Elev8 Fun is turning vacant department stores into indoor adventure parks that offer everything from laser tag and arcade games to go-karts and bowling. The company has two locations open in Tampa and Orlando, Florida, and four more in the pipeline that it expects to open within 12 months. The ownership team sees even more growth potential in Florida and is eyeing the Northeast as a likely first step in its national expansion. Commerce + Communities Today contributing editor Beth Mattson-Teig spoke with principal and managing partner David Goldfarb about Elev8 Fun’s real estate footprint and growth plans.

You’ve described your concept as a 2.0 version of Dave & Buster’s. Tell us a bit about the atmosphere you’re creating at Elev8 Fun.

Elev8 mimics one of our first locations, Xtreme Action Park in Fort Lauderdale. Xtreme Action is a 200,000-square-foot family entertainment center, which won an [American Amusement Machine Association] award in 2018 as the best family entertainment center in the country. [For that concept], we bought a 350,000-square-foot warehouse and converted the warehouse into [commercial] condos and used 200,000 square feet for entertainment. Xtreme Action Park was unusual because it was a warehouse that happened to be located on I-95, which is the main traffic corridor, and it had ample parking. It was so successful that we wanted to see how we could expand, but the location is really a unicorn. Our first thought was that all these department stores are going out of business within malls. Why don’t we see if we can buy [them]? We bought our first department store, a Sears, in 2019 in Sanford [north of Orlando], and then we bought another Sears in Tampa.

When did your first two Elev8 Fun adventure parks open?

We were going through construction when COVID hit, and we had a massive delay in opening. The first Elev8 opened Jan. 1, 2022, at the Seminole Towne Center mall in [Sanford], which is currently being redeveloped. They are demoing the property and putting in 700 apartments, a hotel and a Costco, as well as a lot of individual stores. It’s going to be extremely helpful to us. From there, we opened Elev8 in Tampa, and it’s doing excellent. It was a former Westfield property that was converted.

We’re taking 125,000 square feet and becoming what we call this 800-pound gorilla where we have everything for everyone from 4 years old up to 80 years old. We have indoor go-karts, approximately 180 arcade machines, laser tag, mini golf, bowling, a ropes course, an event space and our own food hall, which includes California Pizza Kitchen and MrBeast Burger, along with other big names.

Is Elev8 a spinoff from Xtreme Action Park, or is it evolving in different ways?

Xtreme was so successful, but it was hard to duplicate because it’s hard to buy that square footage with ample parking. The idea of these department stores came into play, and it has been extremely fruitful. Our first location in Sanford came with eight acres of parking, and we are now building a Marriott hotel on the property, which we’re doing as a joint venture. We’re expanding outside of our core business of family entertainment centers, and we’ve really become a real estate company. Originally, we bought these facilities for our own purpose, but we’ve figured out how to utilize the additional real estate for other purposes.

You have two locations open. What else do you have in the pipeline?

We went to [an] ICSC conference and met with Simon Property Group, and they really liked what we’re doing. Our next three locations are all in Simon malls. We bought directly from Simon at Jensen Beach, which is north of Palm Beach. That store will open in April, and it will be our third location. Our fourth store is in Miami, in a former Kohl’s. These are all approximately the same size, about 125,000 square feet. In August, we’re buying our fifth store in Jacksonville, and then we have a sixth location that will also be in [North] Miami. At every location, we own the real estate and do our own internal construction.

We’re looking to open as many as 10 more locations in Florida, and then we’re looking to head to the Northeast and start in New York and New Jersey.

How are you financing your growth?

So far, we have no debt. We have been purchasing these with all cash, including all the construction and all the attractions. Back in 2023, my first company was called PrimeTime Amusements, which was an arcade company. I sold that to a private equity group called H.I.G. Capital. By coincidence, two of my closest friends wanted to buy minority shares in Elev8, and they came in with me, so, the company is a combination of three friends, but I’m the principal and I own the majority of shares.

What do you look for in a potential location, especially as you expand in the Northeast?

We’re looking for areas with at least 300,000 people within a 20-mile radius. We’re looking to branch off with groups like Simon Property Group and Brookfield, among others, because they know how to run these malls. There are mall operators that are struggling, and large parts of malls are being redeveloped. We have no problem being an independent at the location as long as the mall is being redeveloped. As long as we’re in an area where the energy is good, we have no problem.

How do you see Elev8 fitting into the broader category of experiential entertainment?

We try to cater to all audiences. Now we’re implementing Elev8 Kids, which is an area for kids between ages 4 and 10. Then we have our food hall, which also includes a sports bar where we’ll have six to eight different food categories within our facility with all brand names and with full liquor. We’ll have about 65 TVs within the venue.

What kind of runway do you think the sector has?

There are not many options when you have a mall that consists of 1 million-plus square feet and these department stores within them. I would say that 95% of America can’t handle that much retail. They’re going to need subcategories, and entertainment is a major subcategory that brings in a lot of people. This is why we’re very welcome with operators like Simon Property Group.