Town Sports filed for chapter 11 bankruptcy [on Sept. 14] after facing debt coming due this fall as well as reduced cash flow and liquidity due to coronavirus-related closures.
Company executives need access to capital “so they can reopen the gyms with appropriate health and safety improvements, and comply with relevant consumer protection laws and obligations,” said Nicole Greenblatt, a lawyer representing Town Sports, during the court hearing.
After its bankruptcy filing, Town Sports sought to reassure its roughly 600,000 members that it wasn’t going out of business through postings on its gym brands’ websites.The company has requested to give back 22 location leases to its landlords and potentially reject 13 more locations, depending on lease negotiations.
This past spring, NYSC members were angry that the club was still charging them membership fees despite the COVID-19 closure. Town Sports did eventually offer refunds.
Gov. Cuomo allowed gyms to reopen with limited capacity in the city on Aug. 24.
In other local gym news, Ludlow Fitness on Delancey will not be reopening.