The sale of the Jewel Box Sports Club/LA club in Chestnut Hill, MA, from Equinox, New York, to Healthworks Fitness Centers, Boston, has fallen through.
Two sources told Club Industry today that the landlord of the building where the club is housed could not consummate the deal and that Healthworks and Equinox did not have problems coming to terms in the deal.
Mark Harrington Jr., president of Healthworks Fitness Centers, informed members of the Sports Club/LA club in a letter that Healthworks, Equinox and the landlord worked six weeks on negotiations that continued until late last Thursday before "it was clear that an impasse was reached."
"Due to numerous outside factors, we believe the terms of the lease would have made it impossible for any fitness club to succeed in the space," Harrington wrote. "As a local business serving the community for over 30 years, our priority is to ensure we are in the position to serve our members, employ our talented team of over 500 employees and contribute to the community for years to come. In the end, the economics of the lease would have left our company with a level of risk that was simply too high."
Harrington added Healthworks has extended offers to staff members of the Sports Club/LA club to work at its other locations, and many have accepted.
Reached this afternoon, Harrington told Club Industry: "We were really excited about the prospect of this acquisition and feel we could have offered a great premium fitness experience to the community. We're very disappointed that a deal could not be made."
A Boston Magazine report today includes an email sent by Equinox to members late Sunday night. In the email, Equinox COO Scott Rosen told members the sale would not be happening.
"When we wrote to you on July 28, we explained that the Sports Club/LA at Chestnut Hill was being acquired by Healthworks effective September 1," Rosen began the letter. "Unfortunately, due to circumstances beyond our control, we have been informed over the past twenty-four hours that the sale to Healthworks will not be happening."
Rosen went on to write that the club will remain open until Sept. 30 and will close after that. At that time, members can choose to use the Equinox Chestnut Hill club through Oct. 31 or receive a refund. Many group fitness instructors and personal trainers from the Sports Club/LA club will move to the Equinox Chestnut Hill club, Rosen wrote. (Equinox declined to comment to Club Industry for this story.)
Healthworks announced its deal to acquire the club from Equinox on July 28. Also that day, Equinox formally announced its acquisition of six of the Sports Club/LA clubs from Millennium Partners Sports Club Management, Boston. The seventh Sports Club/LA club in Chestnut Hill was the one Equinox sold to Healthworks.
Millennium Partners Sports Club Management opened the Jewel Box club in 2013 as a smaller version of its upscale Sports Club/LA model. The club in Chestnut Hill is about 33,000 square feet compared to the 115,000-square-foot club about eight miles away in downtown Boston. That downtown club is now run by Equinox.
Healthworks, which includes four women-only centers and two nonprofit women-only centers, had planned to take over management of the Chestnut Hill club on Sept. 1 and make it coed under a new brand. Healthworks also has a women-only facility in Chestnut Hill that is across the street from the Sports Club/LA club and about a half-mile up the same street from the Equinox Chestnut Hill club.
The first club of Healthworks' new coed brand, Republic Fitness, will open in the financial district at International Place in downtown Boston. Presales will begin in October, Harrington told Club Industry. Healthworks also operates two high-volume, low-price coed clubs called GymIt in the Boston area.