Fitness chain Pure to meet creditors over closure of Hong Kong yoga centre as coronavirus drives industry to the brink

https://www.scmp.com/business/article/3174452/fitness-chain-pure-meet-creditors-over-closure-hong-kong-yoga-centre?utm_medium=partner&utm_campaign=contentexchange&utm_source=EdgeProp&utm_content=3174452 |

April 19, 2022 11:48 AM SGT

A subsidiary of one of Hong Kong's biggest fitness chain, Pure Group, will meet creditors later this month to discuss the recent closure of one of its yoga centres.

The chain, which has 22 yoga and fitness venues in the city, said a meeting of creditors will be held in the China United Centre on the morning of April 27. It made the announcement in a notice in the Post dated April 14, under the Companies (Winding Up and Miscellaneous Provisions) Ordinance.

The Pure chain closed the yoga centre at The Centrium in Central on March 31. The lease was held by its Pure Yoga (HK) unit.

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"This only relates to The Centrium club and does not impact colleagues or cardholder agreements. Teachers will be teaching at other Pure studios," said Gavin Black, interim CEO and chief financial officer at Pure Group.

The closed venue, measuring 10,800 square feet, was Pure's first yoga studio in the city, dating back to January 2002.

The company cited the increasing popularity of its newer and larger studios as well as "changing operating conditions" for the "difficult decision" to close the venue. The club was "no longer financially viable as members have been gravitating towards our newer clubs".

The chain has over 50,000 members and 1,300 staff in Hong Kong, Black said. It has to pay about US$4 million in rent a month in Hong Kong.

The largest yoga centre is in Langham Place, Mong Kok, measuring 35,000 square feet and hosting some 185 classes weekly, according to its website.

Black said the landscape for the fitness industry had changed because of the coronavirus pandemic, with a number of boutiques and larger chains having closed.

He remembered business being particularly tough last year when there were periodic outbreaks linked to gyms and dance studios that made people "nervous about going out to exercise".

All gyms across the city have been closed since early January as the government battles to contain the fearsome fifth wave of Covid-19.

Fitness First shut all eight of its gyms in Hong Kong in mid-March amid the "prolonged challenges" wrought by the coronavirus pandemic. It marked the first closures in the fitness industry since the shutdown at the start of the year.

Black said Pure is trying to help former members of Fitness First, offering deals to those who had credit.

The rest of Pure's clubs in Hong Kong will reopen on April 21, when the city's social distancing measures undergo a first phase of relaxation. Black did not expect any more closures for Pure.

"I am not surprised [by the closure]. The anti-epidemic fund is not enough to support fitness centres to pay their rents," said Gordon Yau, chairman of the investigative panel of Hong Kong Fitness Guide, an industry group launched in 2017.

"As I was informed by many fitness trainers and owners, they just got the funds yesterday, and that's ridiculous if the government wants to help companies to stay alive."

As fitness centres and sports venues open their doors again next week, pent-up demand is expected to be unleashed, but the industry needs about two months to monitor the situation, Yau said.

"At this moment, owners will try to seek opportunities to stay alive as nowadays every industry, except cleaning and online e-commerce, are affected," he added.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

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