As youth sports become big business, major real estate projects follow – Boston.com

Shortly after settling on Cape Cod in 2014, Mike Sherman, the former Green Bay Packers head coach and general manager, captured national headlines for accepting the head coaching gig at Nauset Regional High School for the 2015 season.

Now Sherman is taking his experience in a more entrepreneurial direction: He’s going to build a nine-acre complex for youth and teen sports in partnership with Warren Nighan, a Cape Cod businessman who previously worked in the medical device industry.

Sherman said Cape Cod is well-suited for this kind of project. In some sports, young athletes from the Cape must travel over the bridge and along the South Shore to build their skills, he said.

“We’ve been here two winters now,” he said. “There wasn’t a whole lot to do on Cape Cod. … A lot of stuff is going on in the summer months, but once they leave, it starts shutting down a lot. What’s there for kids to do to keep kids moving—keep them out of the potholes that are presented to them—during the low-energy months?”

Additionally, he said, demand for elite summer camps, along with regional or even national tournaments for travel teams, represents an opportunity for a Cape Cod youth sports facility, because it allows parents to tie a vacation into the journey.

The $12 million Total Athletics Cape Cod facility in Hyannis will include an ice arena, an outdoor field that can be used for multiple sports, an indoor fieldhouse, a rock-climbing wall, a pro shop, workout facilities, a cafeteria-style food court, and more. A supportive philanthropy group gave Sherman and Nighan an affordable lease to build on its land, which is located on industrial-zoned land near Route 6.

Depending on how things go, the facility could expand to as many as 30 acres. Even then, it would be relatively small compared with other projects that have popped up across the region and country.

In the Northeast, the highest-profile example is Spooky Nook in Manheim, Pa., where the 50-acre complex features a 700,000-square-foot indoor sports facility, outdoor fields, a hotel, food court, smoothie bar, and restaurant. Among the events on its calendar this summer are a showcase for high school basketball players from across the mid-Atlantic looking to attract college recruiters at a cost of $125 per player, and invitational youth baseball tournaments charging nearly $600 per team.

That’s not unlike the goal in Massachusetts, where three separate projects—including Sherman’s in Hyannis, a $50 million facility that recently broke ground in Attleboro, and a $110 million-plus behemoth on life support in Sandwich—hope to capitalize on the real estate trend and the industrialization of youth sports. Though varied in size and scope, the projects have a couple of things in common: They’re bolstered by an influx of money pouring into the youth sports industry, a sector now estimated to generate $7 billion per year, and their costs would be controlled by favorable real estate deals.

“There’s a number of factors that play into this whole commercialization point of youth sports,” said Lisa Delpy Neirotti, a professor of sports management at George Washington University. “Organizers found a business opportunity: They started rec leagues, but people wanted it to become more competitive. So they formed the travel leagues. … And when you’re playing sports year-round, the teams become better, and they want to go out of their community to find a challenge.”

In Attleboro, it’s not lost on Joe Fitzpatrick that youth sports have become big enough business to drive the biggest real estate project in town. But Fitzpatrick, a seasoned investor and one of the partners behind the project, doesn’t think the growing size of the youth sports market is the only factor driving the real estate ventures. There’s also a need for new facilities in the region, he said.

“The majority of youth sports facilities are antiquated,” he said. “They’re falling apart due to deferred maintenance.”

The $50 million, 105-acre New England Sports Village broke ground earlier this year after acquiring property under-market that the city had long unsuccessfully tried to turn into an industrial park. The project will feature an ice arena, a swimming pool, indoor and outdoor fields, a pro shop, and dining options. It will also include a 150-room hotel with tournaments in mind. The project’s backers have already signed up a long list of planned local tenants, ranging from elite travel teams to local high schools.

And it could get bigger: Fitzpatrick and his partners have the option to expand the complex to as large as 140 acres.

Fitzpatrick thinks the sports-centric campus could drive other types of higher-value commercial development on the added land, specifically citing healthcare offices as one possibility.

The future is less clear for an even more ambitious proposal in Sandwich that has struggled to get moving. The project, with cost estimates ranging between $113 million and $200 million, was announced in 2014 to significant hype, but it may have been too big for its britches. In addition to sports facilities and a hotel, it would have also included a convention center and a retail component.

But its prospects appear cloudy at best. The project had major names attached to it, including Dan Duquette, the former Red Sox general manager who runs youth baseball programs in Western Massachusetts, and John Hynes, the CEO of Boston Global Investments, which has been a big player in developing Boston’s Seaport District.

The Sandwich developers also struck a deal for cheap on undesired town land, which has not closed, and won’t if the project doesn’t advance. The costs to fix wastewater issues at the site have proven far greater than expected, and questions about how to address them have played a big role in the project’s delay.

Hynes did not respond to calls seeking comment. In an interview last winter, he said the project is “on life support” after an effort to determine its financial feasibility. His level of involvement is unclear at this point.

George Dunham, the Sandwich town manager, said that he sensed the partnership between the developers had fallen through.

Robert Clark, one of the principles behind the development, still thinks the complex has a chance, but it’s running up against a town-imposed June deadline to secure needed permits. He’s asking to extend the deadline as he seeks grants to address the wastewater problems. The project has faced some organized local opposition who argued the land could be better utilized.

The onset of the Hyannis project represents new competition down the road, compounding the challenge the Attleboro project less than an hour away. Both of those projects hope to open late next year, while Sandwich seems like a far-off—if not remote—possibility.

Jason Clement, chief operating officer of industry consultancy Sports Facilities Advisory, said affordable real estate are often a key to building a recreational sports complex.

With a good land deal, the big complexes can prove financially successful, said Clement, whose company has been involved with all three projects. But even then, they’re unlikely to be cash cows, and the entrepreneurs behind them usually see the projects at least in part as an opportunity to give back.

“People don’t get into this business to make money,” he said. “They can generate a higher return elsewhere. But it takes some sort of blend of having a reasonable outlook in combination with some kind of qualitative influence.”

That’s the case with Sherman. Having lost a godson to opiate addiction, he believes increased access to athletics is one way to fight an epidemic that’s killing youth on the Cape and across New England.

“With these types of businesses, you don’t make a lot of money,” Sherman said. Still, it’s not a philanthropy: “It’s a business relationship. It has to make some money to survive,” he said.