Launch Trampoline Park in Warwick, RI with Rob Arnold
Guest: Rob Arnold
Topics: Launch Trampoline Park, Launch Franchising
Transcript:
Chris Ressa 0:02
This is retail retold the story of how that store ended up in your neighborhood. I’m your host, Chris Ressa. And I invite you to join my conversation with some of the retail industry’s biggest influencers. This podcast is brought to you by DLC management. I’d like to thank one of our sponsors, retail openings and closings.com. In today’s dynamic retail landscape, tracking openings and closings before they take place has never been more important. Having this intelligence is an undeniable competitive advantage, retail openings and closings.com also known as Rock Tracks, future openings and future closings, comprehensive, accurate and reliable the rock is your crystal ball and the key to making well informed decisions with confidence in today’s evolving retail climate.
Welcome to retail retold. Today we have Rob Arnold. Rob is the CEO of launch trampoline parks. They currently have 31 locations open and 14 plan to open this year in 2020. Welcome to the show, Rob.
Rob Arnold 1:24
Good morning. Thank you for having me, Chris.
Ressa 1:27
Yeah, man. So Rob, why don’t you tell a little bit about you have this trampoline park business got started. And you guys have had some awesome growth and
go from there? Sure, sure.
Arnold 1:39
So it all started on a rainy day in Florida on vacation. We’re actually down in
Yeah, yeah, exactly. All great ideas. You know, so we do back in 2010 or two, sorry, 2011. My wife and I were on vacation with with my kids at the time. They were very young, I believe four and about 18 months. And we, you know, taken our first Disney Vacation down to Orlando. And there we were, I had a rainy day. And instead of being that family that decided to walk around Disney with those silly ponchos on we my wife jumped online and was looking for indoor entertainment. And so we happen to stumble upon with a called a trampoline arena. And, you know, I can make the story very long or very short, but I think the short of it was we said that looks awesome. You know both my wife grew up as a gymnast competed in gymnastics and she was a pole vaulter. I grew up rollerblading, you know, X Games type type things. And so we spent a lot of our childhood on trampoline. And so this I think, very selfishly, not so much for the kids. But for for ourselves. This was the first business that we came into, that we didn’t look at the financials, first we looked at this is awesome. Rhode Island needs one of these. And so a quick trip to one of these trampoline arenas back in the, in the back of an industrial warehouse, quickly spiraled into the dream of launch. So it’s, it was very cool, very, very clear was that. That was 2011. And I must start by saying, I walked in, I thought it was pretty cool. We started jumping. Within five minutes, my wife was the one that looked at me and said, We need to open one of these. And I said, You’re crazy. And five minutes later, I looked at her and I said, you might be onto something. So it was really my wife that was the driver behind this. And so I gotta give her the credit.
Ressa 3:50
And awesome. And what were you doing before this?
Arnold 3:54
So I had a construction company. I had about 15 guys working for me doing light commercial and high end residential. My wife owned a gift shop down in Wakefield, Rhode Island. And so we were always right out of college and even in college, you know, we were always entrepreneurial, always opening businesses buying properties, things of that nature. So but yeah, construction was the was was supporting us and I love construction. I still love construction. I dabble from time to time. And
Ressa 4:27
yeah, that turned into family entertainment somehow. So I think one of the things that entrepreneurs struggle with that you seem to get right in a short amount of time.
And there’s a lot of things that we all find challenges, but one of the things I find interesting is that you got into the franchising model pretty effectively pretty quickly. And you know, a lot of groups like they wait till they get to 2030 locations. ends may be more, they really have trouble accessing the community of investors and entrepreneurs that want to be in franchises. And they’re competing with all these other franchises. How did you get moving into that model
and be so successful in that model? So quickly?
Arnold 5:20
You know, it’s interesting, we, before we were, as we were doing our research, you know, we were actually interested in being franchisees, because we already had businesses up and running, and we were already busy doing other things make this as an investment. You know, so we, so we went around, and we were looking at the other franchises at the time that were available. And, you know, we looked at this and said, you know, this really, we did not align with any of the CEOs, they seem to be a warehouse model, you know, no video games, no junk food, no, you know, nothing else at all seem to be birthday party room, warehouse, concrete, floor, trampolines, check in desk, and that was it. And so the vision didn’t aligned. I think a lot of the early trampoline parks said, Hey, we are fitness, we’re not entertainment. And so there was a kind of a little confusion as to what a lot of them thought, you know, what industry they thought they were in. And so from day one, we always, we always said, you know, we want to be Chuckie Cheese on steroids. So, so anyways, we felt we felt as though even before the first unit open, we said, you know, something, let me let me go. I got very interested in franchising, just going through the process of looking at some of the others that were already established. And so I went to a franchise conference prior to the first unit being opened, and started taking classes. And the funny thing is, I sat in the seminar, this two day seminar with a group of people who all had five units, or seven units or three units. And they came to me and they looked at me and said, Yeah, how many units do you have? I said, zero. Everybody in the room, kind of like, Yeah, who’s this guy? What a joke. And I said, like, you know, I’ll be back, you know, but just just wait, I’ll be back. And the interesting thing I actually, you know, I didn’t, I didn’t necessarily have access to, you know, large investors are this, you know, this, this network of people. Well, we started off doing was we open to corporate locations first. And then while we’re opening our second location, we started franchising with friends and family. So my father was our first franchisee. And then, they, my business partners friend down in Delaware was our second franchisee. Our marketing guy at the time, was our third franchisee, and then my father opened a second unit. So really, we didn’t read it. Even though we started as a franchise started franchising, we didn’t go to market with the opportunity for a couple of years, we really wanted to make sure that we got our systems squared away. And, you know, we worked with friends and, you know, friends and family first because we felt as though they they’re gonna at least be honest, and let’s not, you know, let’s not take somebody else’s investment in, you know, build this with somebody that we don’t know, until we know that this is this is locked down, and we feel comfortable, we can support the support the business.
Ressa 8:07
Got it? Very interesting. And so, pre pandemic, there was, you know, this huge growth of trampoline parks what, you know, what, give America some perspective, what what drove this growth there was, you know, they were they were expanding everywhere, and seemingly, they were doing success, they were being successful. What spurred this growth, in your opinion, not just of launch, but of the industry.
Arnold 8:36
I think the the, the fact that it was something new, the fact that, you know, starting as trampoline parks, I don’t know, a single kid that doesn’t love a trampoline. And then when you attach 100 of them together in one room, it’s like, you know, again, it’s a serious wow factor. So I think there’s a newness to it that everybody grasped on to, like any concept, it hit all the major markets first. And in some major markets saturated instantly.
Ressa 9:11
It was, there’s just
Arnold 9:13
something super fun about being a part of it. I think that where things started to get a little sloppy was, you know, like I said, over saturating major markets, and then going into markets that might have been secondary or tertiary, tertiary, and there might be two or three in a small market and people starting to compete. And I think that there was there was some there’s very interesting early on that before the concept was really proven. The early model was to pick the biggest cheapest warehouse you could find and put a park in there because it was so new and because it was so exciting. You didn’t need frontage, you didn’t need to be in these great retail locations. And so you would have family taking 10 lessons Seven rights to the back of an industrial park, to a place that has, you know, 30 parking spots, and there’d be 200 customers in there somehow finding way to park around the neighborhood or industrial park getting in there. It was just, it was a true destination. And when people sat back and looked at that, they said, you’re paying $3 a square foot on rent, and you’re at capacity all day, every day on the weekends. And, you know, they’re just, you’re just printing money, it’s just huge margin. So, obviously, the financial factor drives it. The, the early model was pretty easy. Like I said earlier, trampolines, check in desk, and party rooms. And that was it. Nobody was making their own food. Nobody had video games, nobody had any real elaborate, you know, sound systems or AV systems set up, it was very, very
Ressa 10:49
simple. So you mentioned, you know, the cash piece. And that’s, that’s what happened in the yogurt phase. It was a cheap cost of entry and pretty profitable when, in, you know, right after the recession, when there was a fro yo guy in every center. Right. So, yeah, that’s what happened, right is inexpensive to get in. And it was pretty profitable business, you know, until it got oversaturated. And it was kind of a fad. Obviously, we still have frozen yogurt,
I guess. Yeah. You know, what? Is it good trampoline park doing volume in the US what’s like, obviously rent and cost of labor, all that matters. But what’s like, what kind of numbers you know, is like an average in the United States for trampoline parks.
Arnold 11:36
So interesting. You talked about the yogurt. You know, I think that that thing, kind of trying to relate trampoline parks to yogurt, but you know, very simple model. Anybody can get into it for low cost you could come in the operation is pretty simple. What what happens with trampoline parks is that if you didn’t evolve into we’re now at launch entertainment. So we started out to launch trampoline park, we’re now launched entertainment. And so what what has happened is we’ve had this evolution over time that all right, we were trampolines, video games, simple food. Now we have evolved into bowling, arcade, VR, trampolines, climbing features, you know, we have a fast casual restaurant, we’ve got a bar that’s going in some locations right now. So it has really evolved into into something bigger and better. When it comes to unit economics, I would say that you’re down and dirty trampoline park across the United States is averaging about 1.1 point 6 million for just a plain trampoline park. When you get into something, what we would call our generation two, so what what separates our generation two is a fast casual restaurant inside pizza restaurant, a full redemption arcade, and then either laser tag or another, you know, sizable feature in there outside of the, the obstacles that we can charge for good unit is is up over $2 million. And then our what we’re calling our Gen three has now to model one is you know, 20,000 square feet approximately, Model Two is 27 to 30,000. Gen three is now 32 to 50,000 square feet. And those are those are grossing roughly 3.5 to 5 million. Wow. investment levels are very different across the board, though you’re talking, you know, we’re not even doing the Gen ones anymore. It doesn’t make sense. And I hate to say this, but you know, the original trampoline, we say trampoline parks are dead. It’s the original model. If you haven’t evolved, you are going to die. And just like any retail, any retail that you see out there that isn’t able to keep up or evolve. It’s just it’ll go away. So that’s been our that’s been our big pushes, making sure that we’ve always got fresh attractions. we’re innovating. We’ve got access to new technology and making sure that our franchisees are implementing these things so that they are growing instead of dying.
Ressa 14:07
And so what what, how much has the investment changed from gen one to Gen three.
Arnold 14:13
Originally, we were sitting around 1.2, the 1.5 million approximately gen two came in around two to two to two five Gen three depending on what you’re putting in your your 3 million to 4.5 million. Our flagship location in Warwick Rhode Island now we just built a brand new one is 44,000 47,000 square feet 12 lanes of bowling VR and the whole nine. I think we are into that for about four point.
Let’s say 4.24 point 3 million won our honor. And so
Ressa 14:53
I think I know what you’re gonna say based on what you just said. But to those who, too. years ago, we’re saying and I’m using air quotes, trampoline parks were a fad, an RF fad. What’s your response to
Arnold 15:06
that? I think generation one. The trampolines are not a fad. The trampoline portion is build. And I think everybody still comes for the trampolines primarily. But if you don’t have anything else to bring to the table, you’re just not exciting anymore. Because there are so many options out there. And there’s so many trampoline parks out there. If you’re not bringing something different. You’re not going to win. You’re not going to win the race. Yeah. And I think that, yeah, the trampolines are not a fad trait. Kids love the trampolines. And you will still on a Saturday, see a main court of trampolines full of kids. So it’s just you’ve also got a an arcade full of kids and a laser tag for the kids as well now, so it’s a little different.
Ressa 15:55
Yeah, I would probably say that. Indoor entertainment is not a fad. And I think the name trampoline park probably needs to evolve. And that’s the maybe the challenge to the the naysayers is that clearly indoor entertainment is not a fad. That is a staying power. And that’s what you know, that’s how you’ve changed from watch entertainment. So
Arnold 16:18
yeah, I think family, family entertainment is here to be you know, we always look at it, and we say, you know, people will always spend money on weddings, pets in their kids, no matter whether they have money in their pocket or not. And so, you know, while we we’ve always said, Oh, we’re pretty recession proof, we may not be pandemic flu, but we are we felt like we were recession proof. Whereas somebody will always find a way to spend 20 bucks on their kids. And as long as you provide a great fun, clean environment, they’re,
Ressa 16:47
they’re going to come to you. So let’s talk about pandemic proof. And we’re at a point where we’re potentially going to, you know, there’s some states that are reopening and we’re in the reopening world, you know, what’s your guy’s outlook on people coming back to the, these indoor entertainment venues?
Arnold 17:10
Interesting, it’s, you know, it’s funny, I think, up until I tried to get a pulse from, you know, all of our franchisees in different states, their, their network, some of their customers, we’ve sent some surveys out to see what some customers are saying, what they’re thinking what they’re feeling, you know, regionally, it is very different. So, in the northeast, it seems like people are a lot more scared than people down south. And, you know, I think that, unfortunately, it’s become a political thing. And, you know, and, and it’s, there’s a lot of fear sitting in people right now. But we’re looking at and saying, you know, I think that what I’ve noticed in the last couple of weeks, we’ve been on full lockdown mode, you know, based out of Rhode Island, we’ve been on full lockdown mode. And, you know, I take my son over the baseball field, and now I’m starting to get the other baseball dad saying, you know, what, we’re done, we’re ready to come out and play with you, Rob, you know, you know, we’re, we’re lengthening our leash. So I think, you know, some people are starting to think that this has been silly, and they are ready to come back and join crowds and, and play games, be outside, be inside, whatever, whatever it might be go back to restaurants. And there’s still another portion of the population that is still petrified, they’re going to sit back and say, You know what, I think they’re going to need to see that people can go back out into public, not get sick, and just give it a little bit of time before they come back. So what we are anticipating, is a slow build up from the time that we open, you know, and we’re guessing it’s probably going to be about a 40% decline, and from projections. And probably over the next eight to 12 months, we’ll slowly build back up too close to where we were, I don’t know if we’re gonna get back to exactly where we were. But I’m hoping we’ll be back at about 90% In the next eight to 12 months. And is there anything
Ressa 19:05
you’re doing to you know, obviously, if the two camps you have the stir crazy camp that probably going to rush out to get out of the house and then you have the the cautious camp that as you called, you know, and wants to see make sure nobody gets sick, all that stuff? In particular to you know, speaking to that camp, do you are you doing anything in do you have anything planned in the parks to make the
consumer feel safe and, you know, do some physical things to to increase safety in the locations?
Arnold 19:41
Sure. Yeah. So we what we’ve done, we’ve actually, you know, I think it’s always best for us to err on the side of caution. You sidetrack a little bit. I’ve learned I learned a lesson back back when we first opened back when we first opened the Rhode Island Park and I don’t know 2012 We had a blizzard come through. And it was uh, you know, they always warned us about blizzards, you know, and they always call it you know, every, you know, you get six inches they were calling it a blizzard here in Rhode Island. And so I put a post out on Facebook because we had, you know, 50 parties that weekend or 100 parties with some crazy weekend it was the middle of February. And we put a post out I did I’ll own this. And I put a picture of our our logo. Our mascot is a kangaroo. And I put a picture of a kangaroo in the snow. And I the Post said Blizzard smothered launch will be open tomorrow at 1pm. So the next morning, I went out and I was shoveling my neighbor’s driveway. And all of a sudden my neighbor came out with her iPad, and she said, You guys are getting crucified online look at all of this bad press. And it was sure enough, there were 200 comments, you guys are evil, I can’t believe you’re making people come out or you know, you’re not canceling birthday parties, whatever. So I think we learned early on that perception is everything. And you know, we need to err on the side of caution. And so when this all happened, Blizzard schmetzer was going through my mind and we said you know something, we are better to close early, close fast. Let’s let’s shut everything down. And so with the reopening it’s Blizzard committed still in my head as well. You know, when you come in and you bring your kids into into enjoy the park, they usually get jump socks. This time we’re handing out jump socks with a it’s a cool launch, I’d say I call it a face mask was more of like a sporting neck gator. So we’re going to start by handing the customers all you know sports these these sporty neck gators so that they’re so that everybody feels comfortable. It’s not a you know, big silly face mask, it’s something that’s cool that kids love it. You know, our in our eating areas, we’re going to, you know, views every other table, customers considered every other table, bowling lanes will be every other lane, trampoline capacity will be severely decreased when we first start. And then we we’ve always been huge on cleanliness. I mean, if you’ve been in our parks, and you know, you’ve got one in your spot and death for death, I mean, we’ve always been spotless, we’ve always used anti microbial cleaning agents, we have this electromagnetic fogging machine. So that that seals everything up. And I think added cleaning procedures, decreasing capacity, providing face masks, providing, you know, extra staff to just go around and constantly clean behind everybody. We’ve tripled down on our hand sanitizing stations. So it’s really, you know, I think Perception is everything and making sure that we’re, you know, on on top of it, and
Ressa 22:42
that’s providing face mask is the first one I’ve heard that’s doing that. So that’s great.
Arnold 22:48
Yeah, I think if I think a lot of kids, you know, people think, Oh, this might be silly, or a lot of people think it’s great. But if we can make it cool, then let’s make it cool. You know, at least the kids that we will have different, you know, different colors, all the birthday party kids will be getting. Um, so I think it’d be something cool for all these kids to run around with some, you know, cool launch branded face masks. So it’d be fun to make it fun.
Ressa 23:11
Very, very neat. And are you going to open when the government’s allow? Or are you doing it differently?
Arnold 23:19
A little bit differently. We are. So we leave actually, we have the green light to open in Georgia. And we have a couple locations down in Georgia. What we are doing is against negative Blizzard blizzard in my head and the negative press, you know, I think we need to let let this blow over for a little bit. Let other people open. Let the crowd start to feel comfortable. And then we’ll have a three to four week kind of tail behind with a slow and very careful opening. So I believe that our first locations that a plan to open we’ll be in Georgia. Again, I think we could have opened this this past Friday when we’re under certain circumstances, but we will be opening I believe it’s the week of the 17th May 17. So we’re gonna give it three or four weeks, let it blow over and actually reevaluate. We may not even open then we just need to reevaluate and make sure that everybody’s starting to feel comfortable. You know, because in our world, you know, if we can’t have 100 people in there, we can’t make money, we might as well be closed because we’re just we’re just throwing money away anyway. So we just we need to make sure that we are we’re able to safely bring the capacity in and and make sure that everybody feels comfortable. So we’re gonna give it a little we’re gonna give it a little time.
Ressa 24:39
Got it. All right. Well,
you know, one of the premise of this show that was great color is the story behind the deal. And you have an interesting story about how your,
your first location opened in Rhode Island. And what time was that in? Warwick Rhode Island in more work, why don’t you? Why don’t you tell us how that happened.
Arnold 25:06
So interesting. We had, you know, after our trip to Florida in so the first few days in Florida we had we went to the trampoline arena, first week of Florida. The second week we were down in Florida, we spent the whole rest of the time trying to map out where we would go and, and what this place was going to look like when we when we got home. And we knew that, you know, the busiest retail corridor on Route two is route two, and Warwick is I believe 80 something percent of retail tax dollars in the state of Rhode Island come from Route two. Everybody knows, everybody knows route two, everybody goes shopping there. We first tried an old CompUSA there was a price right in there that shut us down. And so this was the first commercial lease we ever signed. And we’re sitting here going, you got this 30,000 square foot building, why don’t you want us and we just didn’t understand.
Ressa 26:05
You needed a waiver, there was a restriction in the lease and they wouldn’t let you in. Right?
Arnold 26:09
Yep, I had no idea what that was. I just thought the landlord was so stupid that they wouldn’t let us in. Right, so So then we went across the street and there was a furniture store. And we actually signed an LOI for the upstairs, where was their bargain? Their bargain center was gonna be about 24,000 square feet. sign an LOI, we started designing. And then the owner pulled the plug on us. Right at right at least signature. So he said, No, I don’t, I don’t want to do it. Now I don’t, I don’t feel safe. Now, this is crazy. This is dangerous. We’re not doing it. And oddly enough, we ended up down the road. And there was an old Sports Authority location, this is Sports Authority was still in business, they had just moved down the road and downsize went from a 42,000 square foot location down to a maybe a 10 or 8000 square foot location. So were they severely downsized. And we ended up splitting the building with Planet Fitness. So we each took, you know, 20, approximately 20,000 square feet. Planet Fitness was on one side and launchers on the other and ended up making great use of a Sports Authority building. The thing, the crazy part of this story is that, you know, Sports Authority, so Sports Authority was still our landlord. And then Sports Authority leased from the it was a sub, it was a sublet from, from Sports Authority to us. And here we are five years into it, cranking and you know, rocking and rolling, or four years into it. And all of a sudden, we get this note saying Sports Authority is claiming bankruptcy. And you either need to pack your stuff, or buy the building, or lease the building. And they had leased the building for some exorbitant amount of money. And we were in there for about half the price of what Sports Authority was paying. And it forced us to move we we tried to strike a deal. And And the funny thing is we we just rebuilt went to our generation three Park, which is about a half mile down the road back at that original furniture location that we started with that they pulled the plug on us. So it’s kind of a funny circle of events that had happened there. Wow, that is
Ressa 28:24
fascinating. So you were subleasing from Sports Authority. Sports Authority, the
aisles. So
you’re new to like renting in the commercial real estate game. And you went up a complicated way which is you have to sublease from from sports. Yeah, versus a direct lease with the landlord. And so you sublease it from Sports Authority they file? And so at that point, what were you what what did what was your next step did reach out to Sports Authority of the landlord directly
Arnold 28:58
reached out to the landlord because obviously, the the landlord was the one that sent us landlord was the one that sent us the letter and said, Hey, listen, you know, I think Planet Fitness and launch combined, we’re paying about 450 Gross. On the space, Sports Authority was paying 850 I think the landlord built that built the whole thing out for them, and they just pay this monster rent for the space. So the Delta was, hey, you guys need to come up with the other $400,000 Some way somehow or pack your stuff. And he was tough. He was uh, you know, this guy out of Chicago. You know, was involved in the waste hauling business. So, you know, he was a tough guy, and he was hard time. And we tried to actually buy the building. We ended up losing the bid to Ocean State job lot. And then we ended up ultimately having to move down the road.
Ressa 29:57
Got it, so it
didn’t work out. Did you did you? It didn’t work out you couldn’t reach terms?
And what was the was it just rent? Is that what the issue was?
Arnold 30:11
At first it was rent. And then the landlord said that he was not he wasn’t no longer interested in owning the building. So he went from we ended up paying a holdover rent. Yeah. I mean, you said, you said it earlier. You know, I was new to this. This was a crash course. I mean, we went from, you know, walking into CompUSA saying, why don’t you want us to, you know, a couple years later, getting our first eviction, because, you know, Sports Authority is out and, and here we are saying, Oh, my gosh, what do we do? And what’s holdover? Rent? And what what do you mean, you we you’re collecting 50% more just to keep us in there for now. And so we ended up paying a holdover rent for a period of time until we could until we could lock down our next space and build our build our space down the road. And it it was a, it was a little tricky, is definitely stressful. And I think, you know, one thing, one thing I can add, I’ll add a little color to it is that when we opened the first unit, you know, my wife and I ended up with we was a lot more expensive than we thought it was going to be coming into the, into the venture, we had $80 left in our bank account when the first unit opened. So we had some incredible success early on, which was great, but then here we are three or four years later, telling us to telling us to get out of the building. And I think the lesson learned there was, you know, at the time that we signed it, nobody would ever thought that Sports Authority was going out of business. So why why would we even think, oh, this could be a problem down the road. But had I sign that a year before Sports Authority went out of business, I would have lost everything. I would have lost everything, I wouldn’t have made my money back in time I would have would have completely crippled my family. So it’s lessons learned and making sure you dot your i’s, cross your t’s. And, you know, and make sure you’ve got good real estate attorneys on your side that are headed. Make sure you cover your butt. It could have been devastating.
Ressa 32:11
Wow. And so how were How long were you closed before you reopened?
Arnold 32:18
We shut it down in September of 2017. And we reopened March of 2018.
Ressa 32:26
So well, six months. Got it. And did you have any other open franchises? franchisees at the time?
Arnold 32:35
We did? Yep. So we our first our first actual franchise was was my father was our first franchisee 2013. And then he was our sixth unit in 2015 2016 is when we really started coming out of the gates and really pushing the franchise opportunity to people outside of friends and family. And so 2016 was was a big push and really from then on has just Yeah, growing leaps and bounds every single year.
Ressa 33:05
Got it? Well, that’s a great story. I’m really fascinating. And for those who don’t know, holdover rent is when the term has expired. And but the tenant does not leave the space. It is a increased rent. They’re holding over past the term as a motivation and incentive to either exit or renew the lease depending on what the parties want to do. So anyway, for those who didn’t know.
Well listen, Rob that was one of the more interesting stories really fascinating, great lessons learned true bootstrapped entrepreneurial story so thank you for that I
think everyone will find that interesting. Last thing on that the sublease Did you negotiate with Sports Authority or the landlord
Arnold 33:54
with so I’m going to add another layer I even simplified it so here here’s how this would happen. Landlord Sports Authority Sports Authority to Planet Fitness franchisee Planet Fitness franchisee to watch so we had Layer Layer Layer so there was multiple sub leases in there so when we came in you crazy right? So he came in we actually subleased so the Planet Fitness franchisee leased the entire sub leased it from Sports Authority and they only needed 22,000 And they leased the remainder of the space to us wow yeah. Oh yeah, we dice that thing up but it was great I mean, we were both did planets no no. Planet no they moved down the road as well. I mean, we
Ressa 34:45
ocean state wanted to put in their store.
Arnold 34:49
Yeah, they Yeah. And then crazy enough. We got beat out on the bid by job lot. During their due diligence period, we signed a deal down the road. Yeah. And then Home Depot actually shut down the Ocean State deal because it’s a condo Plaza and Home Depot’s in the same space or same area, and they shut down the Ocean State deal. So somebody else ended up buying it. But it’s uh, yeah, it’s it just deals are changing very, very quickly. But yeah, we we missed that we tried to buy it we were going to stay launch and Planet Fitness and we were going to go in the building. We talked about buying the building together, but it just unfortunately, I think, fortunately it did work out because we that was our generation one park, as great as stressful as it was to move down the road. And as great as it would have been to stay there. I think that what this did was this really pushed us to build our next generation and really make sure that the Warwick Rhode Island Park or home based flagship was the model going forward. And so we didn’t want to do it. But it was probably it worked out for the best in the long run, because it really set the tone for all the new franchises opening.
Ressa 36:05
From here on. Fascinating. Fascinating. All right. Well, that was an amazing story. Thank you. Yeah, really cool. The last part of our show. We call retail wisdom, three questions.
Arnold 36:23
Tell me when you’re ready, you’re out. Okay. I’m ready. Let’s do this.
Ressa 36:26
And for those who don’t know, a lot of people know the questions beforehand. Rob doesn’t. So question one. Best piece of commercial real estate advice for those listeners out there?
Arnold 36:38
Oh, my gosh, I think I’ve I think I’ve spoken a few lessons in my own here. I would say if I can, if I can throw two in there, like number one would be make sure. Make sure you understand the market very well. Make sure you understand the demographics, traffic patterns, and make sure that the anchors in if you’re going into a plaza, making sure that the anchors are solid businesses that I won’t say Amazon proof but we feel are going to be around for a long time. I think it’s we often see a good deal and want to jump out a deal. And next thing you know the positives are starting to die around us. And we now have a dead zone. Number two is is making sure. Again, making sure you’ve got a solid real estate attorney dotting the i’s crossing
the t’s for you. Got it. Okay. You don’t you don’t know what you don’t know.
Ressa 37:40
Or second question. Extinct retailer, you wish would come back from the dead.
Arnold 37:46
Lot of good ones out there. I want to go back to childhood though. Where? Maybe you can maybe you can remember Friday night, Saturday night? Where would we go as kids?
Ressa 38:00
Believe you guessed that one. Where would we go his kids went to the local football game, but
Arnold 38:07
they go even younger. Right? So my thought is Blockbuster Video. There was something very cool about going in wondering if your movie was going to be available or not. And I don’t know I think you know, we’ve got instant gratification now and things that have right to your phone or Netflix or whatever. But you know, there was just something really cool and fun about going to Blockbuster Video and looking at all the movies. They had the new releases you had the old ones for that were a little bit cheaper. So it’s pretty cool. I love blockbuster. Awesome.
Ressa 38:46
All right, last question. So a little retail fun. So one of the top hiking boots out there. Okay, is the Timberland trail waterproof boots. Okay, I am on tactical gear.com What are those boots? retail for? You could give me the sale price or the true the actual retail price
Arnold 39:15
sale price I’m gonna go I like that like timberland. I would say sale price 6995 full retail 109 On
Ressa 39:26
sale price. 9375. full retail. You’re closer. 114 95. Thank you for playing okay.
Arnold 39:34
I always wanted to be on prices, right? That was watch that show when you are home sick from school. So this was if this is the closest I’ll ever get. I appreciate that. Thank you. Awesome.
Ressa 39:45
Well, listen, Rob, I really appreciate you coming on. Fascinating story. Really good insights on post pandemic. I think this is really great and the listeners are gonna get a lot out of it. Really appreciate it.
Arnold 39:56
And good luck out there. Thanks. I appreciate you. got me on and I just, you know, throw a little DLC plug. I mean I love I love. We get to talk from time to time. It’s always great talking to you. And, you know, I know there’s a lot of you know, it’s a landlord tenant relationship is always tough. We’re not always tough, it can be tough. And you know, you’re one of the few guys I really enjoy talking to I know you guys are just stand up property owners, landlords and, you know, we appreciate everything you’ve done. And you know, obviously, we’ve got a lot of rodeos left in our life and a lot of deals to be made in the future. So thanks for having me. And, you know, keep crushing it. Appreciate it.
Ressa 40:38
You too. Thanks, Rob. And listen, man, I need anything give me a ring.
Arnold 40:43
All right, you got it. Thank you.
Ressa 40:44
Thank you. Thank you for listening to retail tools. If you want to share a story about a retail real estate deal that you were a part of on our show. Please reach out to us at retail retold at DLC mgmt.com This show highlights the stories behind the deals from all perspectives. So it doesn’t matter if you’re a retailer, broker, entrepreneur, architect or an attorney. Also, don’t forget to subscribe to retail retold so you don’t miss out on next Thursday’s episode