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Fitness centers taking over neighborhood shopping centers

By Maria Halkias, The Dallas Morning News
Published: March 16, 2024, 5:57am

Dallas must be working up a sweat if the fitness industry is pumping out commercial retail real estate stats for the record book.

Last year, fitness alone accounted for 25 percent of the 1.8 million square feet of retail real estate leased in Dallas-Fort Worth. Fitness usually accounts for about 10 percent, according to Dallas-based commercial real estate firm Weitzman.

What’s fueling it? It’s almost like grocery shopping. There are one-stop shops, but some consumers go to several grocery stores to get their weekly shopping done.

Today, it’s not unusual for a family to belong to the YMCA and to have at least one other full-service membership because the teens want the must-be-seen-at gym and the parents each have a favorite boutique fitness concept.

Northwood Retail owns the 169,000-square-foot Hillside Village shopping center in East Dallas. It’s anchored by Sprouts Farmers Market and houses three small fitness concepts — F45 Fitness, Haven and Sessions Pilates.

“A lot of people like the small gym classes,” said Ward Kampf, president of Northwood Retail. “We put a Juiceland next to Haven. It all fits together.”

Fitness entrepreneurs have created demand with their atmospheres, from the music to the lemon water to specialized offerings for strength or cardio and generating feelings of belonging to a like-minded community.

Concepts from boxing, yoga, Pilates, stretching and cycling to big full-service options are filling former grocery stores and empty smaller spaces in Dallas-Fort Worth’s neighborhood shopping centers. Some are places to be seen; others are viewed as a bargain for the multiple fitness options.

New entrants to the market and others that are actively backfilling include EoS Fitness, Fitness Connection, LA Fitness, 24 Hour Fitness, Planet Fitness, Crunch and Club 4 Fitness. Smaller boutique concepts with multiple locations include F45, Sessions Pilates, Club Pilates, Haven, Stretch Zone, Studio 6 Fitness, Pure Barre and Orangetheory. SculptHouse has a single location combined with a workout apparel and shoe store.

Gym, health and fitness clubs were a $31.2 billion business in the U.S. in 2023, but that represented a 6.5 percent decline over the prior five years, according to IBIS World, mostly during the pandemic when facilities closed. The business is back on an upswing.

Bob Young, Weitzman’s executive managing director, calls the fitness expansion a game-changer that’s filling in space left vacant by the pandemic.

“Grocers had restricted big gyms in the past (because of parking), but that started going away in 2020,” Young said. “Fitness was another form of daily need. Now everybody wants it in their center.”

Weitzman is helping EoS Fitness find locations such as the 184,000-square-foot Addison Town Center on Belt Line Road, where it’s going in next year. The shopping center is anchored by Target and Kroger.

A Tom Thumb in Plano gave up 10,000 square feet that Weitzman is trying to lease to a fitness concept. Young believes the pandemic-era fitness habit isn’t a fleeting trend.

“Consumers are saying, ‘We want more places to work out and near me, convenient to me from work or home,’” Young said.

Texas growth

Eos Fitness was founded in 2014 and moved its headquarters to Farmers Branch from Carlsbad, Calif., in 2022 to better execute on plans to have 50 locations — each about 40,000 square feet — in Dallas-Fort Worth and Houston by 2028.

Three locations opened last year in Euless, Fort Worth and Desoto and six in the Houston area. Two more will open in Plano and North Richland Hills this year and one more in Sugar Land. Next year, seven locations are planned in both D-FW and Houston.

The EoS Fort Worth location is bigger at 60,000 square feet and has a dedicated space called The Set with equipment, custom art installations and lighting that fitness influencers and anyone else can use to create content for their social media feeds. EoS has three levels of membership starting at $9.99 a month.

“Texas is one of the fastest-growing fitness markets in the country due to the overall growth in the state,” said Dave Reiseman, chief growth officer at EoS.

“We’re looking at Dallas and Houston that have a lot of aging and outdated product where we can come in and do well,” said Reiseman, “and beyond into places like Prosper that don’t have a fitness player.”

EoS took a former 24-Hour Fitness in Euless down to the studs, he said, and now it has twice the membership of the former gym. The DeSoto location was an Albertsons.

It’s not unusual to take over a former grocery space, he said: “Grocers pick good sites.”

You can go to the YMCA

The YMCA of Metropolitan Dallas knows the trend means new competition, said its CEO Curt Hazelbaker. The Y regularly renovates its facilities to house new classes, bring in new equipment and add pools “to stay on trend,” he said.

“Creating healthier communities is part of the mission of the YMCA of Metropolitan Dallas, and we’re constantly innovating to make our great member experience even better,” Hazelbaker said in a statement.

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The YMCA invested $16 million to rebuild the Park South Family Y in southern Dallas, $2 million to update spaces at the Semones Family Y, and $13 million to renovate the Lake Highlands Family Y. The Lake Highlands location has new smart technology called EGYM, which automatically customizes workouts based on an individual’s biometrics.

“Part of our mission is to serve all, so financial assistance is available for almost every YMCA program. Our deep community connections through service are the difference,” Hazelbaker said. “There are plenty of gyms in North Texas, but membership at a Y is an investment in your own community.”

Demand for fitness extends to upscale customers as well.

“Everyone is claiming wellness. For sure it speaks to the cultural moment we’re in,” said Mark Rivers, CEO of Fort Worth-based Canyon Ranch. “We’re a holistic approach and may be why we’ve been around for 45 years.”

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