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| Type | Private |
|---|---|
| Genre | Fitness |
| Founded | 1983 |
| Founder(s) | Mark S. Mastrov |
| Headquarters | Carlsbad, California, USA |
| Employees | over 19,000 |
| Website | www.24hourfitness.com |
24 Hour Fitness is the world's largest (by memberships) privately owned and operated fitness center chain, and 3rd in number of clubs behind Gold's Gym and Fitness First of the UK. It currently has 425 clubs in the U.S.A. The company's corporate office is located in Carlsbad, California. The operations' headquarters is in San Ramon, California in the Bay area. 24 Hour Fitness has over 19,000 employees. The founder is Mark S. Mastrov and current CEO is Carl Liebert III. 24 Hour Fitness is currently a subsidiary of the private equity firm Forstmann Little & Company, since its acquisition in a $1.6 billion leveraged buyout in 2005.
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History
The company began as a one-club operation in 1983 called 24 Hour Nautilus. Mark Mastrov, Leonard Schlemm and a third partner began the firm, but eventually it was only Mastrov and Schlemm who continued its expansion.
In 1994, 24 Hour Nautilus partnered with McCown De Leeuw. Soon thereafter the Southern California-based Family Fitness Centers chain was acquired and renamed 24 Hour Fitness.
In 2004, 24 Hour Fitness became a sponsor of the 2004-2008 United States Olympic teams. The sponsorship grants memberships to some U.S. Olympic hopefuls and includes upgrades to some U.S. Olympic Training Centers across the country, including renovation of the facility in Colorado Springs, CO in 2004 to be followed by Lake Placid, NY and Chula Vista, CA.
24 Hour Fitness worked with NBC to develop a reality show, "The Biggest Loser", which featured 12 overweight contestants competing to lose weight over several months. The show aired in late 2004, early 2005, late 2006, 2007, and 2008
Current Operations
24 Hour Fitness has about 3 million members and nearly 400 clubs in 16 states, and over 20 clubs in five Asian countries. Besides the USA, it has centers in Asia (Singapore, Hong Kong, Taipei and Taichung in Taiwan, Beijing and Shanghai in China, and Kuala Lumpur, Malaysia) through its wholly owned subsidiary California Fitness. Its European clubs closed in the early 2000s. Its major competitors in the US are Anytime Fitness, Bally's, Gold's Gym, and LA Fitness . Its main competitors in Asia are also the same, plus the Fitness First Chain of Australia.
Its rapidly expanding affiliate California Wow Xperience (CEO is a former Cali Fitness executive), is a California Fitness offshoot, has member swap agreements with both chains, and runs 15 gyms located in Seoul and Daegu, Korea (4) and Bangkok, Chiang Mai and Pattaya, Thailand, including one female only club(10). In Asia, its major chain competitors are Fitness First and Gold's Gym.
24 Hour Fitness plans to have more than 1000 clubs in the next five years. With sponsorships with various celebrities and athletes such as Jackie Chan, Lance Armstrong, Shaquille O'Neal, And Andre Agassi.
The call center for 24 Hour Fitness is run by NARS (National Asset Recovery Services, Inc.), with 24 Hour Fitness Member Services being in the Republic of Panama. Collections services were once handled by Alliance One up until March 2008, when NARS took over collections for 24 Hour Fitness. The NARS collections department is out of Montego Bay, Jamaica.
Club Levels
24 Hour Fitness currently has 6 levels of Clubs: Fit-Lite, Express, Active, Sport, Super-Sport, and Ultra-Sport. In addition 24 Hour Fitness has signature clubs with Andre Agassi, Lance Armstrong, Magic Johnson, and Shaquille O'Neal, as well as Jackie Chan and Yao Ming in its clubs in Asia.
Ultra-Sport
Generally over 100,000+ Square Feet Amenities include Cardio Equipment, Free Weights, Group X Room, Kid's Club, Basketball Court, Pool, Tanning, Executive Lockers, Massage, Racquetball Club, Rock Climbing and Volleyball. There is only 1 open Ultra-Sport level club, located in Irvine, California. The Second Ultra-Sport level club is coming to New York City, New York on 31 August 2008, and the third is planned for Northern Colorado in 2009.
Super-Sport
Generally over 50,000+ Square Feet, Cardio Equipment, Free Weights, Group X Room, Kid's Club, Basketball Courts, Pool, Sauna, Steam Room, Jacuzzi and Tanning.
Some Super Sport Level have racquetball courts.
Sport
Generally over 35,000+ Square Feet, Cardio Equipment, Free Weights, Group X Room, Kid's Club, Basketball Courts, sauna, steam room, spa and Pool.
Active
Generally over 20,000+ Square Feet, Cardio Equipment, Free Weights, Group X Room, and a Kid's Club.
Express
Contains Cardio Equipment, Limited Free Weights, and Group X Room.
Fit-Lite
Contains cardio-resistance equipment, limited weight machines and small fitness mat. Set up to be a full body circuit to be completed in 30 minutes by rotating machines every 60 seconds when a notification bell chimes.
Controversy and criticism
Class action lawsuits
On February 7, 2005 a class action lawsuit was filed in the Superior Court for the County of San Francisco (Case No. CGC-05-438478) alleging 24 Hour Fitness conducted illegal business practices. The allegations include the collection of dues beyond the term of monthly membership agreements. Other allegations include failure to comply with statutory print size requirements on agreements. State law requires font sizes on contracts to be of size 14 or greater. The lawsuit pertains to those who entered into monthly membership agreements after January 1, 2002 and before January 1, 2006. The lawsuit is set to go to trial on April 2, 2007. On December 25, 2006, members of the Class were notified.
On November 10, 2005 a class action lawsuit was filed in the San Francisco County Superior Court regarding allegations of fraud and illegal business practices. In the lawsuit (Case No. CGC-05-446492), the plaintiff alleges "24 Hour Fitness took money from its monthly membership customers by continuing to withdraw money from customers’ checking or credit card accounts after the customers gave notice of their desire to quit." [1] 24 Hour Fitness is currently defending the case in San Francisco Superior Court.
The two class actions which were filed in San Francisco seek relief only on behalf of California residents. A nationwide class action, which seeks relief on behalf of members in all the states in which 24 Hour Fitness does business, was filed on October 2, 2006 in the United States District Court for the Central District of California, in Friedman, et al. v. 24 Hour Fitness USA, Inc., et al.
On March 7, 2007 a class action lawsuit was filed in the Superior Court for the County of San Diego (Case No. GIC-873193). Posadas-Romesberg, et al v. 24 Hour Fitness USA, Inc., et al. alleges 24 Hour Fitness violates California's Business and Professions Code for failing to pay Group Exercise instructors for the time they spend doing a number of work activities, including preparing class choreography, setting up the class space, clearing the class space, completing paperwork and finding replacement instructors as needed. [2] The action seeks relief only on behalf of instructors residing in California.
On July 30, 2007 a class action lawsuit against 24 Hour Fitness was settled in San Francisco Superior Court, though 24 Hour Fitness continues to deny any wrongdoing. The suit challenged the membership fees that were collected for several months after monthly members canceled their contracts. "Class members are entitled to choose settlement benefits, depending on their situation, including partial refunds, free personal training or membership upgrades, contract modifications and transferable 30 and 45 day Club Access Passes." [3]
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