Third Space Limbers Up For London Takeover

LONDON, United Kingdom — Luxury health club operator Third Space has unveiled a new high-end gym; kickstarting ambitious growth plans for the British capital.

The opening of Third Space Tower Bridge, formerly 37 Degrees, reveals the first of a series of long-term expansion plans, following the brand’s 2014 acquisition by London-based investment group, Encore Capital.

With the support of Encore, a firm focused on backing entrepreneurial growth businesses, Third Space CEO Colin Waggett said the move will “tap into the underserved demand for full service, high-end health clubs, servicing consumers who are into fitness but who also demand high quality services in tune with contemporary London.”

Identifying opportunities in the market at the top end of health clubs, Encore Capital acquired The Reebok Sports Club in Canary Wharf in 2006, before pinpointing Third Space, along with 37 Degrees, as existing fitness operators with growth potential.

Merging the three operators under the Third Space banner, The Reebok Sports Club will undergo a rebrand in April of this year, increasing the Third Space portfolio to four venues including the Marylebone, Soho and Tower Bridge outposts.

Longer term expansion plans include an additional Islington location set to launch in 2017, which Waggett says will cater to the local demographic by fostering a strong family focus. But, further growth is likely to be steady and measured, with the brand aiming to open doors to between 10 and 15 clubs over the long term.

Explaining the current growth strategy, Waggett told Welltodo: “We’re not trying to get to 50 clubs, it’s not that kind of a business. It’s all about opening a small number of very high quality clubs.”

And in terms of how quickly he wants to grow, Waggett says if they were to open a new club every 12-24 months that would be a good thing.

At present, total revenue across the whole group is in the order of £25 million pounds and with over 16,000 members frequenting the premium health clubs, Waggett doesn’t see demand for this type of offering slowing.

As an extension of the brand’s success to date, Waggett is also exploring a new sector of the fitness market, revealing plans for the launch of a stand alone class based studio concept called ‘Another Space’, which will incorporate spinning, yoga and hiit/combat sessions.

Due to open in April, the boutique studio in Seven Dials, Covent Garden, will follow the popular pay-as-you-go model, which is currently driving the growth of the fitness industry.

Competing against the likes of 1Rebel, Barry’s Bootcamp and HeartCore, it will target consumers who aren’t willing to commit upwards of £100 per month for membership of one of the brand’s upscale health clubs and those who prefer a more flexible model.

Waggett told Welltodo that the concept will have a different identity to Third Space, but will be built upon the credibility and expertise it is seeking to become more widely known for.