New Recreation Businesses Serve Up Change for Infill Industrial Sites

It seems like everyone and their dog is playing racquet sports these days.

Pickleball and padel, a racquet sport of Mexican origins, are experiencing exponential growth across North America. In fact, pickleball is the fastest-growing sport in Canada. In November 2024 the official organization Pickleball Canada reached 80,000 members, compared to nearly 37,000 two years prior. Padel is considered the world’s fastest growing sport with the number of padel courts increasing by 240% between 2021 and 2024.

CBRE’s Michael Bellissimo knows all about the rising popularity of these racquet sports, having recently attended Property+Padel, an industry conference for racquet sports and real estate leaders. He connected with top athletes, investors and professionals from North America, the UK and Europe.

“The demand for pickleball and padel facilities is growing globally at a rapid pace” he says. “Operators are running out of tennis courts and retail spaces to convert and this is translating into meaningful demand for commercial real estate.”

Bellissimo’s connection to the event was two-pronged. He is an established industrial broker based out of CBRE’s Toronto West office. He is also a co-owner of T.10 Padel, Canada’s first dedicated indoor padel club located in Vaughan, ON.

Over the last few years Bellissimo has helped clients pursue infill employment land opportunities for various uses, including the conversion of large scale industrial sites to locations for high rise housing. It’s only recently that he’s seen increased demand to convert these infill sites and manufacturing buildings to new and creative uses.

“We’re receiving several calls a week about uses that had never been considered before,” says Bellissimo. “Last-mile infill developments are perfect for recreational and other specialty uses because some of them, like padel, require specific ceiling heights and column spacing that few non-industrial buildings can provide.”

Smashing Success

Early success at T.10 Padel has allowed Bellissimo and his team to look at opening a second location.  

“Based on our data, Toronto can easily support seven to ten new padel clubs and still be underserviced,” he says. “Right now we’re considering options in Toronto proper and understand that several other groups are doing the same.”

CBRE’s Adam Occhipinti and Matthew Pieszchala are also in on the racquet sports action, helping Pickleplex, an indoor pickleball facility, find new locations across the GTA. CBRE also represented an industrial landlord in a recent transaction for a 60,000 sq. ft. padel and pickleball facility in Oakville.

In Montreal, CBRE’s Christopher Rundle leased part of an old movie theatre at 733 Cathcart St. to PadelSport. The space has become Montreal’s first indoor padel and pickleball court. Rundle leased the adjacent spaces to a gym and an arcade operator, turning the building into a recreation hub.

“These users are getting financing from banks and institutional groups, often pay top of market rates and invest substantial capital into building out their own infrastructure,” says Bellissimo. “With revenues tracking growth, these aren’t scary uses anymore. The recent slowdown in industrial demand has also helped landlords diversify their tenant base outside of traditional warehouse and industrial uses in assets close to the city.”

Learning From the Pros

North America is learning quickly from Europe, which has a mature padel market. Spain leads with the world’s highest number of padel courts, 16,000, followed by Italy, with more than 9,000 courts.

For the past decade Spain has seen industrial spaces accommodate the padel expansion. “Repositioning industrial warehouses into padel courts is common,” says Luis Yanez, Business Development Director of CBRE Spain’s Sports and Leisure team, which specializes in recreational real estate uses. “Warehouses often have six to eight courts and reservations are made online, so the operational costs of running a facility are relatively low.”

A 2023 report by Deloitte and Playtomic, the leading sports booking app for racquet sports, says padel’s popularity surged post-pandemic as it provided a space for social interaction while catering to various ages and abilities. This interest is expected to grow, as 85,000 padel courts are anticipated to be available worldwide by 2026, compared to 40,000 in 2023.

Growing Demand

Immigration to Canada contributes to the rising demand for new sports and recreation facilities. For instance, the growth of Brampton, ON’s South Asian population has led to the proliferation of indoor cricket facilities in that city northwest of Toronto.

“As a business owner, I’ve had people from everywhere tell me they’re happy padel has finally arrived in Canada. And as a broker, I see tenants who are excited to have a new slate of potential sites to look at and landlords that are starting to seriously consider these types of uses after receiving multiple offers” says Bellissimo. “More sports uses are coming as new immigrants choose to make Canada their home and bring what they have readily available at home to the Canadian marketplace.”

He urges industrial landlords to embrace the opportunity to evolve some of their industrial sites. “We relied on manufacturing, processing and logistics as the market was growing, but a lot of this just isn’t happening in the city anymore,” Bellissimo says. “Assembly, warehousing and distribution for last-mile sites are no longer the only options.

“New uses are changing the face of employment lands and infill industrial sites globally.”