Bayside, Queens: Working Out How To Make Money with a Gym

The boards of the two co-ops — which use the same property management firm, Mark Greenberg Real Estate — cooperated for a solution that would not only appease all parties, but also generate revenue: a membership-only gym. 

Scott Soifer, the property manager, had heard of similar projects that proved the viability of a dues-financed athletic club. "One of our superintendents told me about other buildings with gyms and how successful they were," he says. "We looked into the pricing of getting this done and decided to go ahead."

Start-up Costs

The renovations and new equipment carried a budget of $70,000, paid out from the co-ops' reserve funds. Shareholders pay $15 per month, per person, for a gym membership, and that revenue is split evenly between the two properties.

"Scott spearheaded the project, and he looked around to find the right place for the gym," Warshaw says. "Eventually, he settled on an empty room in 23-25 Bell It took more than just bringing in the right equipment. The room needed a lot of work done, and we had to analyze the cost to make sure it made sense."

The proposed gym area — an empty room in 23-25 Bell — was located below several apartments, which necessitated extensive soundproofing. Then a new, commercial-caliber gym floor had to be installed, along with mirror walls, a new bathroom, additional circuits, wiring, air conditioning and new lighting. It took a bevy of contractors to get the room ready for the new gym equipment, which was purchased from Gym Source. 

Financial Pay-off

Warshaw says the addition of the gym was a sound financial decision in several ways. "The costs after construction are pretty minimal," he says. "The equipment doesn't last forever, but we're prepared for that. The only miscellaneous cost is the electricity for the equipment and air conditioning during the summer."

A month and a half after the gym opened, 79 people have joined. A series of instructional open houses for enrolled members confirmed that the project would pay off. Says Soifer: "All the comments I heard from the residents about how happy they are about this new amenity speak for themselves. The gym was very well received." 

Project started: November 2013
Project ended: February 2014

PROJECT 

● Refurbishing an existing empty room for use as a gym

● Replacing the floor

● Soundproofing the ceiling

● Improving the electrical infrastructure

● Adding key fob system and three security cameras

INVESTMENT

$70,000 

PARTICIPANTS

Scott Soifer, property manager, Mark Greenberg Real Estate

Fred Warshaw, board treasurer 

RECENT SALES

01/27/2014: $198,000
01/16/2014: $185,000

FINANCIALS

Estimated market value: $34,047,000

Assessed value: $14,403,230

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