Padel – a sport for the ages or a craze?

Following our recent advice on the structure of a joint venture relating to a franchise Padel team, AD/vantage, and our attendance at its debut tournament, the Hexagon Cup, we have taken this opportunity to explain some of the reasons for the sport’s recent growth and how other European markets have reacted to its rise.

A racquet sport originating in South America, Padel has witnessed a surge in popularity across Europe over the last ten years. This growth can be attributed to multiple factors encouraging the sport’s expansion and solidifying its popularity in the region.

Accessibility is one of the key factors driving the growth of Padel in Europe. Unlike more physically demanding racquet sports such as tennis and squash, Padel can be enjoyed by people of all ages and skill levels. Its smaller court size (20 x 10 meters) and the fact that it is played predominately with four players makes it easier for beginners to pick up, whilst still challenging the more experienced players.

Its accessibility has increased participation amongst younger and older players, with Padel clubs popping up in cities and towns across Europe with Spain being home to over 14,000 courts, Italy increasing from around 1,000 courts four years ago to over 5,000 to date and, whilst the UK pales in comparison, its numbers have still tripled since 2020 to over 300 courts.

Investment has been crucial in the development of Padel infrastructure across Europe. From the construction of new Padel facilities to the renovation of existing tennis clubs to cater for the increase in demand in the sport. Significant capital has been injected into creating environments for the sport to grow, with investor companies such as Game4Padel in the UK and Padel Hero in Italy, retail and institutional investors are backing the sport’s continued growth across the continent.

Additionally, investment has contributed to the professionalisation of Padel. Major tournaments like the World Padel Tour and the recent Hexagon Cup, have both been held in Spain and with them we have seen associated franchise teams, sponsorship deals and media coverage with the latter being streamed on ITVX.

However, at what point does the growth and interest in the sport stagnate and become unsustainable? The Padel “Craze” has gripped the Nordic region since 2015 with courts in Sweden increasing from under 20 in 2014 to over 4,000. Such growth, however, led to increased competition and a driving down of prices, coupled with rising costs of maintenance has ultimately resulted in over 75 Padel-related entities in 2023 filing for bankruptcy and Padel facilities all over Sweden being converted into warehouses or other commercial premises.

On the whole, the future of Padel in Europe still appears promising. In the UK at this moment in time it is only going one way with the increased support from investors, governing bodies (such as the Lawn Tennis Association), and sponsorship deals, Padel seems poised to increase its popularity and consolidate its position as one of the continent’s most popular sports. However, it is essential that investors take note of the bursting of the Padel “bubble” in the Nordic region where, although the sport remains popular, such interest has waned, and investments need to be directed sensibly with so many players in the market attempting to capitalise on the sport’s initial uptake and public’s interest.

At Edwin Coe LLP, our Corporate team takes particular interest in the sectors our clients operate in meaning they are well placed to advise on, and draft, bespoke joint venture agreements, as well as associated constitutional documents for companies across multiple sectors and industries. Please contact Henry Wright or another member of the Corporate team should you require any assistance.

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