Getbig Bodybuilding Boards > Gym/Stores/Industry Business Board
Gym Owners Talk
windsor88:
--- Quote from: onlyme on March 03, 2007, 10:42:51 AM ---I live in one of the most expensive places on earth and rent here for most gyms are around $1 to $2 a foot. The 24 Hour Fitness on Kapiolani pays about $2 a sq. ft. and their gym is just over 54,000 sq. ft. The Golds in Honolulu pays just over a dollar a foot and they are 25,000 sq. ft. The gym we were developing on Oahu in the mid 90's was 160,000 sq. ft. and the rent was $99,000 a month with $34,000 in CAM ($133,000 total). The rent at the Golds i owned here in Kona was $1 a foot for 14,000 sq. ft. The gym we are looking at now is in prime location on the main street and it is $1 a foot at 26,000 sq. ft. I can't imagine having to pay those rates you guys are paying. I also couldn't see having a gym under 10,000 sq. ft. But, here we are limited to the number of gyms. You need to get industrial property and get it rezoned or find a mixed-use property.
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Damn dude 160,000 sq ft. You could put living quarters up in that place. How many clients do you need to make a living? How long did it take to get your customer base. Man that is a phenomenal gym man. :o
ARMZ:
160,000 sq ft gym sounds like something us gym owners only dream about.. Never happened, never will.. Anything over 100,000 sf would be way too much for any membership base to cover the cost of overhead.. I'm happy with 15,000 sq ft tops and if you knew how much I pay you'd be wanting to partner up with me fast.. ;D
windsor88:
--- Quote from: ARMZ on March 03, 2007, 11:43:53 PM ---160,000 sq ft gym sounds like something us gym owners only dream about.. Never happened, never will.. Anything over 100,000 sf would be way too much for any membership base to cover the cost of overhead.. I'm happy with 15,000 sq ft tops and if you knew how much I pay you'd be wanting to partner up with me fast.. ;D
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alright ARMZ....how good of a deal you get dude? ;D
I was scoping out these Steel buildings that you can get for around $5-$10 a sq ft. Of course that is only for the building material.
Here is a link for one. There are many out there though. http://www.buildingsguide.com/steel-shop-buildings.htm
Instead of throwing away money on rent I would think, in the long run anyway, this would be the way to go. I am guessing you could get a 30 year note. If you managed to stay in the biz for 10 - 15+ years you might have the structure and land paid for at the same price as rent while building equity.
Any Thoughts?
gunnz:
--- Quote from: windsor88 on March 04, 2007, 02:25:16 AM ---alright ARMZ....how good of a deal you get dude? ;D
I was scoping out these Steel buildings that you can get for around $5-$10 a sq ft. Of course that is only for the building material.
Here is a link for one. There are many out there though. http://www.buildingsguide.com/steel-shop-buildings.htm
Instead of throwing away money on rent I would think, in the long run anyway, this would be the way to go. I am guessing you could get a 30 year note. If you managed to stay in the biz for 10 - 15+ years you might have the structure and land paid for at the same price as rent while building equity.
Any Thoughts?
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You can't really go wrong with owning the real estate imo...... but you are going to need some money to get the loan. Paying for the building, land and equip, misc supplies... you are going to have to have a good net worth, good cash in the bank, good credit. figure 20% minimum down on the note.
onlyme:
--- Quote from: gunnz on March 03, 2007, 06:29:39 PM ---So the Golds you owned was $1 a foot for 14,000 sq ft, or $14,000 a month, right?
Where I live, and throughout much of the country (but not everywhere) they list square footage on an annual basis, so for your gym:
$14,000 per month rent x 12 months = $168,000 annual rent
$168,000 annual rent / 14,000 sq ft = $12.00 sq ft
So you are paying $1 sq ft monthly, or $12 sq ft annually. Not that different.
And the gym you were developing would have been listed at about $10 sq ft annual if I did my quick math right. Also not that different considering that was in the mid 90's.
A facility under 10,000 sq ft can fill a nich and be quite profitable! IMO alot of people are tired of the "medium" and "big box" gyms.
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Oh I thought you were talking monthly rent. Your are right then.
--- Quote from: ARMZ on March 03, 2007, 11:43:53 PM ---160,000 sq ft gym sounds like something us gym owners only dream about.. Never happened, never will.. Anything over 100,000 sf would be way too much for any membership base to cover the cost of overhead.. I'm happy with 15,000 sq ft tops and if you knew how much I pay you'd be wanting to partner up with me fast.. ;D
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I can't remember the exact overhead costs but close to 80% of the rent was covered trhough subleases I had setup involving, restaurant, travel agency, suntanning company, sports medicine, car detailing, personal trainers, etc. We had clsoe to 3,000 pre-signups before we officially broke ground. This is a very lengthy story but in short the developer stole the money and it never officially opened. They foreclosed on me and we shut everything down. None of the members lost any money and 100% of it was returned. Our projections had us at 10,000 members after the 18th month if I remember.
Now the gym here we are looking is a very successful operation. Payroll is high at $700,000+ last year but that can be fixed very easily. The rent is great. As opposd to buying the building without owning the land which makes it touchy. Plus the land lease is up in 2020 I think so buying the buildings aren't the smart thing to do. But the business is easily worth we are offering. It is just 26,000 sq. ft.
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