Trendy Matrix One Health Club Chain Files for Chapter 11
The trendy Matrix One health clubs, where members pay $1,000 to join and such celebrities as actor Tom Selleck, actress Cheryl Ladd and rock star Bruce Springsteen have been known to work out, has filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code.
Matrix One, also known as National Health Management Inc. in Van Nuys, listed $1.1 million in debts and $1.02 million in assets in its Chapter 11 petition filed Aug. 26. The company owns two Matrix One clubs in Beverly Hills and Westwood, and was majority partner in the third Matrix One club in Encino, which it has closed.
President James B. Leighton blamed the 4-year-old company’s problems on the Encino health club. The facility was never successful, he said, failing to attract the kind of wealthy customers that made the Beverly Hills and Westwood clubs profitable.
“Basically, the concept we had on the other side of the hill never took off in Encino,” Leighton said.
The concept was to attract fewer members but charge more money to join. Matrix’s $1,000 fee compares to as little as $150 to $400 to join other clubs. In return, Matrix offers more privacy and personal training from fitness instructors. In addition, Matrix’s monthly fee could range as high as $500, Leighton said, depending on the amount of personal training received.
The approach is a sharp contrast with major health clubs as Holiday Spa Health Clubs and Nautilus Plus, which seek to attract many customers by offering cheaper rates and more facilities.
Because of the privacy, Matrix One became popular among celebrities. Springsteen biographer Dave Marsh, for example, notes in his book “Glory Days” that the rock star and his wife, actress Julianne Phillips, worked out at the club when they began dating.
Matrix One was founded in 1983 by Leighton, Michael Greenwald and three other partners. Leighton eventually bought out the others. In addition to operating the health clubs, Matrix also sells sun-tanning equipment for manufacturers.
Its largest unsecured creditor is Klafsun, a maker of tanning equipment in Arlington Heights, Ill., which is owed $349,100.
Leighton said the firm is trying to sell the Encino club. On Monday, another club, Private Enterprise, was operating at the Encino site.
The Encino club was a joint venture between Matrix One, which owns 51%, and Epstein Management, which is owned by Dr. Karl Epstein, an Encino orthopedist. Epstein could not be reached for comment.
Leighton said traffic congestion on Ventura Boulevard near the Encino club was a problem. Also, he said, members had to pay for parking in the area.
Other health clubs in the area have also had problems, including a Jane Fonda Workout club in Encino that was closed in May, 1986, because it was unprofitable.
