Pickleball pandemonium is sweeping the country, with local sports stars Larry Fitzgerald and Devin Booker signing on as owners of Arizona’s Major League Pickleball franchise. Parks around the Valley are adding pickleball courts for public use and refurbishing underutilized tennis courts to meet the demand. But Michael Pollack, president and founder of Pollack Investments, says this popular paddle sport is starting a trend of its own in the retail sector.
“A big thing in the market this last year or so has been pickleball. Everybody who has a larger space is looking at converting to pickleball,” he says. “Malls are adding things to the mix that you wouldn’t have thought of five years ago, and I think we’ll see more of that as people realize that a lot of the boxes didn’t need to be as big as they were. We’ll see more of those get carved up.”
Matthew Fish, designated broker at Prescott Commercial Real Estate, represented Espire Sports, which recently converted an old Sears in Prescott Gateway Mall into a more than 100,000-square-foot sports facility that includes 14 indoor pickleball courts. He says that pickleball is a good fit because it brings in new shoppers for the mall and is a cheaper option than ground-up construction for developers.
Projects such as Espire Sports are complex, Fish continues, since many malls have co-tenancy clauses in their commercial lease agreements that require or restrict certain kinds of users. Changing the use can also affect parking ratios, zoning and emergency access points, requiring coordination with the city.
LEARN MORE: Arizona construction: Here’s how the next normal looks
“People are willing to jump through the hurdles with the municipality because of the economic benefits of [adaptive reuse,]” Fish says. “[Other businesses in malls] have been more and more open to it because they would rather have an experiential opportunity to bring families in that will spend money in other stores instead of an ugly, cold, dark storefront.”
ESPIRE SPORTS
Jim Thomas, CEO and founder of Espire Sports, set out about five years ago to create a place to enjoy the sport of pickleball indoors. He thought about building from the ground up at first, but rising construction costs meant a price tag of $20-$30 million.
“That’s when we started looking for buildings, and it just so happened that Sears was vacant at the Prescott Gateway Mall,” Thomas recalls. “I went inside and was able to see how high the ceiling was, and it was tall enough for pickleball.”
Having enough vertical space is crucial for playing pickleball indoors, since some lob shots can easily hit low ceilings. Espire Sports also hosts tournaments, and USA Pickleball — the governing body for pickleball in the U.S. — requires ceilings to be at least 18 feet tall for regulation play. Believing that the Sears was a good candidate for his vision, Thomas spent $3.6 million on the building and invested another $3 million in renovations.
“It took us about 12 months to convert it,” he explains. “A standard pickleball court is 32 feet by 64 feet, and all the columns in the Sears building were 26 feet apart. So, we put in structural beams so we could pull out the columns, and we ended up with 52-foot spacing. The rest was fairly simple — the concrete floors made the courts easy to surface.”
With malls across the country struggling to compete with the convenience of online shopping, Thomas sees converting old big box stores — many of which have the requisite ceiling heights — as one option for reinvigorating these shopping centers.
“I believe these malls will come back as long as people think outside the box,” he says. “It could be a pickleball center, a grocery store or multifamily housing. The ship has sailed on [only having] retail, there will be some, but a mall has to have some sort of entertainment for people to come back.”
PICKLEMALL
On Aug. 5, Picklemall opened its first location at Arizona Mills — a 104,000-square-foot facility with 16 courts in the former At Home space. West Shaw, CEO of Picklemall, says he’s looking to expand into all 50 states because of the gap between supply and demand for pickleball, with some markets having few indoor or public courts available.
“Malls are just one of the classes we’re going into; we’re going into strip centers as well,” he says. “Malls are especially good because there are so many supplementary tenants. Right across the hallway from us at Arizona Mills is an Auntie Anne’s, and people want a bite to eat after they play but we don’t have food.”
Like Thomas, Shaw underscores the importance of ceiling heights for these conversions. Even though 18-foot ceilings are the minimum for regulation play, Shaw prefers more than 20 feet, with the location at Arizona Mills being 23 feet. This requirement limits the types of spaces that would make for a good Picklemall facility.
“There are many retail stores that we could go into, but they just don’t work in terms of ceiling height and column spacing,” he continues. “Would it be great to build our own facilities with perfect column spacing and ceiling heights? It would, but it’s about speed to market and capital costs. Why would you spend the money on building out a vanilla box when there are dozens, if not hundreds, of boxes across the nation? And with interest rates and development costs going through the roof, it makes no sense to do that.”
PICKLEBALL KINGDOM
Opening its doors to the public in May 2022, Pickleball Kingdom’s first location in Chandler is a 40,000-square-foot facility with 15 courts, locker rooms, showers and a pro shop. Ace Rodrigues, founder and CEO of Pickleball Kingdom, says speed to market makes adapting retail locations an attractive option since demand for courts is so strong. That said, Rodrigues notes that the market is still in its infancy.
“We’re not just creating a brand, we’re helping define the industry itself,” he continues. “As I see it, there are several lanes that people are jumping into. You have the entertainment venues such as Chicken N Pickle that are, at their core, sports bars. That’s their ‘entree’, but you can also play pickleball. At Pickleball Kingdom, our ‘entree’ is pickleball, and by the way, you can get a beer or grab something to eat.”
Within the category of pickleball-centric facilities, Rodrigues explains, there are stripped-down versions that aren’t a lot different from a public court besides being indoors. He sees membership at Pickleball Kingdom as a more robust offering because of the amenities offered beyond an air-conditioned place to play. Rodrigues is confident in the model that he has built and has already started franchising the business.
“My original plan was to build five locations in Arizona, then start to franchise, but the market spoke,” he says. “From day one we had people asking about when we would start franchising. I knew from the beginning that we’d franchise, so we built it with a model that could be scaled and replicated.”
Today, three franchises are already under construction or in the demolition process, another dozen are in the process leading up to construction and approximately 30 others in the negotiation phase.
“We have some [franchises] that are going to be ground-up builds, but the majority are going to be retrofitted spaces, whether they’re strip malls or commercial spaces,” Rodrigues says. “Depending on city ordinances and parking, we’re going to have locations in light industrial buildings as well, which are good because demolition is easier and lease rents are typically cheaper.”
Adding to the brand’s strength is that Pickleball Kingdom is launching a reality competition show that began filming in September. Eight men and eight women are being flown into Arizona to compete for one of two professional contracts, along with a chance to win a franchise based off audience votes.
