Startup Costs

While the costs associated with opening an Anytime Fitness gym are typically lower than other concepts, we want to be upfront with you about what it takes to get your gym open. Below you’ll find a table that outlines the range of costs you’re likely to encounter. Available at no cost to you, our financing department can help you identify and select products to help you finance your gym.

The following is an example of average upfront costs: {Figures from FDD distributed 3/21.}

This table relates to the estimated initial investment for a start-up fitness center.

Notes
(1) None of these payments are refundable. These figures are estimates based on our experience in establishing and operating Anytime Fitness centers in the last 3 years and reflect the anticipated initial costs based on a lease for a “vanilla shell” or “as is” space for the operation of a 5,289 square foot Anytime Fitness center. The low end of the ranges provided all assume that you are financing these costs with a loan from the Small Business Administration (“SBA loan”) which generally requires a 15% cash injection from you. You may not qualify for an SBA loan and even if you do, you may be required to make a cash injection that is higher than 15%. Except where noted, the high estimate assumes you will pay cash.
(2) The Initial Franchise Fee is generally $42,500 for an Anytime Fitness center franchise. The Initial Franchise Fee for an Anytime Fitness Express franchise is generally $25,000. However, we charge other Initial Franchise Fees in certain specific circumstances. The low end of the range assumes you finance the $42,500 initial franchise fee with an SBA loan. The high end of the range assumes you pay cash. The Initial Franchise Fee is described in Item 5.
(3) The person you designate as the “Principal Operator” of your business must attend mandatory initial training in Woodbury, Minnesota or such other place we designate. In addition, if your Principal Operator is not a Principal Owner, then a Principal Owner must also attend and complete this training to our satisfaction before you open your Anytime Fitness center. While we do not charge you for this training, you do have to pay your travel and living expenses while you attend the training. Your actual cost will vary, depending on the distance to be traveled, your method of travel, and your personal circumstances.
(4) Our estimate for initial expenses for real estate and improvements assumes you will lease a “vanilla shell” or “as is” space of 5,289 square feet which, at a minimum, includes rooms that will work as an office, bathrooms, studio space, concrete floors, demised exterior walls, HVAC, roof, and utilities stubbed to the premises sufficient for an Anytime Fitness center. The above estimates anticipate costs equal to $59per square foot for the buildout, and assume that you will receive tenant improvement allowances of $26.38per square foot from your landlord. Our estimate assumes you must pay only the first month’s rent and a security deposit equal to another month’s rent. All our estimates are based on these assumptions. Our franchise model is based on minimizing overhead expenses, including real estate costs. Costs will vary in relation to the physical size and location of the fitness center. A lower cost center is one that would require fewer leasehold improvements and fewer equipment expenditures. The lower estimates assume the landlord will cover many of the leasehold improvement costs. You may also need to provide a larger security deposit and a personal guaranty of the lease. Moderate and higher cost fitness centers may require extensive interior renovations and additional equipment. The above figures do not include extensive renovations. However, we assumed the general contractor will include permitting fees in the construction costs. If you are receiving a leasehold improvement allowance from your landlord, the landlord may require you show them that you paid for the leasehold improvements before giving you the money. We have a program that is exercised at our sole discretion and may provide a short-term loan to qualified franchisees when that happens so that you can pay for those improvements, pending receipt of money from your landlord. The maximum amount we will finance for any franchisee is $150,000. We may not agree to provide you this loan. We require you pay us a 6% origination fee, but we do not charge interest on the loan, unless it is in default. The loan must be repaid at the earlier of (i) when the landlord pays the tenant improvement money, (ii) 90 days after the last cash distribution is made to you under the loan documents, or (iii) 30 days after you open your Anytime Fitness center. See Item 10 for additional details. As described in Item 8, you may be required to participate in our “Construction Management Services” program offered through our approved vendor to oversee the construction of your Anytime Fitness center. As of the issuance date of this Disclosure Document, we anticipate that the cost of the Construction Management Services will be $6,500 to $8,500. At this time, participation in the Construction Management Services program is optional, and the $8,500 cost is included in the high range estimates.
(5) As described in Item 5, we will create a Compliance Drawing of your center. You must obtain a Compliance Drawing from us. If you are developing a new Anytime Fitness center, we will provide you with one Compliance Drawing at no additional cost. We anticipate this design will be sufficient to provide to an architectural vendor to create your Construction Documents. If you are signing the Franchise Agreement as part of a franchise renewal or transfer and we determine that your Anytime Fitness center requires renovation or re-equipment, then you must pay us $250 for your Compliance Drawing, but we will credit $250 against your Monthly Fee if you complete all renovation and re-equipment requirements by the required due date. In either case, if you require additional Compliance Drawings, you must pay us $250 for each additional Compliance Drawing. You must retain a designated architectural vendor to create a complete set of detailed Construction Documents, and to obtain any required permits, and conform the premises to local ordinances or building codes. If you do not use our designated architectural vendor to create the Construction Documents and this is your first Anytime Fitness center, we will charge you a fee of $2,700 to review the Construction Documents created by another vendor. We do not construct, remodel or decorate your premises. The low estimate assumes standard tenant improvements within a structure, designed for commercial use, and excludes items such as structural modifications, site work, energy studies, surveys and/or exterior improvements. The high estimate takes into account additional code studies, energy calculations and minor exterior building improvements.
(6) The total cost of equipment will vary depending on various factors, including the size of your fitness center and the type of equipment you obtain. Some costs will vary in relation to the physical size of the fitness center and whether you purchase from our recommended sources or from others. The Base Technology fee includes ProVision’s ongoing support of the technology purchased through ProVision, technology services, proprietary and club management software, any applicable development updates and release updates, networking equipment and support, door reader technology, security and surveillance system, fitness scanning and/or monitoring equipment, sound system, and email hosting. In addition, the Base Technology Fee includes access to Anytime Health’s suite of products.
(7) We require you have an automated external defibrillator. This equipment will generally cost $1,000.
(8) The above amounts reflect our recommended package. The total cost of the signage will vary depending on various factors, including the size of your location, and local zoning requirements.
(9) This amount includes utility set-up and first month costs, permitting and licensing fees.
(10) If you are a new franchisee in the Anytime Fitness system and you open a new Anytime Fitness center, you will need to spend a minimum of between $11,000 and $23,000 (depending on your market Tier) for a Grand Opening and Ramp Up program as described in Items 6 and 11. Some franchisees, particularly people who sign Area Development Agreements to control an entire market, may spend more than $23,000 per center for grand opening advertising because they believe they will receive a return on that investment. If you operate an Anytime Fitness Express center, there is no minimum amount that you must spend on grand opening advertising, however, we have included up to a $5,000 grand opening spend as we recommend that you spend at least this much on grand opening activities.
(11) You will need to purchase and maintain in effect at all times during the term of the Franchise Agreement a bond for your business, which you must purchase from our designated surety bond vendor to secure your obligations to pre-paid members for membership fees and for pre-paid personal training revenue. Some state laws also require the purchase of a bond. Because the requirements vary by state, and may depend on your net worth, we cannot estimate the amount you will need to obtain a bond, or the assets you may need to collateralize that bond. We have negotiated a base rate of $250 per year for bonds through our designated vendor, however your actual cost may vary based on your individual circumstances. Further, you will need to purchase and maintain in effect at all times during the term of the Franchise Agreement a policy or policies of insurance, naming us and our affiliates as additional insureds on the face of each policy. You must have and maintain general liability insurance with complete operations coverage, broad form contractual liability coverage, property damage all with current minimum limits of $1,000,000 per person and $1,000,000 per occurrence, $3,000,000 in the aggregate, and other insurance in the types and amounts as we may require or as required by law. The insurance policy must be written by a carrier who has a minimum rating acceptable to us. Our insurance estimate assumes that you will personally operate your Anytime Fitness center and have no employees. Therefore, the estimates do not include premiums for worker’s compensation insurance, employer’s liability insurance or automobile liability insurance. Your insurance costs may be substantially higher if you have to buy employer’s liability insurance, automobile liability insurance, or any other insurance required by your landlord. Before you make a decision to purchase the franchise, you should confirm that insurance is available for a fitness center of the type you intend to operate, given that you will not staff the premises all of the time.
(12) These figures estimate your initial startup expenses during the initial 3 months. These figures are estimates and we cannot guarantee that you will not have additional expenses starting the business. We recommend that you have additional funds available to you to fund your business. Your costs will depend on factors such as: how the business is staffed, your sales and management skills, experience and business acumen; local economic conditions; the local market for your services; competition; and the ability to obtain favorable real estate and equipment rates. These costs include payroll expenses for a full-time personal trainer and two full-time employees. These costs do not include any owners’ draw amounts.
(13) These figures are estimates based on our experience in establishing and operating Anytime Fitness centers last year. Your actual expenses of establishing and operating this business could vary significantly from these estimates. It is possible to significantly exceed costs in any of the areas above. Some states have laws that require staffing or operational requirements that will significantly increase the amounts you will have to spend to open and operate your Anytime Fitness center. If your state requires you to have someone on the premises full-time or additional equipment on the premises, these costs may increase by $5,000 or more a month. You should review these figures carefully with a business and a legal advisor before making any decision to purchase the franchise. Except as specifically stated, we do not offer financing for any part of the initial investment. The availability and terms of financing will depend on factors like the availability of financing generally, your credit worthiness, your relationship with local banks, your experience in the fitness industry, and any additional collateral you may offer to a lender to secure the loan. Our estimates do not include any finance charges, interest or debt service obligations.