Crystallizing Value Creation & Market Overview
Health & Fitness (5.9% of ABR)
Illustrative Gym Rent Coverage Sensitivity
REVENUES
STAFFING COSTS
REPAIRS &
MAINTENANCE
EBITDAR
RENT
EBITDAR COVERAGE
Source:
REALTY INCOME
LIFETIM
ATHLET
FAVORABLE CONSUMER TRENDS
AND DEMOGRAPHIC TAILWINDS:
Growing market as consumers increasingly value health.
✓ Consumer surveys indicate that 94% of pre-pandemic
gym-goers will return in some capacity(1).
E-COMMERCE RESILIENT INDUSTRY:
Health clubs offer unique experiences to their members
that cannot be replicated online (i.e. socializing, amenities).
Service-oriented business model makes the core real
estate essential to operators.
ORIGINAL ECONOMICS
NEW ECONOMICS
100
50%
50
(25)
(25)
(5)
(5)
70
20
ATTRACTIVE MARGIN OF SAFETY,
EXPOSURE TO TOP OPERATORS:
✓ Average CFC of portfolio (2) allows for 40% sales drop
to breakeven.
20
20
3.5x
1.0x
✔ Top exposure is with #1 operator (L.A. Fitness, a low-cost
provider) and premium provider that performed well during
prior economic downturn (Life Time Fitness).
(1) IHRSA.
(2) Average CFC of portfolio based on locations that report sales.
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