Monthly Archives: January 2025

Now more than ever, we need places for people to congregate and connect. With every lifestyle, regional, and community center showing big empty spaces from tenants that have gone dark (due to Covid-related loss) or just bad management and strategy, innovation is the key to rebranding and renewed   Covid has been catastrophic for business with major shutdowns and the explosion of e-commerce.

But some things can’t be replaced, and I believe will never be replaced, such as the need for connection and communal gathering places.  The isolation and emancipation screens bring for young and old elicits a more urgent need for human contact.  As good designers, developers and owners, we can provide interesting, exciting and innovative experiences, and we can bring visitors back to our shopping centers.

The genres of new concepts are as old as the shopping centers themselves and as new as technology will allow.  Here are some of the notable Location Based Entertainment (LBE’s) we think are reinventing the genres.

Eataly

Eataly is the delicious Italian gourmet food market/food court on steroids, with 10 locationsin the United States, including New York and Los Angeles.

Eataly is a global operator in Italian food, offering a concept combining high-end Italian food restaurant with retail.

Eataly’s business model was built around the “eat-shop-learn” concept, offering consumers globally a selection of high-quality Italian restaurants and retail experiences with an overwhelming variety of the finest Italian local “specialties” often impossible to buy abroad.

Eataly operates 27 directly operated flagship stores (14 in Italy, 10 in North America and 3 in Europe) and 26 franchised stores located in the Asia Pacific countries and Middle Eastern region, generating revenues of over €800 million globally (including franchise store sales).  This indicates average store sales of £15 million per location.

Eatertainment and Sports

I hate the word Eatertainment, but it has become common in our lexicon.  The concept involves combining eating and drinking with fun, sports and games.  Anything from baseball to golf to bowling to curling (yes, curling!) are tapped to be themes for these venues, which fit nicely into a retail or mixed-use project.

The first class includes many new restaurants which offer simulators for popular sports such as golf and Formula 1 car racing. Top Golf is the most popular sports themed venue with the highest number of units and top grossing sales per unit of the new sports/food/beverage concepts.  This concept combines golf simulators and games with food and beverage.  The company offers more than 100 plus units with total sales of almost $1.8 billion, average sales per unit of $17-$18 million on newer units sized at approximately 65,000 square feet.  Gross margins are known to be about 40%, indicating an EBDITA of $6.8 million.  With an industry standard payback of four years, this indicates a warranted investment of more than $27 million, or $415 per square foot.  This is the most proven and mature business model of the sports/food & beverage models.

Other models include:

1. F1 Arcade is based on iconic Formula One racetracks and is offered in Boston, Washington DC, Las Vegas and London.  Featuring craft cocktails and seafood, Kobe beef, and bar fare with an upscale theme, the venue allows entrance to customers from 7 years of age and older.  The Boston unit is approximately 16,000 square feet.  Kindred Concepts, the parent company, recently raised $130 million in financing for expansion. 
2. Camp Pickle is scheduled to debut in Denver and Tulsa in 2025.  This new attraction will be like an old-time summer camp, the kind your grandparents attended.  Of course, Pickle Ball is the theme, and food beverage and other activities are offered. 
3. Spin is a concept created by Susan Sarandon in New York in 2009, themed on competitive ping pong.  With locations in New York, Boston, Chicago, San Francisco, Toronto, Philadelphia, Seattle and Washington DC, the menu provides farm to table, locally sourced food. Units range in size from 4,000-12,000 square feet, fitting nicely into a shopping center configuration.
4. Sixes Social Cricket offers competition in a sport that many Americans know nothing about… Cricket, with karaoke offered as backup!  The food is said to be excellent, featuring typical bar-fare.  Bookings include an adjoining table for food and beverage.  The first U.S. unit is in Dallas at the Colony.
5. Goodsurf is an 8,000 square foot sports restaurant based on surf simulator technology that allows waves to be created by machines, taking much less space than a typical wave pool.  Food offerings include burgers, fries, vegetarian options, and ice cream for the kids.  The first location is in Dallas.
6. Flight Club is a high-tech dart simulation game with seven units located in the United States in Las Vegas, Denver, Atlanta, New York, Los Angeles, Houston, Boston, and Chicago.  The food offerings are gourmet versions of flat breads, tacos, salads and fries.  The newest unit is in Denver at 10,000 square feet, close to Coors Field and the Ball Arena.  

Culture

My favorite in this category is Meow Wolf, which began in 2008 as a collective of anarchic artists in Santa Fe (NM).  It offers interactive installations, each with a different theme. The attraction offers six locations including Santa Fe, Las Vegas, Houston, Washington, and Denver.  Each location has a different immersive art theme with hundreds of storytellers from throughout the world and local artists’ features.

The newest and largest store is located in Denver and features more than 70 immersive attractions in 90,000 square feet.  (The Houston location is only 32,000 square feet.)  Convergence Station, as it is called, is a multiversal travel experience between four alien worlds, inspired by the location near two freeway overpasses. 

The newest store is scheduled to open in 2026 and is in final lease negotiations that will bring a Meow Wolf exhibition to West Los Angeles. The location is a vacant movie theater complex.  The theme will be cinema. Meow Wolf’s move into its largest market yet is intended as a statement piece, a declaration that weirdness and art-focused ventures still have a place in an immersive economy that’s been racked by closures and layoffs, Meow Wolf included.

In April, Meow Wolf announced it would cut 165 employees. Exhibitions in Denver and Las Vegas were heavily affected.

General admission is $40 for adults and $35 for children and passes are available.  The business model is based on buying/leasing low value properties in subsidy rich locales.

Destruction LBE’s

Can we talk about Las Vegas, the lab for all new location-based entertainment?  How about Dig This, with an admission price of almost $205?  This is a wrecking lot with real earth-moving machines, caterpillar D5Ks, bulldozers, and mini excavators.  With instructions being the first step, a neon yellow vest and a hard hat are provided with in-cab training. Then, you get turned loose to wreck real things like a car!  This is about the most male-oriented attraction of those researched!

Adventure and Technology Driven Formats

Location based virtual reality is a whole world unto itself with a following that includes mostly young boys and men.  But the industry is making a Location Based-Social interaction with games to engage the consumer in a community experience.  Some of the themes include war, exploration, and adventure.  Research shows that female consumers are loving some of these group games, those that don’t require you to keep a body count!

(Now maybe I’m old-fashioned, but explain this to me.  A whole bunch of your friends put things over their eyes where they can’t see each other nor speak to each other, nor touch each other. These are group games that seem to me to be a totally weird way to connect.  Just this consultant’s opinion, but I think we have lost our way in terms of entertainment value and the sense of connection that is required to be human!)

Still, one concept is killing it! 

Sandbox VR is a location-based concept out of the UK and Ireland, with two locations in the UK (one in London, one in Birmingham), and 31in the United States.  Of these, seven are in California, one in Chandler (AZ) and another in Mall of America (MN).  The average spend is £37 in the UK and $55 in the United States. The UK locations earn between $1.9-$2.6 million, with an EBITDA of 35%.  Capital expenditure on the equipment ranges from $500,000-$750,000.  Buildout of the average 5,000-6,000 sqft location ranges from $1.5-$3.0 million, cost of which is borne by the lease and/or can be negotiated with the landlord.  The games are story driven and can change constantly.  Collaborations with Netflix and Paramount are planned to provide content. 

At the writing of this blog, Sandbox VR launched a game based on Netflix’s Zack Snyder’s “Rebel Moon.” This experience has players “gear up with their fellow rebels for battle against the ruthless forces of the Motherworld’s military,” per the game’s description. “Inspired by the vision of legendary director Zack Snyder, players become members of the resistance and are transported to the planet of Daggus, descending through skyscrapers, streets, and a subterranean mine while they defeat enemy soldiers and spacecraft.”

With the development of operating economics reported, this is one of the first VR experiences to complete a “proof of concept” and earn economic industry-standard return. 

Intellectual Properties 

My favorite location-based entertainment center based on an IP is the Crayola Experience.  This format is based on (what else) the iconic Crayola Brand, with the flagship attraction in Easton (PA), where the factory and headquarters are located.  At 65,000 square feet, and with lots of colorful activities to do, the attraction boasts an adult/child entry fee of $26.99.  Other locations include Chandler (AZ), Bloomington (MN), Orlando (FL), and Plano (TX).  Activities offered are very creative such as the Activities Studio, The Cartoon Creator, and the Adventure Lab. 

In 2022, the brand began a licensing concept. The growth strategy presented in 2022 includes extending the location-based entertainment footprint domestically and internationally.  “We are now looking to develop licensing partnerships that bring new capital and expertise to accelerate our LBE expansion, particularly internationally where local market access and expertise are important,” said Victoria Lozano, Executive Vice President Digital Strategy, GM Attractions & Retail for Crayola.

The first Crayola Experience opened 25 years ago as The Crayola Factory in Easton (PA). Crayola saw an opportunity in LBE and in 2013 reimagined the downtown attraction as Crayola Experience. The company also owns and operates Crayola Experiences in Orlando (FL), at the Mall of America in Bloomington (MN), in Plano (TX), and in Chandler (AZ).  With venues ranging from 20,000-60,000 square feet, Crayola Experience engages more than 1.5 million kids and adults annually in activities inspired by/and incorporating proprietary Crayola products and technologies.

Crayola is continuing to develop creative concepts that will help scale its events and exhibitions LBE business.  Early this year, Crayola debuted IdeaWorks at Philadelphia’s Franklin Institute, a traveling exhibition encouraging families to explore innovation, invention and design thinking.  The company also collaborated with OceanX, a global ocean exploration nonprofit, on a national takeover tour of the Crayola Experience venues that began this summer and runs through summer 2022.

Other notable concepts of IP-based LBE’s include the LEGO Discovery Centers, branded popup retail locations with characters such as Barbie and Peppa Pig.  Today, studios and other IP owners are monetizing their brands by creating places where their properties can be owned or licensed out to the LBE owner.  One great example is MONOPOLY LIFESIZED, created by Habro (self-explanatory), and Sony has opened a division to license its intellectual properties for developers.

Other retail pop-ups with a brand LBE include Hello Kitty pop-up cafes, the Rolling Stones pop-ups, and the Barbie branded sales areas at Selfridges in London.  

Conclusion

Most of the examples presented must continue proof of concept and financial goals.  We hope many will stand the test of time and blossom to enrich our industry!

What are your favorites?  Let us know, we always love your input and experiences!