Homebuilders Building the Game

The Quick Points

📺 MLP draft day tomorrow! MLP is hosting its draft for the Premier and Challenger level teams in Central Park at CityPickle. The Premier Level (top 12 teams) will pick first, from 9am - 11am ET, with The Dink providing live commentary & analysis on the PicklePod podcast. MLP plans to live tweet player picks in real-time and provide highlight reels on Instagram. After, they’ll move on to the remaining 12 Challenger teams, who will draft from 12:30pm - 2:30pm ET. We’re hoping that the next draft can bring some of the same energy and production value as other sports leagues, where pickleball fans can watch the picks in real-time from each team.

Shoutout to Ryan who recently stepped in as the GM of the Columbus Pickleball Club! Braxton’s addiction to fantasy football has had him pestering Ryan about useless snake draft strategies all week, while he actually prepares to build out a team, starting with the #6 draft pick.

📈 Speaking of MLP…big time valuations. This Front Office Sports piece on MLP team valuations continues to demonstrate the explosiveness of pickleball at every level, from amateur play to pro. In a recent CNBC interview, MLP’s new CEO, Julio DePietro, noted that some team valuations had seen an eye-watering 100x growth, soaring from their initial acquisition price of $100k in 2021, to $10M this year. Big-time paper gains for a slew of investors who have been piling into the sport. We continue to think through how those investors coming in at the latest rounds will see returns, as it’s unlikely that the professional league itself has grown to support those valuations (viewers, broadcast revenue, attendance, etc.). However, it’s still early days for teams to get creative with fan activations and new ways to build loyalty to specific players they draft in their local markets. Some of these opportunities should start to present themselves after this season, when the ‘finalized’ standings of Premier and Challenger teams are decided based on the cumulative results of the past two seasons - at which point, teams can focus on longer-term, multi-season strategies. This article helps to explain the league format this year for those not as familiar.

👟 Another day, another brand (x2). (#1) Skechers announced their partnership as the official footwear of the 2023 English Open and English Nationals’ pickleball tournaments. Like others in the space, they launched a pickleball-specific court shoe, the Skechers Viper Court, in a move to capture the increasing demand for anything touching the sport. Skechers has become increasingly invested, as they’re a sponsor of every professional league in the U.S. (MLP, USA Pickleball, APP, PPA, etc.), and signed their two first pros Tyson McGuffin and Catherine Parenteau in 2022. This is also a positive story for the continued presence of pickleball internationally, as the well-known shoe brand presumably sees continued adoption and retention among players across England justifying their investment.

(#2) A quick mention for the women’s activewear brand, Bandier, for partnering with the sporting goods maker, Head, to add men's & women’s pickleball apparel for their summer collections. The collections will launch at the Bandier stores on Melrose (in LA) and the Flatiron District (in NYC) on 7/13 and 8/25, respectively. The launch events will be held in tandem with pickleball activation events in LA and during the U.S. Open in NYC with Head athletes. Add ‘em to the growing list of designers taking a stab at pickleball-centric clothing (e.g. Alice+Olivia, Staud, Varley, Norma Kamali, Moda Operandi, etc.).

What’s on our mind

🚧 Homebuilders building the game. As we’ve speculated in past issues, a greater number of homebuilders are considering pickleball as a valuable amenity to attract new homeowners. Jacksonville, FL-based Dream Finders Homes is the latest developer to include pickleball courts as part of their upcoming 57-lot subdivision in Windermere in 2026. These companies are in unique positions to find plots of land within their broader communities that are well situated to build courts from a quality of play and noise pollution standpoint. They’re inherently building everything from the ground up, so proper spacing considerations can be made compared to public parks with adjacent communities. We’re interested to see how many of the homebuilders specifically acknowledge pickleball construction in upcoming earnings calls, and we’d like to better understand how these homebuilders make the final decision on what types of amenities to provide to their communities, particularly given the footprint pickleball requires (Dream Finders Homes is using 300 acres for their courts in the Windermere development). Our natural assumption is that the benefits accrue through some combination of higher HOAs and higher ASPs per home, but unsure how to quantify that or how it compares to other amenities (pools, parks, gyms, etc.). Dream Finders Homes is now on the list of other big name developers including pickleball as an amenity, including, D.R. Horton’s development in Serenoa, Lennar in Wellness Ridge and Pine Glen, Pulte in Del Webb. If anyone is connected to people in the real estate community development space, we’d love to run some questions by them and would really appreciate an intro.

🧃 It’s so bad, it’s…still bad. For a company that used to have some of the most electric athletic commercials that we can remember growing up (sweating out your favorite Gatorade color anyone??), Gatorade may have put out one of the most painful to watch pickleball-centric advertisements. Somehow, a fast food footlong sandwich shop’s pretty bland commercial decimated the marketing department of one of the most prolific sports beverages…we’re hoping they were taking the strategy of “make something so painful to watch that everyone says Gatorade 1M times in the next 24 hrs”. No disrespect if you work at Gatorade and read The Reset (we luv u), it’s admirable the advertisement is for some charitable cause and we will still be drinking Gatorade in this afternoon’s 100-degree heat…but wow. How we feel rn…

Breaking Ground

The Reset is beginning to track publicly available court construction data to keep track of locations, costs, and development projects across the nation. Our tracker can be found here.

Featured Developments:

Boston is one of the latest cities to see an eatertainment complex go up, with Harpoon Brewery’s Pickleball Social Club launching in partnership with HUB Sports Boston. The facility is meant to entertain up to 400 people, with bars, lounge areas, shuffleboard courts, cornhole boards, and four lighted pickleball courts. They’re leaning into some pickleball programming too, with two leagues - Rec. for more casual play and “Juicer” for more competitive play. The Brewery believes that the pickleball amenities will help drive additional reservations for corporate events, team-building outings, charity events, and community days - which, as we’ve discussed in the past, typically all bring in much higher price tags and higher margins for these facilities. Individual rates aren’t cheap either, with dynamic pricing based on time of day and day of the week, with the most in-demand times going for $100 per hour.

Pickleball America is opening its first location in Stamford, CT at the Town Center. The facility is filling the 42k sq.ft. vacant space left by Saks Off 5th with 13 pickleball courts. They plan to open another 14 courts by September 14th upstairs from the existing courts, bringing the total facility to a whopping 27 courts. The facility is definitely more pickleball-centric, though they also offer a small lounge area for food & beverage. They offer annual memberships starting at $199/yr, and then add-on court rentals starting at $67.50/hr. This is one of the more expensive per-hour rates we’ve seen at clubs that also have memberships fees, albeit the amortized annual cost of a membership is ~$17 per month. The hourly rates feel fairly price prohibitive for the avid player trying to get out there multiple days a week. Even split 4 ways, an individual who is trying to play four days a week for two hours a day is spending almost $550 per month.

Best of the Rest:

• Erie County, PA is getting a small indoor pickleball-centric facility, Around The Post, with four courts. The project is expected to cost $55k - we’re guessing this is just for the cost of the new courts, and not any costs associated with changes to the existing real estate.

• The City of Southbury, CT cut the ribbon on its four new public pickleball courts at Ballantine Park. The project cost ~$158k, and one of their city officials noted support for the project was driven by their strategy to “increase recreational opportunities for people in Southbury”, at every age and every skill level.

• Plain Township in Ohio is converting two run-down tennis courts to four pickleball courts. The courts should be open by September and will cost ~$89k. The project was first proposed in 2021, and was quoted at ~$49k, by 2022 the project estimate rose to $55k-60k, with the final estimate coming in this April’23 at $89k. We’d blame inflation (+81% from first estimate)…but seems to suggest there’s some price pressure here from demand for courts.

• On our radar for the future…Camp Pickle, a large eatertainment complex in Denver is being built but not expected to be completed until the summer of 2024. The city has been facing noise ordinance issues at multiple public courts and the weather dynamics of Colorado make it a much-needed indoor facility.