A 13-year veteran of health club and fitness facility design, Rudy Fabiano, AIA, president of Fabiano Designs, brings what he calls a sense of spirituality to the industry, Taking cues from restaurants, hotels and even churches, Fabiano believes that by mixing effective programming, advertising and design, the industry can increase its retention rate and its standing with the financial community.
Ci: Architecture and design has never been top-of-mind for the fitness industry, how did you come to specialize in it?
We've been in business about 13 years. The first club I did was a Gold's Gym in Princeton, NJ. At the time, I was a young architect working for a developer and I wasn't allowed to play a lot working for them. The whole idea of developing this health club where the goal was to try to entice people to come in and to stay, was interesting. I didn't know anything about the industry, didn't know you were supposed to put a heartbeat stripe on the wall. I designed this funky gym and didn't think much of it. It was successful at the time.
A couple years later, someone in my hometown, in Belleville, NJ was building a health club and they approached me. I decided that I was going to start my own gig and I didn't know what that gig was going to be. I worked at home at the time and I spent about three weeks designing the club. When I came back it was nothing at all what they expected. We did crazy stuff like pouring the juice bar out of concrete, and it had an art deco Roman theme. It really was interesting because the design was coming from a person that hardly ever worked out.
Ci: So the designs were pretty radical?
I came in from the perspective of a chubby guy and I accidentally hit on something because I was designing what would make me happy in the space. I was going against the grain at the time where everyone wanted to line up the rows of equipment and everyone wanted cardio up front. I stumbled onto how to design for the common person because here I was, sort of a common person. I was an architect who was interested in designing spiritual places — churches, even bars to a certain extent have a rhythm and spirit that is fun and exciting. I tapped into those desires when I started designing and it was something new at the time. Everyone else was designing from a sports theme. I came from an entertainment, spiritual and fun attitude. I had designed a couple and my wife said, “you know you should try to get a real job. How many of these health clubs could you possibly do?” It's funny because by now we've probably worked on more than 200 clubs in some capacity. She doesn't ask that question anymore.
Ci: Was it tough to convince club owners to get away from the typical look and feel? Is that still a challenge?
Yes, this industry has been a challenge from the beginning and it still continues to be, although the challenge has shifted. In the early days the industry was so new, and the people that came to me thought that there was value in creating a different type of space. I think as soon as people started seeing what I was doing they were enthralled. But the challenge was they would say, “hey look Rudy, we have no money. But on the other hand you can design what you want because we don't know any better.” My average client was usually a 30-something, blue-collar guy who put up his house to build the club. They had no money, but I could do whatever, I could create with no money. As an architect, creative freedom is one of the toughest things to find. To convince people to go out there a little bit in design was difficult because they weren't used to it. We were still getting in members who had a propensity to workout so we were just trying to differentiate ourselves from the competition. The challenge now is that, as an industry, we're still severely underfunded. I think one of the stories that hasn't been talked about is the rating that banks have given health clubs. Before, when I designed a club and would meet with a bank, they would say, “well Rudy, what is this thing going to be once this health club goes under?” Not if it goes under, when it goes under. So one of the challenges has sort of been overcome but we're still underfunded in general. So now I'm fighting success meaning that you might have somebody who owns five clubs and are successful doing what they're doing, why go to the next level? Why step it up a notch? Why spend a bit more money to do a better space? Will it make me money back? That is a hard bridge to cross for many people.
Ci: What is the answer to the question of making money back?
The answer is yes. Not only will it make money back but it will move the industry forward. The underlying challenge is not how to differentiate yourself from the competition. It is competing for a new market of people that wouldn't think of joining the club and now understand that to live longer and to stay healthy and happy you need some physical activity in your life. The other challenge from our perspective is how do we bring in people that would not normally join a club, how do we go after a whole new market? Convincing owners of that has proven to be a challenge. My first health club must have cost $125,000 to build, where now our average build out is over $1 million. That is substantial in 13 years. To convince owners that that is a worthy investment can be challenging.
Ci: Has some of that extra cost come from a shift in the size of clubs or what they are putting in there, or what they need to do?
I think it has come from a few different sectors. One is that except for health club memberships, no price stays the same for 10 years. That's one of the reasons why we're still having difficulty funding projects and funding growth. Putting up a wall 10 years ago was five times cheaper than putting up a wall today. Second, we've gotten more sophisticated with our programming, where 13 years ago we needed a small aerobics room and pretty much an open big box filled with equipment and just some paint. That really doesn't fly anymore. We're getting complex programming, we're getting three or four group fitness rooms, we're getting a soft workout area, a hard workout area, multiple cardio areas. The average gym right now might have 75 to 80 pieces of cardio, where back then 20 was a lot. There was no abs or stretching area, juice bars were rare, and locker rooms were down and dirty when I first started. The last factor is that as this industry moves forward, as it becomes more sophisticated, we're not competing now just against other gyms, we're competing against restaurants, we're competing against hotels, we're competing to be the third place in people's lives. Aside from home and work, we want our facilities to be a natural place that they go to, that they feel comfortable at, that they integrate into their lifestyles.
Ci: Are you seeing owners putting in lounge areas and other community-type rooms?
We see owners that have a little vision and understand the long-term nature of this business. We are only penetrating 12 percent of the marketplace. We understand that there is a huge potential from a business point of view and from a do-good point of view to bring the other 88 percent in. There is tremendous growth still to be seen in this industry. Whatever owners are making right now, if they can double their membership, the gains are huge — in revenues and the good that they do. So the owners that have that long-term vision love the idea of exploring, expanding the facility conceptually. One of the things we're doing is putting in community rooms because I believe that our health clubs should have a community component. We should anchor ourselves to the neighborhood, to the community.
Ci: I think part of the reason some club owners have a problem with it is that they don't see the gain from getting out there.
That is true. I think a couple of elements feed that. One is that we have achieved some minor success so why fix something they don't perceive as broken. And the other is the inability to think outside the box. A lot of people still believe in the system of selling memberships where you wait for them to come in and the whole art of it is in the sales. You're selling a relationship; you're trying to sell a lifestyle, to not only them, but also their kids and their family and their friends. Some people are just picking the fruit off the tree that they can see. Build your retention and charge what you're worth and you'll get rewards ongoing.
Ci: In looking at the facilities, what are you seeing now?
In the early days what we were trying to accomplish to give at least a decent workout, a decent way to walk around the club and some decent locker rooms. If it was good, it was good enough, and the same thing with childcare. Childcare was maybe a couple hundred square feet, but at least you had it, and it was good enough. That was phase one — let's be decent about what we're doing. Then phase two was talking about the experience. So everybody started to jump on board and I guess we had some leadership roles in designing the experience. When you go into a place part of the experience was having multiple memories from it. Not just a big box where you walk in and say okay there is one big image and that is the only experience you are going to get. We started saying there are multiple spaces that you can create with light, with color, and maybe the experience can be more complex and fulfilling. We started talking, not just about the physical experience, but the emotional and spiritual too. There is something wonderful that happens when somebody works out and they do their third set and they're breaking a sweat and they start feeling something powerful about themselves. From an architect's point of view, how do you tap into that? Just by exploring the triad of physical, spiritual and emotional.
Ci: How is that complete experience playing out today in fitness facilities?
Where we are going with this whole thing is how to have a complete experience. You can go to a restaurant, order the entrée, gobble it down and leave. You are short changing the complete experience of going out and having a great meal and chatting with friends and having a good glass of wine and the appetizer and a cappuccino at the end. There is something that humans remember and have a good feeling about and have emotional attachments to complete experiences. Going to the health club can be more than just gobbling down an entrée, meaning just jump on the equipment and leave — sometimes that's okay. But sometimes you need to have the warm up, the greeting, the good feeling about being there. You just get into the whole thing and have a great workout, have a steam, take a shower, get dressed, have a shake, feel good about it so when you leave you say, “man I love this place.” The larger clubs have always practiced that. They have a great lounge when you come in. They have diverse workout floors, great locker rooms, great cafés, great views. There have been many clubs that have been successful because of it. It hasn't been brought to the “gym” level, and that is what we are trying to bring to the gym level. We came up with five terms that we tell the owner that if you can have this you'll probably have a great facility. They are: awaken your members, inspire them, energize them, rejuvenate and relax them. If you can have those five elements within your facility, then you are creating a complete experience for them.
Ci: Is it important to look at the demographics of people in your gym or people who are not in your gym when it comes to designing or redesigning the club?
I think that is an interesting point. On one hand there is a technical way of doing this — run demographics. But on the other hand I'm always surprised at how across the board the most successful clubs' membership is. The successful clubs that I see aren't specific demographic responses. The most successful clubs we see have 70-year-old people as well as 20 year olds, so part of that is that diversity brings life to a club. But your comment on looking at who is not in your club is interesting because you've gotten to people you are going to get doing what you are doing. And who is not coming in, I think that is a great way to look at it. Then you can consider where your architectural, programming and advertising response should be to that. That's a great way to build diversity. If there is one thing I will push, it is let's go after those people that aren't in the club, like you are saying, because that's who is out there.
Ci: If you look at the number of people who are in clubs, there are a whole lot more of them walking around who aren't.
The majority of people in this country need physical activity. We are involved in a great American business but if there was ever a business invented on the American ideals, it is this one. We create no waste. The computer industry is a great industry, I'm not going to knock it, but do you know how many computers in my office I've thrown away? We create no waste. We build this thing, we usually build it once and then renovate it, but essentially we create no waste. We do good for people. We're going to make you healthier, make you live longer, be happy, have a better sex life, look good and feel good about yourself, and the potential for revenues is awesome. We've only scratched the surface. We do no evil, we do good for people and we can make a whole bunch of money. There is no other businesses that does it this cleanly and effectively and have this force behind us. We just haven't really woken up and said hey, we're the good guys in this and there are incredible opportunities for us, let's go get it.
Ci: I think it would help others to take this industry more seriously, such as banks and the financial community.
The bank ratings are much better based on the numbers. The reason is it is a lot easier to lower your memberships and get a lot more people in and sit back and say, I'm making money. And there are a lot of great models for it. But, two things. One is we make deals. Clients come in and say, how much is a membership really, and we start giving them 10 different ways that they can buy this thing. And two, is that we educate them that on the national average, all a membership is worth is between $35 and $45. That's what they think it's worth. As soon as people got educated that having a cell phone is worth between $50 and $100 a month, no one questions that. Everybody has cell phones. I think it is incumbent on us, as an industry, to start raising the bar, and base that on, and this is important, that our product is a good product. Let's have confidence in our product. From an economics point of view we're making terrible mistakes when it comes to pricing, because we're not basing it on what our value could be to people. We create great facilities, with great showers, a great workout area and a great lounge. Unlimited access in a month costs what, $1.50 a day? What is living longer worth? What is looking and feeling good and reducing your stress worth? Again, we aren't charging enough. It is hard to build great facilities for the kind of money that we're asked to do it for. In any other industry such as the retail industry, the restaurant industry, even the professional office industry, the price per square foot is greater than what we have to work with. I have built some of our health clubs for under $40 or $50 a square foot. Where the average restaurant is over $100 a square foot, interiors only. Look at what spas spend for a square foot, but look at what they charge. The greatest challenge I'm facing is the economic challenge. We get leeway in our designs, we get a lot of leeway when we say, look you should have a library or you should have a community room. Most of the owners are educated enough to see the wisdom in that. The great challenge is saying to somebody, yes I know it is a $500,000 addition, but in the long run that is only worth 50 new members and if you charge legitimately it is even less. And there is a great opportunity here and if we can just all raise the bar, we can lead this industry to greatness.