All retail bankruptcies are not the same. Here's what you need to know
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24 Hour Health and fitness documents for individual bankruptcy and closes 100 fitness centers

By Steven Anderson / June 15, 2020

24 Hour Physical fitness stated Monday in its Chapter 11 submitting that it has secured $250 million in funding to help reopen some of its clubs and expects a the greater part of spots to be open by the end of June. Nevertheless, it really is rising as a more compact chain: It forever closed 100 US places in 14 states with about 300 golf equipment remaining.

“If it had been not for Covid-19 and its devastating results, we would not be filing for Chapter 11,” CEO Tony Ueber reported in a statement. “We hope to have sizeable funding with a route to restructuring our stability sheet and operations to make sure a resilient upcoming.”

He also reported the restructuring will outcome in “reinvestment in our current golf equipment, opening new clubs and introducing several new innovative merchandise and solutions.” 24 Hour Health, which started in 1985, is a privately held enterprise.

Middle-tier health club chains are having difficulties with customers switching to less-expensive fitness amenities, these kinds of as Earth Physical fitness. Individuals are also flocking to boutique studio classes, which includes OrangeTheory, or in-property options, these kinds of as Peloton, which not long ago documented a surge in associates mainly because of the pandemic.

Gold’s Fitness center, a comparable chain to 24 Hour Health, filed for personal bankruptcy in May. The corporation stated the virus impacted it “deeply and in quite a few strategies,” which included the temporary closures of a lot of of its 700 world gyms. Gold’s forever closed 30 places in April and expects to emerge from personal bankruptcy in August.

Also on Monday, the owner of New York Athletics Club and selection of other gyms predominantly on the East Coast warned it’s contemplating personal bankruptcy mainly because of the momentary closures sparked by the pandemic.

Town Athletics Intercontinental (CLUB) stated in a regulatory filing that the “scope and duration of the interruption to our operations has significantly reduced our dollars movement.” To protect income, it laid off much of its 7,000 persons workforce and stopped having to pay lease.

Town owns around 200 gyms, such as Sports Club branded spots in Boston, Philadelphia and Washington, DC, and also Lucille Roberts, a women’s-only gymnasium in New York.

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