3 Ways to Invest in Esports Real Estate

By: , Editor

Published on: Feb 24, 2020

Learn how to capitalize on the growing trend of esports.

Egaming is the fastest-growing spectator sport, attracting thousands of fans around the world. Teams are as avidly followed as any of those in the traditional fan favorites like football and baseball. What's more, traditional sports owners from Michael Jordan to Mark Cuban have also invested in esports teams.

Where there are sports, there are real estate opportunities, and esports is no different. In esports, as with other professional sports, a lot of the real estate innovations revolve around arenas and hotels, but esports adds one more component. Because anyone can play esports, training and play facilities are popping up around the country. Even WeWork is allegedly looking into investing in egaming.

Esports and hotels

Recently, iconic video game brand Atari SA (OTCMKTS: PONGF) licensed its name to a series of hotels, starting with one in Phoenix, Arizona, being built by True North Studio and GSD Group. Other developers, including one in Japan, are planning esports-dedicated hotels. But egamers don't have to wait for these new hotels to be built. The Downtown Grand in Las Vegas is just one of the existing hotels that already caters to egamers who are looking to host their own tournaments, enjoy casual play, or stream on Amazon's (NASDAQ: AMZN) Twitch or other services.

As esports grow in popularity, look for more hotels to offer gaming PCs and esports facilities. Some hotels are also starting to capitalize on the growing business around esports tournaments. While so far esports hasn't become popular as an amenity in apartment complexes, as developers seek to attract younger tenants, this may become a potential feature in the future.

The stadium experience

Cities around the world are looking at esports as a way to fill stadium time not booked for concerts or other sports. In Philadelphia, Comcast (NASDAQ: CMCSA) and other partners are at work on a dedicated egaming stadium. The Esports Stadium Arlington, in Arlington, Texas, is the world's largest esports facility in the United States. It hosts tournaments as well as providing private rooms for bootcamps and training. The stadium is a former convention center that has been repurposed into a new facility, turning a former ballroom into a competition space.

The Luxor Hotel, owned by MGM Resorts (NYSE: MGM), has turned a former Vegas nightclub into the 30,000-square-foot HyperX Esports Arena. The arena hosts private events and also sells day passes for gaming.

To the mall and beyond

Perhaps the biggest opportunity in esports is happening at malls. In 2019, Simon Property Group (NYSE: SPG) announced it would become a shareholder in Allied Esports (NASDAQ: AESE). Its first dedicated esports venue will open at the Mall of Georgia. The 13,000-square-foot space will host tournaments and will include a broadcast studio. This is the first of what is expected to be a series of egaming facilities at Simon Property Group malls around the country.

Esports is also increasingly becoming a factor in how bars and restaurants attract patrons. Some esports bars host gaming events while others function more like traditional sports bars, giving fans a place to watch their favorite teams compete. Meltdown, an esports bar chain, now has 22 bars worldwide.

The Millionacres bottom line

As of 2018 investments in esports were up to $4.5 billion, and they are only expected to increase over the next several years. Real estate investors can take part in the esports boom in a variety of ways, large and small, from investing in companies that are building esports facilities to paying attention to where esports stadiums are being built and capitalizing on the resulting traffic. Some predict that within the next five years, nearly every major city will have an esports arena, making this a trend to keep an eye on.

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