MOUNT PLEASANT -- Weeks before the grand local opening of the $4.5 million Gold's Gym, a franchise company bringing the international fitness club here has bought out Cardinal Fitness of Racine.
With the new 38,000-square-foot facility set to open mid-December, franchisees of the new Gold's Gym finalized its acquisition of the Cardinal Fitness location on Thursday, according to Jamie Nelson, a co-owner of Vertical Fitness Group that leased the former Office Depot at 5201 Washington Ave. for their 12th Gold's Gym.
"We're going to make this a gradual transition," Nelson said, adding they understand that some are used to and prefer smaller gyms. "That's our biggest concern - that members stay happy."
The local Gold's Gym had about 6,500 members before the acquisition and is now at 7,740 members with Cardinal Fitness, according to Nelson. Membership rates for the two gyms are similar and will remain the same, he said, between about $10 and $24, "which is why (the acquisition) worked."
Those who currently pay higher membership rates at Cardinal Fitness can "buy down" their rates for $49, Nelson said.
The club was struggling after Gold's Gym got into the market here, Nelson said. The temporary Gold's Gym at the former Blockbuster Video, 5055 Douglas Ave., opened earlier this summer.
"The gym had been struggling financially due to the economy," said Erich Brown, a co-owner and operator of Cardinal Fitness, which has been in the community for 3 1/2 years and was voted the best health club in The Journal Times Best of Racine County 2009. "We saw this as an opportunity to sell to a company that we felt could serve our membership base and employees the best."
Current Gold's Gym and Cardinal Fitness members can now use both temporary facilities, less than two miles from each other, until the new one opens next month. The scheduled grand opening is Dec. 19.
Shortly after that, Nelson said, the two smaller facilities will close.
For Cardinal Fitness members, he said, "Everything stays status quo."
He hoped to make the transition as smooth as possible for the 1,240 Cardinal Fitness members.
There were informational bulletins up at Cardinal Fitness, 5513 Durand Ave., Thursday, notifying members of the change. It highlighted some of the benefits of the transition, like the quadrupled gym size and other amenities the new facility will offer: a 12-by-10-foot movie screen in the Cardio Cinema, an exercise arcade and a three-lane, 75-foot salt-water pool.
An email will be sent out to Cardinal Fitness members soon about the transition, Nelson said.
The acquisition benefits all, Nelson said, because current Cardinal Fitness members get to move into the new facility soon and current Gold's members have a bigger temporary facility to use until then.
"We were busting at the seams over there," Nelson said, referring to the nearly 6,000-square foot temporary location.
More than a third of the current Cardinal Fitness members had already joined Gold's Gym and kept dual memberships at both until the grand opening, Nelson said. Now with the acquisition, they can cancel their Cardinal Fitness memberships and still be able to utilize both facilities.
Nelson said buying out "the best" smaller gym while building a new gym in the area is common practice for them, adding they previously passed on an opportunity to buy out Charter Fitness, which recently closed.
He declined to provide the specific amount of the buyout, only saying it was "well into six figures." Current Cardinal Fitness employees will stay on under the acquisition, Nelson said.
Clarification: The franchise company Vertical Fitness Group bringing Gold's Gym here has bought out Cardinal Fitness of Racine.