Minneapolis St. Paul Business Journal
24/7 Fitness Will go Upscale
By John Vomhoff Jr. Steele Fitness is launching a line of upscale, 24-hour health clubs following its August acquisition by Snap Fitness Inc. The new Steele365 clubs will be between 5,000 and 6,000 square feet, comparable to a standard Snap Fitness location. They will feature high-end locker rooms, towel service, an around-the-clock concierge, complimentary group classes and access to Steele’s personal trainers.

Memberships at each site will start at $79 per month for the first 100 members, then at least $89 per month for those joining later. Most 24-hour clubs, such as those run by Chanhassen-based Snap, charge $39 to $49 per month. The new concept will launch Nov. 1, when two Steele Fitness locations — one in St. Paul and another in Excelsior — will be converted to the Steele365 format. The company will open a new location in Woodbury a month later.

Steele founder Steele Smiley wants to expand the concept nationwide starting in 2014, then internationally starting in 2015.

“This will be the most disruptive change in the health and fitness market in at least 10 years,” Smiley said. “No one in the 24-hour game services customers’ higher expectations. That’s our sweet spot.”

Steele365 clubs will cap membership at 300 to 400 users, compared to limits of between 700 and 1,000 at most small, 24-hour clubs.

Each Steele365 club will have 12 to 15 employees, including trainers, sales associates, concierges and cleaning crews. Steele’s larger personal-training clubs have 30 to 35 employees.

Steele365 will be more selective with real estate than Snap because it is targeting a more upscale demographic, Smiley said. Clubs will be spaced three to five miles apart, as compared to Snap’s typical radius of just two to three miles.

In addition to the plans for Steele365, Snap previously announced plans to integrate Steele’s personal-training platform into Snap locations and to expand the larger-format Steele Personal Training Clubs nationwide.

Golden Valley-based Steele operates three full-scale clubs, not including the two that will be converted to the Steele365 format. Those stores — located in Edina, Wayzata and downtown Minneapolis — include Under Armour retail boutiques.

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