Health clubs not sweating the recession

Colorado Athletic Club and Carmichael Training Systems among those expanding

It’s hard not to sweat during these uncertain economic times. Literally.
Although the recession has taken its toll on countless businesses across the state, Colorado’s health club industry continues to expand. “I think don’t think we’ve been hit as hard as retail businesses because people still value their health,” said Ed Williams, president of Denver-based Wellbridge, which owns and operates four Colorado Athletic Club locations and has plans to open two new clubs in Boulder and Denver. Nationwide, the brand has 20 locations. “When life becomes more stressful, people want to make themselves more healthy,” he said. One of the new Colorado Athletic Club sites will be in Boulder’s 29th Street Mall; it is planned to open by year’s end. The 14-year-old Colorado Athletic Club will also add its sixth Colorado fitness outlet in Denver’s Tabor Center. Williams, who founded Wellbridge 27 years ago, said the company is taking advantage of the down economy by building health clubs in good locations that were more expensive before the recession. “We’re facing the same obstacles as everyone else in this economy, but these locations were strong enough that we had to grab them when they were available,” Williams said. When the economy turns around, Williams said, the newly built sites will reap more benefits. That could mean increased membership and use of facilities. Currently, membership numbers at Colorado Athletic Club gyms have not increased, but use of facilities has gone up 30 to 40 percent, Williams said. That means instead of working out twice a week, people are now heading to the gym three or four times weekly. But Colorado Athletic Club is not the only health club chain expanding. Carmichael Training Systems, a state-of-the-art training outlet for high-endurance athletes opened a new location in Colorado Springs . And fitness studio Brio Active officially opened its doors in Cherry Hills Marketplace in Denver recently. Nationwide, franchises of the Irving, Texas-based Gold’s Gym have recently opened or are planned to open this year in several cities, from Fitchburg, Wis., to Midlothian, Va. Franchises are also planned in parts of the East Bay and Bay Area in San Francisco to take advantage of low-cost real estate.
The gym in Cherry Hills Marketplace is the pilot studio for Brio Active, which takes a “new approach to fitness and wellness” with a 25-minute full-body workout. Expert coaches move groups of four or fewer clients through warm-up, flexibility and strength exercises and complete each workout with a “recharging” massage.
The fitness studio chose Colorado as its first location because it is an “activity-oriented state” with many different markets to reach out to, including hardcore athletes as well as those who don’t exercise regularly, said Marsha Macro, manager of Brio Active. Sufferers of multiple sclerosis, arthritis and other physical ailments also find Brio Active’s approach beneficial, Macro said.”We have many fingers in the market right now, and we’re touching so many people,” Macro said. “We want to find out what works and grow with success. We plan to open more sites in Colorado and then go nationwide.”Macro said she expects membership to be slow during the summer because more people spend time outside during this season. But despite the state of the economy, she said, fitness remains a priority for many.”You need something that can take your mind off what’s happening,” Macro said

Health clubs not sweating the recession

Colorado Athletic Club and Carmichael Training Systems among those expanding

It’s hard not to sweat during these uncertain economic times. Literally.
Although the recession has taken its toll on countless businesses across the state, Colorado’s health club industry continues to expand. “I think don’t think we’ve been hit as hard as retail businesses because people still value their health,” said Ed Williams, president of Denver-based Wellbridge, which owns and operates four Colorado Athletic Club locations and has plans to open two new clubs in Boulder and Denver. Nationwide, the brand has 20 locations. “When life becomes more stressful, people want to make themselves more healthy,” he said. One of the new Colorado Athletic Club sites will be in Boulder’s 29th Street Mall; it is planned to open by year’s end. The 14-year-old Colorado Athletic Club will also add its sixth Colorado fitness outlet in Denver’s Tabor Center. Williams, who founded Wellbridge 27 years ago, said the company is taking advantage of the down economy by building health clubs in good locations that were more expensive before the recession. “We’re facing the same obstacles as everyone else in this economy, but these locations were strong enough that we had to grab them when they were available,” Williams said. When the economy turns around, Williams said, the newly built sites will reap more benefits. That could mean increased membership and use of facilities. Currently, membership numbers at Colorado Athletic Club gyms have not increased, but use of facilities has gone up 30 to 40 percent, Williams said. That means instead of working out twice a week, people are now heading to the gym three or four times weekly. But Colorado Athletic Club is not the only health club chain expanding. Carmichael Training Systems, a state-of-the-art training outlet for high-endurance athletes opened a new location in Colorado Springs . And fitness studio Brio Active officially opened its doors in Cherry Hills Marketplace in Denver recently. Nationwide, franchises of the Irving, Texas-based Gold’s Gym have recently opened or are planned to open this year in several cities, from Fitchburg, Wis., to Midlothian, Va. Franchises are also planned in parts of the East Bay and Bay Area in San Francisco to take advantage of low-cost real estate.
The gym in Cherry Hills Marketplace is the pilot studio for Brio Active, which takes a “new approach to fitness and wellness” with a 25-minute full-body workout. Expert coaches move groups of four or fewer clients through warm-up, flexibility and strength exercises and complete each workout with a “recharging” massage.
The fitness studio chose Colorado as its first location because it is an “activity-oriented state” with many different markets to reach out to, including hardcore athletes as well as those who don’t exercise regularly, said Marsha Macro, manager of Brio Active. Sufferers of multiple sclerosis, arthritis and other physical ailments also find Brio Active’s approach beneficial, Macro said.”We have many fingers in the market right now, and we’re touching so many people,” Macro said. “We want to find out what works and grow with success. We plan to open more sites in Colorado and then go nationwide.”Macro said she expects membership to be slow during the summer because more people spend time outside during this season. But despite the state of the economy, she said, fitness remains a priority for many.”You need something that can take your mind off what’s happening,” Macro said

Planet Fitness has extended hours at its corporate-owned clubs in New Hampshire to 24 hours a day, seven days a week. The change, announced on Planet Fitness’ Facebook page and Twitter account last week, affects 11 New Hampshire corporate clubs. The new hours also apply to two Planet Fitness corporate clubs in Massachusetts and two in Rhode Island. The 24-7 corporate clubs are staffed at all hours, says John Craig, director of brand development for Newington, NH-based Planet Fitness.“Given the 24-7 business cycle and the growing numbers of folks who work second and third shifts, we think it will help a lot of our members,” Craig says.
Most Planet Fitness franchise clubs are open around the clock weekdays until 9 p.m. Friday, Craig adds. On weekends, those clubs are open from 7 a.m. to 7 p.m.

Planet Fitness has extended hours at its corporate-owned clubs in New Hampshire to 24 hours a day, seven days a week. The change, announced on Planet Fitness’ Facebook page and Twitter account last week, affects 11 New Hampshire corporate clubs. The new hours also apply to two Planet Fitness corporate clubs in Massachusetts and two in Rhode Island. The 24-7 corporate clubs are staffed at all hours, says John Craig, director of brand development for Newington, NH-based Planet Fitness.“Given the 24-7 business cycle and the growing numbers of folks who work second and third shifts, we think it will help a lot of our members,” Craig says.
Most Planet Fitness franchise clubs are open around the clock weekdays until 9 p.m. Friday, Craig adds. On weekends, those clubs are open from 7 a.m. to 7 p.m.

Life Time Fitness Eyes $1 Billion and East Coast

As Life Time Fitness announced 9.5 percent revenue growth in the first quarter, its CEO said the company may hit $1 billion in revenue this year as it ramps up plans for growth in number of clubs and related businesses and as it increases spending on marketing to improve retention.

“Our goal of $1 billion in 2011 is achievable,” Bahram Akradi, chairman, president and CEO of the Chanhassen, MN-based company, said in a conference call with analysts announcing first quarter 2011 financial results. “We will do all we can do to achieve this milestone.”

Life Time Fitness’ first quarter 2011 revenue grew 9.5 percent to $240.6 million compared to $219.8 million from the same period last year. Net income for the quarter was $20.8 million compared to $17.8 million in first quarter 2011. Net income for the quarter was $20.8 million compared to net income of $17.8 million for first quarter 2010.

The company has 90 locations spread across 20 states, but Akradi said his primary area of interest for expansion is on the East Coast, where the company already has clubs in New York, New Jersey and Maryland. “We have some incredible sites in the works,” he said, although he wouldn’t give exact timing. “We are excited about the places we are going and the opportunities we have.” Life Time opened a club in Syosset, NY, in the first quarter. In May, the company will open two clubs—one in Colorado Springs, CO, and the other in Summerlin, NV. Life Time will expand much faster starting in the second half of this year and into 2012, Akradi says. The growth will be balanced between adding more locations and adding other businesses that support the healthy way of life approach that the Life Time clubs are targeting. Those businesses could be events (such as marathons), wellness services or chiropractic services. Akradi, who said that the company reviews dues pricing at each club monthly, plans to increase dues and enrollment fees at some clubs. In particular, the company is increasing dues for members who were given discounts to attract them from lower-priced clubs that had gone out of business. “My vision is every member in every club will pay the same rate,” Akradi said. “And we wouldn’t have special prices for anyone.” The company would be able to justify those higher prices by differentiating on services and programming. “Our goal is to differentiate Life Time Fitness so we don’t have to play in the price segment,” he said, noting that Life Time’s average member price compared to all other national chains is two to three times more. “So, we have focused ourselves on delivering programs—not just equipment—high-quality people and well-run facilities. We want to get to the point where price is not a factor. I feel we are 80 percent there from two years ago. I’m comfortable with the way we have strengthened our brand.” For the year, Akradi expects revenue to increase 7 percent to 9 percent or $980 million to $995 million, primarily due to growth in in-center revenue and corporate businesses, as well as membership growth in new and ramping centers. Net income is expected to increase 14 percent to 18 percent or $92 million to $95 million. Memberships in the first quarter grew 6 percent to 650,784 from 613,882 at the end of first quarter 2010. Quarterly attrition in first quarter 2011 was 8.4 percent, down from 8.5 percent in the prior-year period. Attrition for the trailing 12-month period was 36.1 percent compared to trailing 12-month attrition of 39.3 percent at the end of first quarter 2010.

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