The Business of Surf Parks and the Real Estate Strategy Behind the Break

Monday, May 12, 2025

• Swell development: Surf parks are becoming real estate anchors that blend recreation, revenue, and placemaking.

• Property mate: CoStar is acquiring Domain to challenge REA Group and disrupt Australia’s property market with a tech-forward platform.

• DejaH2Q: OpenAI’s $100 billion Stargate project has states competing to host AI data centers.

• Multifamily outlook webinar: Join us May 20th to learn how data and tech are helping multifamily leaders adapt to tighter margins and rising renter demands. Sign up

Development

The Business of Surf Parks and the Real Estate Strategy Behind the Break

Surfing has always been more than a sport. It is a lifestyle, a culture, and increasingly, a catalyst for real estate development. Advances in wave-generation technology have removed the limitations of coastal geography, making it possible to bring surfing to inland locations. As a result, surf parks are becoming the centerpiece of ambitious mixed-use projects, capturing the attention of investors, city planners, and real estate professionals seeking to create dynamic, experience-driven destinations.

Surf parks are not just entertainment venues. They are carefully designed ecosystems generating revenue across hospitality, retail, wellness, and residential sectors. With programmable waves, consistent conditions, and broad appeal, they are helping shape new communities and breathe new life into underused land. Cities are getting involved, investors are taking notice, and operators are building brands with global reach.

But bringing a surf park to life is no simple task. The journey from concept to opening involves complex zoning, lengthy permitting, significant infrastructure coordination, and major capital investment. Behind the scenes, real estate strategy, technology selection, and public-private collaboration all play a role in determining success. The wave is just beginning to build, and its impact may reshape how places are designed, financed, and experienced for years to come.

Overheard

CoStar to Acquire Australia’s Domain in $1.9B Deal to Challenge REA

CoStar Group has struck a A$3 billion (US$1.92 billion) deal to acquire Australian property platform Domain, aiming to challenge News Corp’s REA Group with a better-capitalized and tech-forward alternative. The acquisition, which includes the 16.9% stake CoStar already holds, has support from Domain’s largest shareholder, Nine Entertainment, which will receive A$1.4 billion for its 60.1% stake. CoStar CEO Andy Florance says the company will invest heavily in modernizing Domain, bringing lessons from the U.S. platform Homes.com to disrupt what he calls an underinvested market.

Florance emphasized Domain’s potential to integrate with CoStar’s global commercial platform, LoopNet, and help monetize residential and commercial listings more effectively. Shareholders will vote on the deal in August, but if approved, it could ignite new competition in Australia’s digital property space and force incumbents like REA to invest more aggressively.

States Compete To Host Massive OpenAI Stargate Data Centers

OpenAI’s $100 billion Stargate initiative is triggering a nationwide scramble among states, local governments, and developers hoping to host a network of massive data centers intended to power the next wave of artificial intelligence. Backed by Oracle and SoftBank and announced by President Trump, the project promises as many as 100,000 jobs and is being likened to historic infrastructure efforts like the New Deal or the Transcontinental Railroad. More than 250 site proposals have poured in from at least 20 states, with regions offering land, tax breaks, and political goodwill in hopes of securing long-term tech investment and economic revival.

Yet the rush to attract Stargate is raising serious questions about the costs and benefits of data center development. Critics point out that despite their billion-dollar price tags, data centers offer few permanent jobs and put enormous strain on local energy and water supplies. Some states, such as Oregon and Arizona, have begun pushing back or imposing new regulations, while others like Pennsylvania are aggressively courting OpenAI. Observers warn the project resembles Amazon’s controversial HQ2 search, where cities gave away valuable development data and incentives with little return. As interest in AI surges, experts caution that governments must demand more than promises and press for lasting, equitable outcomes.

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Propmodo Daily is written and edited by Franco Faraudo with contributions from readers like you and the Propmodo team.

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