Planet Fitness is the rare mall tenant expanding its share of commercial real estate even as many retailers—thanks to online commerce—shrink their physical footprint, The Wall Street Journal report
None of the three Baton Rouge locations are at a mall, but two have set up weights in older strip shopping centers.
“We’re glad there’s not a pill” that can replace exercising, says Dorvin Lively, chief financial officer of Planet Fitness. “It seems as other retailers close down, it opens up perfect locations for us.”
This year’s closing of children’s store chain Toys “R” Us has only contributed to a rising vacancy rate in malls, which are at their emptiest since 2013.
The vacancy rate reached 8.6% in the second quarter, up from 8.4% in the first quarter, as more consumers shifted their shopping online, according to data from real-estate research firm Reis Inc.
The highest post-recession vacancy was in the third quarter of 2011 when it hit 9.4%, Reis said.
The shopping slowdown is being felt in all types of bricks-and-mortar retail outlets throughout the country. Vacancies in open-air shopping centers, for example, increased during the last quarter in 55 of the 77 metropolitan areas studied by Reis.
“We’ve been able to take advantage of that,” says Lively. The company has been adding clubs at a steady pace, averaging 187 new sites a year between 2013 and 2017. The company has only closed 22 locations in its 26-year history, he added.
“They see an opportunity to open 4,000 stores in the U.S.,” said Michael Kawamoto, a research analyst for D.A. Davidson. “They can open 200 locations a year for the foreseeable future.”
