Real estate catches up with popularity of e-sports

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For many sports fans, the history of professional sports teams is inextricably linked with legendary buildings such as the Montreal Forum, New York’s Yankee Stadium and Green Bay’s Lambeau Field where athletic stars display their abilities.

Now, investors behind e-sport-specific real estate in Canada are betting that those who love video games will want to congregate and cheer on their favourite e-sports teams, too – taking the leap to the virtual world back to the physical world.

The world of electronic sports has grown fast with postsecondary institutions offering scholarships to the best gamers who compete for teams on video battlefields in games such as League of Legends and Overwatch. What entrepreneurs are counting on, though, is that enthusiasts will want a place to socialize, to play games and also to watch the action on large-screen monitors.

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In Canada, where 23 million people identify as gamers, according to a 2018 report by the Entertainment Software Association of Canada, the opening of the country’s first commercial e-sports arena seems long overdue.

The Gaming Stadium plans to open its doors in Richmond, B.C., in June. The debut will be what Spiro Khouri, the vice-president of marketing for MyEsports Ventures Ltd., calls “a long soft opening.”

It will be rolled out in two phases. The initial “showcase arena” will be an 8,000-square-foot space in an existing building, a service bay of a former Acura car dealership, and will be a “scaled-down version” of the company’s ultimate vision – an 18,000-square-foot stadium that is to be built on the dealership’s parking lot over the next two years.

That staggered approach offers an advantage for the company that’s pinning its hopes on carving out a niche in uncharted waters. “What that allows us is 18 months to 24 months of operating, so it’s proof of concept,” Mr. Khouri says.

If the company’s dream comes to pass, fans who come through the doors of The Gaming Stadium’s multi-storey permanent arena will be presented with a multitude of retail options, selling merchandise and fast food.

The venue’s crown jewel, its vaulted gaming arena, will house a stage big enough to handle 12 gaming stations under a large cinema-style screen, with 240 seats for fans to observe the action with a licensed bar and VIP area on the second storey overlooking the entire space. The building will also house a couple other large gaming areas with up to 40 PCs.

Located across from a SkyTrain station and down the street from a local mall, the Aberdeen Centre, the stadium plans to serve the local community first and foremost. Professional gamers are not the target audience, although a team competing in the pro Overwatch League will play out of the facility, as well as the e-sports programs at neighbouring academic institutions such as Simon Fraser University and the University of British Columbia. The aim is for it to become the social hub of choice for non-professional gamers in the Greater Vancouver Area, both now and into the future.

“We’re catering to the 95 per cent who will never be pros,” says Dan Cybak, president and chief executive officer of MyEsports Ventures Ltd. "We want that 16-year-old, when he’s 36, 37, to still want to come to The Gaming Stadium with his buddies and still play 20 years from now.”

Mr. Cybak ultimately wants to build five facilities across the country within the next seven years. However, he realizes that the situation has to be right.

Part of the appeal of the Richmond facility is the area’s strong Asian population. As Mr. Cybak points out, based on The Statistics Portal, gaming is so popular in Asian countries that as of last year there were more than 1.23 billion gamers in Asia, more than six times the number in North America.

“The best part about the stadium and why we’re going to build a series of these is they’re adaptable to the community,” says Mr. Cybak of the project, which comes in at a total cost of more than $5-million for both phases, not including the land.

That pales in comparison with the recently announced US$50-million that is scheduled to be invested in a 3,500-seat e-sports stadium in downtown Philadelphia, but then e-sports infrastructure in Canada is still in its infancy.

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Part of the problem is that to be financially viable, the venues have to offer a multitude of programming and events to keep fans coming through their doors. Durham College, located in Oshawa, Ont., recently cut the ribbon on its 3,000-square-foot gaming facility, which will serve as the home arena for the school’s Durham Lords varsity e-sports team, but will be available to rent for corporate events, birthday parties and the like.

Shane Talbot, e-sports manager for Maple Leaf Sports and Entertainment Ltd., says the challenge of filling these facilities is no different than that faced by performing arts groups and theatres for decades.

“I think right now seeds are being planted, but there will be a future where you can fill these venues regularly in every major city, but I think that we’re still a ways from that at this point,” he says.

Mr. Talbot manages Raptors Uprising GC, MLSE’s professional team entry into the NBA 2K League, which plays its weekly matches in New York. He says that because of the custom staging that an e-sports event requires, using a venue such as 20,000-seat Scotiabank Arena in Toronto for e-sports events is problematic because of the time it takes to set up and the sheer number of other events being held at the venue.

While he adds that MLSE, whose real-world sports properties include hockey’s Toronto Maple Leafs and basketball’s Toronto Raptors, is more likely to use existing venues to host e-sports events, as opposed to building new venues, he says there’s an increasing appetite from fans to be in the building at these events, rather than simply streaming it or watching it online.

“The locality of gathering for live entertainment, just like you do for sports or concerts, rings true in e-sports,” he says.

To add to his point, Aquilini Group, which owns the NHL’s Vancouver Canucks as well as the Vancouver Titans of the Overwatch League, recently announced that as of 2020, the e-sports franchise would play its home matches at Rogers Arena, the 18,630-seat home of the Canucks.

That appetite for live action is certainly at the strategic forefront for Cineplex Entertainment LP, another entertainment giant looking to ride the e-sports wave.

The operator of Canada’s largest chain of movie theatres paid US$10-million four years ago to acquire WorldGaming, a platform used for leagues and tournaments for the competitive gaming sector.

While it uses some of its portfolio of 164 theatres across the country – 24 have been configured especially to accommodate e-sports events – those venues aren’t ideal.

“We’re doing more [e-sports events] outside the theatres because the theatres can be a little limited,” says Wim Stocks, general manager and chief executive officer for WorldGaming. “You’re in your seat and you’re facing forward. There’s not a lot of socializing you can do.”

As a result, Cineplex is placing greater emphasis on its Rec Room concept. Currently operating at seven facilities across the country, the company has plans to increase that number to 15, with each, in essence, a one-stop entertainment space with footprints from 30,000 to 60,000 square feet. As well as sufficient space to hold e-sports events, the venues also contain bars and restaurants, as well as room for other group activities such as bowling and video games.

That versatility is a crucial part of Cineplex’s e-sports strategy.

“To program an e-sports-specific sort of real estate opportunity is tough because ... if you make it [programming] so customized, you can’t use it for anything else,” Mr. Stocks says. “You’re reliant then on having compelling programming every day … and that’s hard to do at this stage of time.”