtown Dallas as a training facility for its gamer clients.
Another trend that the panelists are keeping their eyes on is legalized sports gambling. Following the Supreme Court ruling last year in the State of New Jersey’s favor of legalized betting on college and professional sports, many states are moving to legalize sports betting. These include Illinois, Maine, Montana, New Hampshire, North Carolina and Tennessee, which all have bills on the docket to legalize sports betting within their borders.
“These sports books are going to be huge. Companies are going to make their money on the food and beverage, mainly beverage,” said Williamowsky. “The gambling itself is the entertainment. The bet is no different than throwing a bowling ball down an alley. There’s going to be a huge opportunity, depending on how the major sports leagues handle it. Apparently, the next NBA season you’ll be able to sit in your seat and bet on whether Steph Curry makes a foul shot.”
As host city of the ICSC Southeast event, Atlanta spent plenty of time in the spotlight during the various panel discussions. The show featured a panel entitled “Atlanta, the Metropolis of the South” where executives from three prominent local developers (Carter USA, Selig Enterprises and Jamestown LP) highlighted their firms’ projects and discussed the metro area’s unique drivers that have helped propel new development.
Additionally, the developer’s panel highlighted CIM Group’s upcoming Centennial Yards project that will revive downtown’s Gulch area, and Halcyon, a $370 million mixed-use development by RocaPoint Partners that opened in October in nearby Forsyth County.
Centennial Yards was a fixture at the ICSC event as CIM Group used it as a backdrop for a display outside the exhibition hall. The installation featured pamphlets about the project, coffee and a specialty “donut wall.”
Shannon Crowell, vice president of development of CIM Group, said that in addition to the project’s expected 9 million square feet of office space, Centennial Yards will also include 1 million square feet of retail space centered around the underserved patrons of downtown events such as concertgoers and fans of local professional teams including the Atlanta Hawks, Atlanta Falcons and Atlanta United.
“Most people arrive shortly before a game and leave immediately after. There’s not much to do in the current environment before and after games,” said Crowell.
Phil Mays, principal at RocaPoint Partners, said that his firm’s Halcyon project is a direct result of the growing trade area of Atlanta’s northern arch. According to the U.S. Census Bureau, the city of Atlanta’s population has grown nearly 17 percent between April 2010 and July 2018. The Atlanta Journal-Constitutionreports that the metro area’s population growth ranks No. 4 among major metropolitan areas nationally between 2017 and 2018.
“Forsyth County is consistently ranked as one of the fastest growing counties in Georgia,” said Mays. “The community needed a mix of experiential offerings and amenities that it previously had to travel to neighboring counties to enjoy. Halcyon is the answer to the community’s need for relevant offerings that fit the local lifestyle, allowing the project to thrive long-term and serve as a model for suburban mixed-use.”
— John Nelson