N E W M AR K V AL UAT I O N & A DV I S O R Y
National Multisport Industry Analysis Market conditions that influence the subject property are discussed in this section. The major factors requiring consideration are the supply and demand conditions, which affect the competitive position of the subject property. Although multisport facilities are market specific, this section of the report provides an overview of national market trends that influence demand for multisport structures in the subject’s market area. Our analysis includes excerpts and information from the 2020 IBISWorld Industry Report: Gym, Health & Fitness Clubs in the US.
OVERVIEW OF SPORTS COMPLEX FACILITIES Sports and entertainment multiplexes, or sports complexes, are a massive concept by the standards of a single or joint development party, but one which can be financed and supported within a handful of phases. The United States is host to thousands of single or dual-use sport or entertainment-oriented facilities (sports complexes, tennis clubs, soccer facilities, ice arenas, service cinemas, etc.) many of which ended up being unsuccessful efforts from the early stages of operation. The idea may have been sound at some point prior to construction of these projects, and they may have even been operating at near-capacity levels for some time. As stand-alone going concerns, each of these facilities often stands a far less convincing chance at achieving sustainability. But in an increasing number of circumstances, it is the larger, expansive, and more diverse projects that have yielded returns to not only investors, but also tax jurisdictions through ripple spending by the patrons. According to Trading Economics, consumer spending in the U.S. will remain stagnant until 2022 but is projected to increase by about three percent in 2023. Looking back several years, these growth figures were bleak and did not lend credence to the possibility of developing large-scale discretionary income-supported projects like sports complexes. If a development plan was ever to come to fruition, the chances are that the scope had been reduced, thereby narrowing the opportunity for the project to attract from a larger feeder market. Much like a regional shopping mall, sports complexes and entertainment venues exhibit significant flex in the trade areas they draw from as the magnitude of the project increases or decreases. As additional phases are implemented, those concentric rings swell rapidly. When phases are removed, patrons will not travel long distances to pay for the experience.
ECONOMIC IMPACT CYCLE Real property can be compared to a wheel and fission, particularly when large-scale projects are undertaken near a stable feeder market (people: fuel, gravity) and those which are developed using sound-minded economics at play. When mega sports complexes and other sports and entertainment-related endeavors are spawned, they are oftentimes thumbed by governmental agencies seeking ways to expand its own tax base (see first phase in graphic below). As in all capitalist environments in the world, the communities that enjoy healthy tax revenue levels tend to be those with more diverse arrays of businesses. These businesses depend on the presence of ancillary amenities to support the workforce, its dependents, and the consumers. But at
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