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Merger Creates Large Player in Raleigh

RALEIGH, NC — Raleigh is seeing a whole new scene when it comes to fitness these days. In January, new kid on the block, Capital Fitness, merged with Spa Health Clubs by forming a new parent company, Capital Health Clubs, that is jointly owned by Capital Fitness, Spa Health Clubs Inc. and some minority investors, said Rick Quinn, former general manager of Capital Fitness and now CEO of the newly merged Capital Fitness Spa Health Clubs.

The market in the Triangle is competitive, Quinn said, and Capital Fitness as well as Jason Douglas, former owner of Spa Health Clubs and current COO of the new company, knew that strength was in numbers.

Douglas' father, Steve, founded Spa Health Clubs 29 years ago, building a reputation with seven clubs in town. Capital Fitness had one club in downtown Raleigh since 2002. With eight clubs and 34,000 members, the new company will be the second largest chain in the area.

Quinn, who has been a developer of fitness centers across the country for 14 years, said that the two companies share a commitment to service.

“Unfortunately, the country has been plagued with substandard clubs that over the years have given people a bad feeling towards the industry,” said Quinn. “Our centers will have local operators that understand the market. They will be medium-sized facilities focusing on member services, creating more inclusive and more affordable clubs. Most of all, we will respond to the fact that 80 percent of the country does not exercise, is out of shape and is fearful of joining a health club. Helping these people realize their fitness goals is our competitive edge.”

All new equipment will be added to each club. The facilities will be expanded and renovated to resemble the downtown Raleigh location, offering an upscale environment at a lower-scale price, including richer colors and dramatic artwork. New service programs such as childcare facilities, chiropractic, rehab and massage will also be featured, along with new and better group fitness classes and an all-new personal training program.

All but one of the clubs will be open 24 hours for maximum member access and satisfaction. Most locations offer indoor wet areas, which include pool, hot tub, sauna and steam room.

During January, the first month of the merger, the clubs saw a 17 percent membership increase, and Quinn said the bump wasn't due solely to New Year's resolutions.

“We've heavily increased our marketing and sales team training to get out there and bring members in. We are also working on retention,” Quinn said.

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