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Athletic Club has new owner

Posted: January 5, 2014 2:00 a.m.
Updated: January 5, 2014 2:00 a.m.

A 15-year lease was signed by new gym owner/operator, Wade Gates, on the Santa Clarita Athletic Center. New equipment and tenant improvements have already been made.

 

After languishing in declining conditions, a bankruptcy and changes in ownership, the Santa Clarita Athletic Club landed in the hands of privately owned gym and fitness club owner Wade Gates of Ohio.

The Newhall gym changed hands in October and several improvements are already underway - new paint in and out, cleaning up and new gym equipment brought in to meet the needs of today’s fitness client.

Terms of the lease were not made available, except for the fact that the 65,000 square foot space on Wiley Canyon has been leased by Gates for 15 years.

Irwin Hyman, senior vice president at NAI Capital, represented Gates in the transaction.

“The gym just needed some tender loving care after being run the last couple years by a trustee,” Hyman said.

Built in 1987, the former owner vacated the property and it went into foreclosure in the first quarter of 2013, according to CoStar. Investors purchased the property for $4 million.

The Santa Clarita Athletic Club had some loyal clientele that just weren’t being served, Hyman said. And because the club opens at 4 a.m., it serves a lot of police, firemen, and other professionals in the area that want to work out before commuting to work. Also, with the recent closure of the Spectrum Club in Valencia, the gym was able to accommodate some of the volleyball contingents that needed a place to play, Hyman said.

A former Simi Valley resident, with a sister and brother as Santa Clarita residents, and parents who live in Riverside – Gates’ wife was out at the local gym this past week overseeing some of the operations and improvements while he remained in Ohio. Gates wishes it was the other way around.

“It’s freakin’ cold in Ohio,” he laughed.

Gates, who has been in the fitness industry since 1986, specializes in taking underperforming gyms and turning them around. But, he operates his seven Premier Athletic Centers in Ohio as a mom and pop shop, he said.

Working without any other partners, Gates said problem solving comes naturally to him and that he can immediately spot what the problems are, identify what went wrong and restructure.

In some cases a gym goes bust because it has just been undercapitalized. Besides sprucing up the building, some $250,000 was spent bringing in gym equipment that is only about three years old from an L.A. Fitness that closed in Florida, he said.

In other cases a gym’s owner has just made poor decisions, Gates said. “They’re so focused on the sales, but this is a service industry.”

Hyman first became connected with Gates through a Dallas consultant that was looking for health club properties.

Gates usually turns failing gyms around and then keeps them; he usually doesn’t sell them, Hyman said.

“But, there’s a shortage of health clubs for private owners,” Hyman said. “The majority of the properties are corporate owned.”

Gates said his preview of this property was a positive one compared to other failing gyms that he’s taken over.

The gym had some 5,000 members when he bought the club, and he has increased that number already since taking over.

In addition to the workout rooms, the gym hosts a swimming pool, racquetball court and basketball court, fencing studio and more.

Ironically, with family in the area, Gates once stayed at a local hotel while visiting his brother and sister in Santa Clarita. The hotel had made arrangements with the gym so it could offer its guests gym facilities as a perk, and

Gates worked out at the gym, he said.

“I had no idea that years later I’d own it,” Gates said.

jana@signalscv.com
661-287-5599

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