CARMICHAEL (CBS13/CNN) — National gym chain 24 Hour Fitness has filed for bankruptcy after the coronavirus pandemic forced its facilities shut for months.
At least three local locations are on the chopping block.
24 Hour Fitness said Monday in its Chapter 11 filing that it has secured $250 million in funding to help reopen some of its clubs and expects a majority of locations to be open by the end of June. However, it’s emerging as a smaller chain: It permanently closed 100 US locations in 14 states with roughly 300 clubs remaining.
“If it were not for Covid-19 and its devastating effects, we would not be filing for Chapter 11,” CEO Tony Ueber said in a statement. “We expect to have substantial financing with a path to restructuring our balance sheet and operations to ensure a resilient future.”
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He also said the restructuring will result in “reinvestment in our existing clubs, opening new clubs and introducing several new innovative products and services.” 24 Hour Fitness, which began in 1985, is a privately held company.
The West Benjamin Holt Drive location in Stockton, the Arden Way location in Carmichael, and North Main Street gym in Manteca were all listed as slated to close permanently on the 24 Hour Fitness website.
Becky Neal and a few friends from the Sacramento Bike Hikers hit the road Monday because they couldn’t hit the gym.
“We are all very disappointed !” Said Neal.
They usually meet up at the 24 Hour Fitness in Carmichael on Arden way.
“It’s like bike riding. It’s social and then we stay fit that way,” she said.
As many members showed up to workout Monday morning they were surprised to find the doors locked.
“I am assuming the lease costs on this building are a lot higher than other parts of Sacramento County, so they want to get rid of those,” said Brian Atwell.
Attwell will have to find a new gym.
“So right now we workout at the house we have a bunch of equipment there, that is what we will be doing in the interim,” he said.
The trick will be finding one that’s close, there are other 24 Hour Fitness locations in the area.
“So the closest is Sylvan Corners, which is about six or seven miles and they say if you don’t have a gym within two miles, you won’t go to the gym on a regular basis,” said Neal.
Middle-tier gym chains are struggling with customers switching to less-expensive fitness facilities, such as Planet Fitness. People are also flocking to boutique studio classes, including OrangeTheory, or in-home alternatives, such as Peloton, which recently reported a surge in members because of the pandemic.
Gold’s Gym, a similar chain to 24 Hour Fitness, filed for bankruptcy in May. The company said the virus affected it “deeply and in many ways,” which included the temporary closures of many of its 700 global gyms. Gold’s permanently closed 30 locations in April and expects to emerge from bankruptcy in August.
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