Apr 20

Retail Real Estate Insights. For Retailers. By Retailers. Chain Store Age

It is appropriate that Salt Lake City, Utah — a place that has been called “America’s Climbing City” — is home to an experiential retail concept that aims to be nothing less than America’s climbing gym: Momentum Indoor Climbing.

Momentum, which owns and operates next generation climbing gyms across the Salt Lake area, is in the process of launching a significant nationwide expansion. Momentum prides itself on its inspired wall designs, revolutionary climbing environments and climber training innovations. But perhaps the brand’s most valuable asset is its authenticity. CEO Jeff Pedersen taught himself to climb in Provo, Utah’s Rock Canyon, while in college, and has been intimately involved in the world of climbing ever since.

As early as the 1990s, Pedersen began thinking about ways to make a career out his passion, and–together with current Momentum CFO Nathan Maughan–started a small climbing gym. While that venture gave them some valuable experience and demonstrated that the general concept was sound, it also prompted a question: “Why,” Pedersen and Momentum co-founder Kevin Bradburn asked themselves, “does America’s Climbing City not have a full-size modern climbing gym?”

That conversation took place in 2004, Bradburn and Pedersen started looking for a suitable space to fulfill their vision shortly thereafter. What they found was a site in the South Towne Mall in Sandy, Utah. The former home of a Cineplex Odeon Theater, the sizable rectangular space was partly occupied by REI. Aided at least in part by the landlord’s realization that this was an opportunity to leverage some positive co-tenancy synergy, the deal was struck and Momentum Indoor Climbing opened its first location in late 2006. While the recession made for some early challenges, it also helped Momentum learn to operate in a lean and efficient manner. By late 2009 the company was seeing double-digit growth–a trend that has continued every year since. In 2014, Momentum opened two new gyms in the area, one full-sized climbing gym in Millcreek and a smaller purpose-built bouldering-only facility in Lehi.

Today, Momentum is one of a handful of large operators working to bring the sport of rock climbing to new communities and introduce it to new devotees and generations. As a climbing brand within a climbing industry, Momentum feels like it has a literal and figurative leg up on the competition. Pedersen explains it this way: “Our direct connection to America’s sport climbing roots allows us to communicate climbing to new generations in an authentic way that others can’t.”

That direct climbing connection is more than just an empty philosophy: Momentum continues to bring passionate and experienced climbing professionals into the company fold. Noah Bigwood, Momentum’s VP of Development and Construction, is emblematic of the kind of passionate and experienced climber that populates Momentum’s professional ranks. A lifelong member of the climbing community, Bigwood has been climbing for more than four decades, founding a successful climbing guide service in Moab, UT in 2001.

Understanding where Momentum has come from and where it hopes to go requires a snapshot of the climbing industry–a picture that looks very different than it did 5-10 years ago. The sport is blossoming. Climbing has gone from the fringe to the mainstream in a remarkably short amount of time. And while Momentum has contributed to that growth and evolution, the climbing retailer also hopes to benefit from it, as well.

Today’s Momentum customers are not just climbers, they are people who want to do something new, fun and engaging. “We have new people coming into our gyms all the time who don’t really know what to expect, but they are looking for something exciting,” says Bigwood. “We want to amaze and inspire them.”

That positive first impression comes at least in part from the facilities themselves. While Momentum facilities are designed to satisfy the highest professional standards of experienced climbers, all gyms offer programs, training tools and terrain to meet the needs of every climber, from first-time-walk-ins to elite climber athletes. Momentum’s modern climbing gym designs are innovative departures from the cramped, dark, aging warehouse spaces that played host to early climbing gyms. Momentum’s facilities are more like fitness clubs, with colorful walls and a bright, welcoming atmosphere.

An investment partnership with a Bulgarian company called Walltopia–a world leader in climbing wall design and manufacturing–not only ensures that Momentum climbing walls are the best in the industry, but also makes it possible for Momentum to be further capitalized.

Momentum provides two very different and distinctive types of facilities: large full-service climbing gyms and more modest sized bouldering gyms. The full-service gyms range in size from 16,000 square feet to 35,000 square feet, with new build-to-suit ground-up facilities trending toward the higher end of that scale. The size of the bouldering gyms, on the other hand, depends heavily on building availability and site specifics. Because they are adapted to fit the available space, they range in size from 12,000 square feet to 40,000 square feet.

The full-service climbing gym concept is a primarily suburban phenomenon, with extensive youth programming and a full suite of programs and services. The bouldering gyms are better suited for more urban locations, where urban young professionals and Millennials are more likely to take advantage.

“Because both concepts are extremely site- and context-dependent,” says Ben Brown, a broker with Houston-based commercial real estate firm Baker Katz and an X Team International partner, who is supporting the brand’s expansion efforts in Texas. “Momentum’s expansion plans will be somewhat dictated by the nature of the available real estate opportunities.”

Momentum evaluates expansion opportunities in a manner that might seem backward compared to other retailers in their category: they look at the overall real estate picture first, including demographics, access, consumer types and school quality. Only once those criteria have been met does the company begin to identify and evaluate specific sites. Today, Momentum is actively and aggressively looking for new markets and new opportunities within those markets–focusing primarily on major metropolitan areas across the country. Market and site selection considerations are complicated and variable-packed, but are largely dictated by the competitive landscape in the market.

“Momentum’s upcoming expansion in Katy, Texas on the west side of Houston was an easy call since the Houston area is largely underserved,” said Brown.

Going forward, Texas remains an area of special interest for future expansion. On a national level, the goal is to complete three to four projects in the next year, an additional three to four in year two, and at least five new locations in year three. Those ambitious goals are well suited for a brand that has successfully helped translate rock climbing’s status as sport, art and lifestyle into the retail marketplace.