Gym loans.
The basics
Gyms run on recurring membership revenue, which lenders like, and on equipment that depreciates on a schedule, which they watch, and the balance between the two shapes every file.
Fitness is one of the few operating businesses that comes with something close to contractual income. Members pay monthly, mostly by automatic draft, and a gym with a stable base has revenue arriving before the doors open each month. Lenders appreciate that. It is the most rental-like income stream in the special use category.
The complication is that a gym’s revenue is attached to people, not to leases, and people cancel. So underwriting concentrates on churn. A facility signing hundreds of new members every January while losing the same number by April is not growing, and the raw membership count will not reveal that. Lenders look at retention, average member tenure, and the shape of the year.
Format decides the comparison
The word gym covers businesses that barely resemble each other.
A big box facility competes on price and breadth, carries a large footprint and a substantial equipment package, and needs volume to work. A boutique studio charges several times as much per member for a class-based experience in a fraction of the space, and lives or dies on instructors and community. A franchise location sits somewhere in between, with brand recognition and a defined operating model in exchange for fees and standards. Specialty strength and performance facilities are their own thing again.
Ancillary revenue separates them further. Personal training, small group programming, nutrition and recovery services, and retail can add meaningfully to what each member produces. A gym with a strong training business is running two revenue lines rather than one, and lenders read that as useful diversification.
Each has a different cost structure and a different failure mode. When we take a gym file out, we make sure the lender is comparing it to the right peers, because a boutique studio judged against big box economics looks expensive per square foot and a big box judged against boutique revenue per member looks thin.
Equipment, build-out, and the reinvestment question
Gyms carry an unusual share of their value in things that wear out.
Cardio equipment takes constant use and shows its age quickly. Strength equipment lasts longer but eventually looks dated. Flooring, locker rooms, and the sound and lighting that set the atmosphere all need periodic attention. Members compare, sometimes daily, against the newer facility that opened two miles away.
Lenders factor this in. They want to know what has been spent recently, what the equipment package is actually worth today, and what the next few years require. A gym that has reinvested reads as a going concern. One that has run its equipment into the ground while distributing cash reads as a business with a deferred bill.
If you are financing a build-out or an equipment refresh, treat it as part of the plan rather than an afterthought. Tell us the format, the membership picture, and whether you own or lease. We shop it from there, with no obligation.
What lenders look at.
The things that move a gym file from "maybe" to a real quote.
Membership count and churn
Active members and how many cancel each month is the core metric. A gym holding members through the slow months after January is showing something a headline signup number cannot.
Revenue per member
Dues, personal training, small group programming, and retail all contribute. Lenders look at how much each member actually produces, since two gyms with identical headcounts can perform very differently.
Equipment age and replacement schedule
Cardio equipment wears out faster than strength equipment, and members notice. Lenders assess how much of the value is in the equipment package and when the next replacement cycle lands.
Format and competitive position
Big box, boutique studio, franchise, and specialty strength facilities compete on different terms. Lenders read the gym against its actual competitive set rather than against the category as a whole.
Lease or ownership of the space
When the operator owns the building, the underwriting leans on the real estate. When the space is leased, the remaining lease term and build-out investment become central to the conversation.
How these deals are usually structured.
Every lender prices differently and every file is its own case. Treat this as the shape of a typical gym deal, not a quote.
- Loan amount
- Generally $500,000 and up.
- Common capital sources
- Banks, credit unions, private money, and SBA for owner-operators who occupy the building they are financing.
- Typical purposes
- Purchase of a facility, refinance, build-out of a new location, equipment package financing as part of a larger deal, and expansion into adjacent space.
- How performance is measured
- Recurring membership revenue, churn, ancillary revenue per member, and the gym's position against nearby competitors.
- Timeline
- A soft LOI quote often within 24 to 48 hours once your scenario matches a lender's guidelines, and a hard LOI in one to two weeks.
Terms depend on the property, the sponsor, and the lender. Nothing here is a commitment to lend.
Other special use we finance.
Different property, same process.
Or see everything under special use.
Loan types we place on gym.
Gym questions.
Still have a question about gym? Start a request and our team will get you an answer.
Neither has a blanket advantage. Big box facilities spread risk across a large member base at a lower price point and carry heavy equipment and space costs. Boutique studios earn far more per member with a smaller footprint and are more dependent on instructors and community. Lenders underwrite whichever model you run, against the right comparison set.
It can do both. An established franchise brand brings a proven model, marketing support, and comparable performance data, which lenders find useful. It also brings franchise fees, build-out standards, and transfer approval requirements. Bring the franchise agreement early, because a lender will read it.
More than in most property types, which is exactly why it draws attention. A well-equipped facility carries real value in its equipment package, but that value declines on a schedule. Lenders separate real estate value from equipment value and look at where you are in the replacement cycle.
Often yes, though the deal shape changes. Without real estate as collateral, the file leans on business performance, the remaining lease term, and the build-out investment. If your plan is to eventually buy the building you occupy, that opens more options and is worth discussing early.
They expect it. Fitness has natural turnover and lenders know the seasonal pattern. What they look for is whether churn is stable and accounted for, or whether it is climbing. A gym that replaces its membership base every year is a very different risk than one with long-tenured members.
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