PADEL OPERATORS IN THE UK, BY DEFAULT, BECOME REAL ESTATE DEVELOPERS.
This is a fact that operators seem to accept, one they have to accept. When a new sport arrives in a country, there are no existing facilities, so what are your options?
Whether an operator wants to develop outdoor or indoor courts, they have to take on the world of real estate development. They need to become proficient in the worlds of planning, leases, architecture and construction. It can be daunting.
With demand in the UK being as strong as it is, and supply still lagging behind, it is easy for a new operator to adopt the Field of Dreams attitude of “build it and they will come”, and up to now, in some ways this has worked as a strategy. This won’t be the case forever. In fact, the industry has already seen failing centres due to lack of planning for longevity.
As the industry matures, players will become more discerning. When they have choice, they will want to play at the best padel clubs and operators need to consider what this means.
As in all sectors of real estate, the old adage of location, location, location holds strong. The most visionary operators will consider location not only in terms of simple population but also wider demographics, competition and planning constraints. Choosing the right site is just the beginning but a very important beginning.
Planning the structure of your lease to allow maximum flexibility is crucial. The commercials of the lease (rent or profit share or a hybrid model) are obviously important but there are many other elements such as security of tenure, rent reviews, alienation, ability to make alterations, car parking etc that can become a problem in the future if not considered properly from the outset. Whilst some of these considerations may not seem so important now, they do support real value which in turn will attract future investment. They will make your business stand out against others when the institutional investors and family offices decide that the industry has proven enough resilience in the UK and they want to join the party.
The planning system in the UK is the one that I hear most operators complaining about. Yes, it may be complicated, and it can be frustrating at times. But operators need to put that real estate developer hat back on. Navigating the planning system takes patience, understanding and investment. Getting the best design team around you is crucial. Consultants who are responsive and who find solutions rather than identifying the problems will give you the best chance of planning success. Planning consultants, architects, ecologists, drainage, acoustic consultants, lighting consultants, highways experts all have a part to play. They all produce information which interact in a connected way and ultimately informs your final design.
Managing these consultants is like conducting an orchestra, you need a conductor who can pull all of these together to into a scheme and a planning application that can stand up to the rigors of the planning system. My advice, find someone with this capability. As an operator you will have plenty of other things to be managing, recruitment, booking apps, coaching, programmes etc. You cant do everything.
Watch out for follow up parts on:
Getting construction right and
BNG – a minefield for leaseholders.
