Surfing has long been a symbol for an aspirational coastal lifestyle. Now, with improvements in artificial wave technology, real estate firms are bringing the sport to unexpected areas including the Phoenix desert and the Denver mountains.
Among the more ambitious firms is Aventuur, a Los Angeles-based development company that wants to build ground-up projects in Austin and Dallas in Texas, Atlanta, Phoenix, Denver, Las Vegas, Nashville, Tennessee, and Jacksonville, Florida. Each site is designed to revolve around a high-capacity surf pool — capable of generating 1,000 waves per hour — paired with hospitality, retail and residential components.
The firm was founded in 2019 by former Deutsche Bank financier Nicholas Edelman and Fox River Partners alum Richard Duff. It doesn't yet have any open surf parks, but its first such project is underway in Auckland, New Zealand, with a second slated to break ground this year in Perth, Australia. The developer faces a competitive and evolving landscape, particularly from legendary surfer Kelly Slater, who has his own wave technology and is building a network of surf pools across the globe.
Aventuur cofounder and CEO Nicholas Edelman says the concept could generate real estate returns that rival top-performing asset classes. The growth comes during a period of evolution for the retail and hospitality industry, with consumers favoring activities, events and diversified shopping hubs over more traditional brick-and-mortar stores.
"This isn’t a loss leader. This is a profit center with place-making power,” Edelman told CoStar News. He said the surf parks — using technology from a company called Wavegarden — are expected to generate $10 million in net operating income annually, with margins approaching 50%, before factoring in land sales and retail lease income.
The global surf park and wave pool industry is valued at $4 billion, with forecasts of 20% annual growth, according to trade group Surf Park Central. The U.S. is wide open, with only a few parks completed and a few more planned.
“A surf park is a unique draw for areas without beach access,” Avison Young Principal of Retail Capital Markets Chris Maling told CoStar News. Maling argued it is no novelty — but a demand driver that keeps young, thrill-seeking consumers engaged before and after they surf.
Still, the industry faces varied headwinds in the form of high borrowing costs for development and economic uncertainty that could hinder consumer demand for expensive experiences.
Heightened competition
Wave pools are nothing new, and slow surf simulators by companies like FlowRider have been operating for decades in compact settings like cruise ships, restaurants and hotels, producing continuous waves over a shallow pool that are entertaining for beginners but don't mirror a realistic ocean experience that regular surfers crave.
But recent tech advances in hydraulic, pneumatic and mechanical systems can now produce long, rideable waves suitable for drawing tourists and even permanent residents, with some projects selling homes alongside wave pools. Wavegarden technology creates ocean-quality waves in rapid succession along a central pier in a lagoon.
Some 20 surf parks are operating worldwide, with four open in the U.S. and several opening in the next two years. Kelly Slater Wave Co., with its own proprietary wave technology, operates a complex at Surf Ranch in Kings County, California, and provides its technology to the Surf Abu Dhabi leisure center in the United Arab Emirates.
Europe has been a hotbed of surf park development, while Texas is one of these epicenters in the U.S. The Waco Surf complex added its 2-acre lagoon in 2018 on a 500-acre property that also features a traditional water park and other amenities.
"Waco Surf in Texas is seeing customers from New York and Los Angeles fly in for $5,000 surf weekends,” Edelman said. “That gives you an indication of demand for these experiences.”
Discovery Land Company and Slater broke ground in January on Austin Surf Club in Texas, a mixed-use community with a water basin using Slater's proprietary wave technology. Fifteen miles away, another surf park is inching forward at a development called Pura Vida in suburban Mustang Ridge. In Houston, a 6-acre surf lagoon capable of accommodating up to 70 surfers per hour is scheduled to open this year at Generation Park.
Other surf-anchored master plans are taking shape coast to coast, from a 6-acre lagoon underway in Richmond, Virginia, to a concept under construction in Arizona, to California's Palm Desert. That's where Beach Street Development and Desert Wave Ventures have broken ground on DSRT Surf, a resort anchored by a 5.5-acre Wavegarden surf park with for-sale villas, an upscale hotel and retail with a planned summer 2026 opening. Beach Street is also seeking to expand in Washington, D.C., and New York City.
Aventuur aims to compete in part with exclusive Wavegarden rights in eight U.S. markets, according to Edelman. The first North American surf park using the technology is set to open this year in Virginia Beach, Virginia, as part of one of the biggest public-private partnerships in the city's history: the $350 million Atlantic Park development, which includes 300 residences and an entertainment venue. In Myrtle Beach, South Carolina, a group of investors plans to build an entertainment district anchored by a Wavegarden surf park called SurfWorks by 2026. Aventuur is not involved in those projects.
For the concept to scale, Aventuur must convince the public — and investors — that surf parks are more than a novelty.
“There’s no misunderstanding of surfing,” Edelman said. “There’s just misunderstanding of surf parks as an asset class.”
Surf parks could follow a path similar to other post-pandemic experiential venues like Topgolf. That concept initially boomed but is now seeing declining foot traffic and falling same-store sales, prompting owner Callaway to consider a spinoff. Topgolf recently said it expects revenue to decline this year, citing high prices, weakening consumer confidence and a slowdown in group events.
With spending on air travel, hotels and restaurants also on the downswing, developers face questions about whether activity-driven destinations can sustain momentum during periods of broader economic softness.
Surfing into development
Aventuur recently put 40 acres under contract in Jacksonville and is pursuing similar land strategies in other high-growth cities. The company prefers to own its sites rather than lease, allowing it to control development and sell off pieces to other companies to build hotels, multifamily housing and curated retail.
“People want more than a gym. They want an ecosystem that supports their lifestyle,” Edelman told CoStar News.
Each project is expected to revolve around three core zones: surf, health and leisure. Think saunas and plunge pools beside yoga studios, with a beach bar and a live events lawn in another part of the complex that's anchored by an artificial lagoon with the goal of attracting everyone from tourists to social media content creators and even Olympians.
Aventuur’s founders cut their teeth co-running Pegasus Surf Lodges in Indonesia, before pivoting to real estate after Wavegarden unveiled a more efficient surf pool model, which boosted wave production from 180 to 1,000 per hour. Artificial waves typically range from 2 to 6 feet in height. Waves under 3 feet are typically most suitable for beginners, while experts can surf waves topping 9 feet.
“The upgrade changed the math,” Edelman said. Each pool can now support up to 84 surfers at a time, boosting capacity and revenue, and allowing for large-scale development.
Aventuur’s master plans carve development parcels into seven pieces. The company keeps and operates the surf-centered core, then sells or codevelops the remaining land.
In Jacksonville, the firm is working with The PARC Group to integrate its surf park into a broader eTown master-planned community with a scheduled 2027 opening. The 40-acre site is set to include multifamily housing, a 130-key hotel and curated retail — all built around the surf-driven anchor.
It chooses target markets based on a model that analyzes climate, drive times, income levels, land costs and consumer behavior. The company identified locations where people would pay at least $65 for a surf hour, then filtered for infill zones where development can be profitable.
“It’s hard to underwrite a business like this if you don’t control the freehold,” Edelman said. “Freehold enables you to invest further in the asset, lets you participate in the placemaking upside, provides greater financial optionality and gives you downside protection."