Gym chain Life Time Inc. has closed sale-leaseback deals for four properties for a total of $175 million.
The deals are with an institutional real estate investor “who has entered into multiple sale-and-leaseback transactions with the company in the past,” the Minnesota-based firm said in a statement. statement. The first two properties are scheduled to close before the end of March and the last two by the end of September.
“These transactions will allow us to continue to strengthen our balance sheet and fund the incredible growth opportunities in front of us,” Life Time CEO and Chairman Bahram Akradi said in the statement.
Gyms were among the hardest hit by the pandemic in 2020, but over the past year I have seen the return of business as restrictions were lifted, vaccination rates increased and the population grew comfortable inside again.
Life Time isn’t the only gym company on the rise.
Starting Strength, a boutique fitness franchise from Idaho, plans to expand to 20 more markets this year. The company, which bills itself as the world’s largest strength training brand with 14 locations, has tapped Joseph AmecAngelo and Daniel Duque of CBRE in Atlanta to lead the leasing efforts.
The team said it is on the hunt for highly trafficked commercial space between about 1K and 2K SF in urban markets.
“We look forward to working closely with early strength gyms to strategically expand the franchise to 100 locations over the next five years,” AmecAngelo said in a statement.
The return to gyms has been good news for physical fitness companies, but not so much for home fitness programs that have thrived during the pandemic, including Peloton. The company said this week that it plans to lay off 2,800 people and its executive director will step down.
“Peloton executives believed, like many, that behavioral changes in the pandemic would stick. That doesn’t seem to be the case as we see people reverting to their pre-pandemic routines,” Timothy Hubbard, assistant professor of administration at the University of Mendoza College of Business at Notre Dame, he told CBS in an email.
.
