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Sunday, Oct 1, 2023

LA Fitness Launching Boutique Fitness Concept

The parent company of gym chain LA Fitness is launching a new fitness concept not far from its Irvine headquarters.

Privately held Fitness International LLC, which is reported to have over 700 LA Fitness clubs nationwide and pre-pandemic was estimated to bring in over $1 billion in revenue, is in the early stages of building out a new facility at Irvine Co.’s Oak Creek Shopping Center, at the intersection of Alton Parkway and Jeffrey Road.

The site, a few miles away from Fitness International’s base at the Park Place office campus near John Wayne Airport, runs about 36,000 square feet and was last used by hardware store Orchard Hills Supply, according to real estate data.

Rather than open a traditional LA Fitness, a concept called Club Studio Fitness is being marketed by the company.

Club Studio will offer a “cutting-edge fitness experience that brings together boutique fitness classes and luxury amenities into one gym,” it says on its website.

Along with five fitness boutiques—including a cycling center, Pilates, a hot yoga studio and boxing area—it will also have traditional gym facilities and a pool at the location, it says.

The property, now vacant, was seeing a fair amount of early stage interior work underway as of late January, but is still several months away from being operational, workers on-site told the Business Journal.

Company representatives declined to comment on the new studio.

Xponential Similarities

The new concept is a twist on the offerings of Orange County’s second-largest fitness chain, Xponential Fitness Inc. (NYSE: XPOF), an Irvine-based multi-brand fitness franchisor.

Xponential, valued around $820 million following its 2021 initial public offering, has built up a portfolio of 10 niche fitness concepts like CycleBar, RowHouse and StretchLab, which have traditionally been based in smaller, stand-alone retail locations.

Founded in 2017 by Anthony Geisler—named a Business Journal Businessperson of the Year in January—Xponential is the fastest-growing company in the fitness industry thanks to an aggressive franchising strategy, and ranks No. 9 among the largest fitness operators in the country, according to data from trade industry magazine Club Industry.

Fitness International, pre-pandemic the country’s largest health club chain, now ranks No. 2 nationally by revenue, having fallen behind Chanhassen, Minn.-based Life Time since 2020, according to Club Fitness’ latest estimates.

Club Studio, in contrast to Xponential’s traditional business model, would take several boutique offerings—including some similar to existing Xponential brands—and place them under the same roof.

It’s where “you can do it all without going everywhere to do it,” its website said.

Larger existing LA Fitness gyms in OC often have a couple areas dedicated to similar boutique offerings, but not as many as what’s being offered at Club Fitness.

November Partnership

The news of Club Studio Fitness comes a few months after LA Fitness and Xponential Fitness struck a deal that will see at least 350 Xponential brand boutiques added to existing LA Fitness locations over the next five years.

The development agreement “will afford Xponential Fitness the opportunity to invite existing franchisees who own a studio with [an LA Fitness] location within their protected territory to open an Xponential brand studio inside of these locations,” according to the November announcement.

A membership to an Xponential brand studio within a LA Fitness facility will be available to existing gym members for an additional cost, according to the companies.

“We specifically chose [LA Fitness] because they are the largest business of that type,” Geisler told analysts after the deal was struck.

Xponential’s other brands include Club Pilates, YogaSix, Pure Barre, Stride, Rumble, Body Fit Training and AKT.

Xponential isn’t involved with the Club Studio concept now but could be at a later date, Geisler told the Business Journal late last week.

“Yes, we are aware of the project and indeed there will be an opportunity there for our brands as our relationship with LA Fitness is still a very strong and positive one,” Geisler said.

Experimental Efforts

Club Studio’s website indicates that there will be other locations for the concept, but outside Irvine none have been disclosed.

LA Fitness has a recent history of launching, and quickly ramping up, new gym initiatives.

At the start of 2020, the fitness chain launched Esporta Fitness, a rebranding of some existing LA Fitness locations starting with those in the greater Phoenix market.

Esporta Fitness currently has 23 locations in Southern California, two of which are in Santa Ana. 

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