In our feature, Tell Your Tenants to Shape Up, we showed you how a fitness center in your complex is a winning selling feature, can generate revenue above and beyond your monthly rents, and in this economy, it can mean the difference between having rented units or more vacancies.
In part two, Making the Most of Your Square Footage, we shared ideas on where a fitness center could fit on your rental property.Now, it’s time to discuss preparing a budget for your fitness center.
This is a big concern for landlords because we all need to be careful when it comes to spending. But spending wisely is the key.
If you have been following along in our series of articles, the homework from step 1 was to determine the dollar amount needed to renovate the space you selected. Hopefully you have done that. If the space is older, or an existing unit, you may find that the cost to remove old walls, and get rid of some carpets, etc may be expensive. But in reality, you can make that back in a very short period of time.
The amount of money you will need to invest in a fitness center depends largely on you and the physical space you have to work with. Theres something that can be done for every budget. But the more you can create a professional looking fitness center, the greater impact it will have on your bottom line.
“Equipment is usually the biggest expense,” advises fitness equipment expert Jarrod Saracco with Fitness Outfitters. “We specialize in this type of thing, so making every dollar and every square foot count is what we do best.””Typical fitness centers I see in apartment complexes are terrible,” he continues. “They might have a beat up old treadmill or elliptical machine, maybe an exercise mat and something that resembles anab bench thrown into the smallest space they could find. But in order to create a dynamic, revenue producing center in your complex, you will need to make an investment.”
Another consideration is whether to pay cash or lease equipment.
“Aggressive leasing programs are available for fitness equipment and sometimes this is a great way to conserve cash and manage it over time,” Saracco says.To give you an idea of what it may cost to outfit a quality fitness center, here is a simple scenario to work off of:
3 Treadmills 3 Ellipticals 2 Bikes 2-3 adjustable benches Set of dumbbells from 5-50lbs A few accessories like exercise balls, etc. Total: less than $30k.
“If you were to purchase all of this equipment brand new, you can easily double this amount,” Saracco says. “We can help you outfit your facility within any budget, but you need to figure out what you are willing to invest in order to make a difference.”
Your homework: establish a budget. What are you comfortable spending to make this really work? If you can allocate sufficient funds to create a sufficient space, then the next article will be of major interest to you: making money off of your fitness center.