24 Hour Fitness Files for Bankruptcy, Will Close 130 Locations
Gym chain 24 Hour Fitness filed for Chapter 11 bankruptcy in a Delaware court Monday, and expects to secure $250 million in financing to restructure its business, the company said in a statement.
As part of the restructuring, the San Ramon, Calif.-based company will permanently close 130 locations out of a total of roughly 450, the company stated. They include 25 locations in California, 26 in Texas, 10 in New York and seven in New Jersey.
“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.
All 24 Hour Fitness locations nationwide closed in March because of the coronavirus pandemic, and the company did not pay rent in April or May, according to data from Datex Property Solutions. Other fitness companies, including Equinox, also stopped paying rent at some or all locations while their sites were closed.
Now, with the reopening well underway across the country, gyms are currently permitted to be open in 43 states, per the New York Times, but it’s not clear how many have indeed reopened.
The privately-held 24 Hour Fitness says the restructuring will allow them to reopen their remaining sites, and allow for “reinvestment in our existing clubs, opening new clubs and introducing several new innovative products and services.”