Is The Apartment Gym Useless In Resident Retention?

If you build it, they will come, right?  But the question should be:  If you build it, will they stay?  Are your amenities designed only for the initial lease, or are they designed to give value on an ongoing basis to your residents year after year?  With this in mind, I think we need to reevaluate our amenities with resident retention in mind, and see what is really making an impact on the renewal decision.

Today, I'd like to take a look at the common apartment gym in our apartment communities.  Although some gyms at higher end communities are truly state of the art (and don't apply to this blog), here are some traits of the vast majority of gyms relative to stand-alone fitness facilities:

• Small and cramped
• Limited number of machines
• Incomplete free weight sets due to theft
• Older and malfunctioning equipment
• Often only open during office hours

The problem is that owning and maintaining a gym is not the core business of an apartment community, but rather an offshoot feature usually only designed for the initial sale.  Whereas actual gyms phase out old equipment and replace lost weights/etc, apartment communities often view the gym as a one-time expenditure, with less emphasis on upkeep.  Apartment community gyms are often relatively small rooms with few machines to begin with, and really only appeal to occasional users of the facility. 

Let's take a look at the residents themselves and how they view gym membership/visits.  I had the pleasure of talking to Tom Kennison, owner of several gyms in the north Houston area, and he helped identify people's opinions relative to going to a gym.   Here are the four basic types of people:

1. Don't ever go to a gym and are not interested
2. Would like to go to a gym, but still don't take the initiative
3. Only go occasionally
4. Regular visitors to the gym (3 days or more a week)

Perspective From a New Lease:  When it comes to interest in the gym, the initial lease of an apartment is going to be much different than the renewal.  In the original lease, the second and third types of people might be swayed by a gym in an apartment community.  The second type likes the idea of going to the gym, and even though they won't ever step in your gym, it will still impact the sale.  The third type will occasionally use your gym, which helps with the initial sale.  The regular gym-goers, however, are active enough that the average apartment community gym will not impress them, so it will not impact their buying decision.

Tom also said that 70% of gym members are passive, which are really the "target audience" for your apartment gym.  This is really quite amazing, that 70% of gym members pay month after month without even using the service.  This fact makes a strong case for inclusion of a gym in your operations.

Perspective From a Lease Renewal:  Moving to a new apartment often comes with new resolutions about how to live, including the desire to get off the couch and get in shape.  But once a resident has lived in a community for a while, that resolution becomes a thing of the past, and the routine of daily life becomes the prime driver in their life.  This means that the second category of people, those that initially liked the idea of a gym but will never go, now see little or no value in your gym.  And for those that only use it occasionally, it is unlikely that their occasional use of the gym will actually impact their decision to renew in any meaningful way.  So for your "target audience," your gym has now switched from being a driver in the decision making process to a dud in the renewal process.

Apartment Gyms = Good sales tools but lousy renewal tools.  So why have a gym at an apartment community where the vast number of people who get "value" out of it don't even live in the community yet?  Tom shared his relationship with apartment communities, where he gives a free gym membership to the entire community in exchange for one apartment (he mentioned a 100 unit property, so the "cost" might be more for a larger community).  This way, the apartment community continues to get the marketing benefit of the free gym (and a better one at that), but does not have to use valuable real estate on a subpar version on their property.  This is only one solution, but it makes sense to create strategic relationships with those who can offer this service better than an apartment community can!

Of course, if it is an existing community and you already have a gym, what to do?  You have several options at this point:  First, consider the benefit of repurposing the gym for a different use.  Whereas the room might be small for a gym, it might be perfect for a different use!  Second, if the numbers just don't add up to abandon the gym, then consider how you can get more value out of it in a resident retention sense.  Keep this in mind:  If your residents are not using it, it has no value to them.  So be creative in developing programs to actually get the gym hopping!  And make sure that it is available when your residents want it.  If your gym is only available when your residents are at work, how much value is it really?

In the end, don't just have a gym because you think that's what apartment communities do.  Understand why it is there, if it should be there at all, and if it is really doing its job!