A collective groan went up from the crowd following a missed shot and, shortly after, cheers and high-fives erupted among strangers. But this wasn’t in a bar or a sports arena.

Instead, on a World Cup weekend, those reactions filled the former Brothers Collateral Pawn Shop on Melrose Avenue in Los Angeles. It offered an early test of developer Diego Torres-Palma’s latest real estate bet: that experience-driven venues helped by a surge in live sports can breathe new life into historic buildings and create gathering places that consumers can’t replicate at home.

Torres-Palma recently opened Pawn Shop, a 7,800-square-foot sports-focused entertainment venue at 5901 Melrose Ave., transforming one of Melrose Avenue’s most recognizable buildings into a hospitality destination ahead of Los Angeles’ historic run of global sporting events, including the 2026 World Cup, 2027 Super Bowl and 2028 Olympics.

Pawn Shop’s debut aligns with growing demand for out-of-home entertainment. About 217 million visits were recorded at 20 leading entertainment concepts in 2025, roughly 12% above pre-pandemic levels, with visitors staying an average of 140 minutes, according to a recent JLL report.

The project preserves the former pawn shop’s bow trusses, exposed brick walls and industrial character while adding chef-driven dining, private viewing suites, 58 screens and a parking deck. Investors include former Dallas Mavericks owner and “Shark Tank” star Mark Cuban.

“Pawn Shop is not interested in monetizing food and beverage,” Torres-Palma said during a tour of the property. “We’re interested in monetizing moments, the moments of sports.”

Yet the opportunity comes with challenges. Los Angeles already has a crowded sports-bar landscape, while high construction, labor and operating costs mean new venues must generate consistent traffic beyond marquee events to remain profitable.

If the strategy succeeds, Pawn Shop could become the first location in a larger hospitality platform. Torres-Palma said he already sees opportunities to expand into sports-centric markets including Las Vegas and Dallas.

The project began not with a business plan but with a building that dates to 1930.

The property’s longtime owners, the Gintel family, operated the pawn shop for roughly 40 years. Torres-Palma said it became clear during negotiations that they hoped whoever purchased the building would preserve it rather than demolish it.

Torres-Palma first toured the property in late 2023. At the time, much of the building’s architectural character was hidden behind decades of drywall partitions and modifications.

He initially envisioned turning the property into an indoor pickleball club. That concept quickly collapsed after he discovered the ceiling height fell just short of regulation requirements.

The building itself, however, proved harder to abandon.

Exposed brick walls, bow trusses and a second-floor mezzanine reminded Torres-Palma of the kinds of properties he had sought out for earlier adaptive reuse projects in the Los Angeles area, including Benny Boy Brewing in Lincoln Heights and Farm Cup Coffee in West Adams.

Torres-Palma acquired the building and adjacent parking lot for about $5 million, or roughly $450 per square foot, during a difficult financing environment. He said the low basis — compared with the $700 to $1,200 per square foot he was seeing for comparable properties on Melrose and Santa Monica boulevards — gave him room to pursue a more ambitious redevelopment.

Today, Pawn Shop looks less like a traditional sports bar and more like a hybrid between a hospitality venue and a small arena.

Seven private suites overlook the main floor, creating elevated viewing spaces inspired by premium seating sections at stadiums and arenas. Guests can watch games from private rooms while remaining connected to the crowd below.

The design leans heavily into sports culture with photography from longtime NBA photographer Andy Bernstein and references to the Dodgers, UCLA and the Rose Bowl.

In addition to Cuban — who bought into the bar with a $1 million investment — other backers hail from sports roots. They include Los Angeles Dodgers President of Baseball Operations Andrew Friedman; former Olympian and Angel City FC captain Ali Riley; and former NBA player Chandler Parsons.

Pawn Shop’s food, with a menu ranging from kabayaki and peanuts, to pickle-brined fried chicken, is designed by James Beard Award-winning chef Tony Messina, formerly of renowned Boston restaurant Uni.

Similar sports-driven venues are also expanding. Denver-based Tom’s Watch Bar has grown to 19 locations nationwide after opening six venues in 2025 — including a second Los Angeles-area outpost next to Intuit Dome in Inglewood — and says it expects to add another seven to nine locations by the end of this year.

Meanwhile, immersive entertainment company Cosm has expanded beyond its inaugural Los Angeles venue at Hollywood Park with locations in Dallas and Atlanta and has announced plans for Detroit and Cleveland. Rather than a sports bar, Cosm offers immersive, dome-style sports viewing powered by massive LED displays.

Torres-Palma said conversations with neighbors repeatedly pointed toward the same need: a local gathering place where people could watch games, meet friends and spend time together.

Pawn Shop sits between Larchmont Village and several major entertainment and sports institutions, including Paramount Pictures, the Los Angeles Tennis Club and Wilshire Country Club. The site positions the venue near a mix of studio employees, longtime residents and affluent neighborhoods that Torres-Palma believes can support a community-oriented gathering place.

He deliberately avoided building a concept that would compete directly with the area’s established restaurant scene. Instead, he envisioned something closer to a community clubhouse anchored by sports.