West Seattle (Athletic) Club update: Deadline set for $1.1 million payment

(WSB file photo of West Seattle Club)
By Tracy Record
West Seattle Blog editor

New information tonight from the ongoing proceedings related to the proprietor of the West Seattle Club (formerly the West Seattle Athletic Club). When last we wrote about this on September 3rd, the property’s owner was trying to reopen the most recent “unlawful detainer” complaint – an action that can lead to eviction – which had been put on hold when club proprietor Sam Adams filed for Chapter 11 bankruptcy organization in June.

On September 3rd, Adams, landlord John Pietromonaco, and their respective lawyers were in federal bankruptcy court downtown to argue over whether that hold (technically a stay) could be lifted. Adams hadn’t paid even the partial rent owed, his landlord’s lawyer David Tall argued, and had had enough time to do so. Judge Marc Barreca agreed the stay on the “unlawful detainer” proceedings could be lifted.

Though that case had been closed for lack of activity since the June stay, Tall filed to reopen it, and a King County Superior Court judge granted that request in mid-September. A hearing subsequently was set for yesterday morning in the Regional Justice Center courtroom where such cases are heard on Monday mornings if things haven’t been worked out before the hearing date. (When a similar action was scheduled for a hearing in February, it didn’t happen, because Adams had made a payment.)

This time, there was a hearing, albeit a brief one. The property owner’s lawyer Tall was there; no one was there on Adams’ behalf. But in these types of hearings, the documents usually say much more than the words actually spoken in court, so we waited to see them before writing this update, and by late today, they were available online.

Bottom line to the main document, an “agreed order”: If the landlord gets $1,150,000 by October 24th, the “unlawful detainer” case will be dismissed. According to the “agreed order,” that money is “being procured by financing to be extended to Hollystone Holdings Inc. pursuant to a loan contract already executed by Hollystone Holdings by its officer, Sam A. Adams.” The “agreed order” did not include any further details of that financing, but as noted in our last report, Adams’ lawyer told the bankruptcy judge in September that his client was pursuing a $3 million loan.

The “agreed order” also says that any and all “liens against the premises” must be paid with the expected loan money. Meantime, as this plays out in state court, Adams’ Chapter 11 case continues; documents in the federal file say one of the upcoming matters to be decided is the future of the club lease.

Chris October 7, 2014 (9:33 pm)

Adams, get out now, that place is not worth it.

joe October 7, 2014 (10:57 pm)

So Tracy or any lawyer who understands all this court lingo stuff. If Sam is SOL by that date does the property group get full control of the gym?

WSB October 7, 2014 (11:47 pm)

The document says they would have the right to take it back (see the first two parts). But they certainly also would have the right to extend the deadline, change their mind, etc.

joe October 8, 2014 (12:27 am)

If it comes to that, they should keep it. Through money into fixing all the equipment and the rest will fall im place and they will be making money instead of making nothing. The members do not care how pretty it looks, all they want is for things to work right. You would see a huge increase in members if everything worked right, probably a couple hundred members worth once word got out that everything at the gym was in working order

6dogslater October 8, 2014 (1:51 am)

So how does this, affect corporate memberships? Should I bail out now? I am on direct withdrawal for membership.

LM October 8, 2014 (7:18 am)

Is anyone even going to go to this place when the brand new fitness place opens up by Alaska and Fauntleroy?

Mel October 8, 2014 (8:20 am)

The funny part is that even a $3 million loan isn’t likely to keep the place open long. $1.1m to the landlord off the top, $110k/month ongoing rent, probably a half-million to do the serious repair work that needs to be done…the membership has cratered and there won’t be much left for marketing, especially after the CEO pays himself.
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And I doubt at this point that there’s even a viable business plan.
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The only thing that would make me come back is a sign with the words “NEW OWNERSHIP” and “COMPLETELY REMODELED” on it.

ktrapp October 8, 2014 (9:19 am)

It must be nice to be going through a personal bankruptcy, yet still be able to find someone willing to provide you with a $3 million loan!

WSB October 8, 2014 (9:33 am)

Just a datapoint since two comments have mentioned this so far: While I noted that a possible $3 million loan was mentioned at the September hearing (Adams’ lawyer asked the federal judge if his client could testify about it, but because of the hearing’s format, the judge said no), the documentation available so far regarding the hearing in state/county court this past Monday does NOT mention the specific amount of the financing for which Adams’ company Hollystone Holdings is now said to have a “loan contract.” – TR

daniel October 8, 2014 (10:23 am)

if he’s not paying for anything where are all the dues from the members going to?

jack October 8, 2014 (11:24 am)

This community is very new to the gym industry, so I’m not surprised people are still dumb enough to give them money. Sam Adams has closed down every club he’s ever bought. That building is a lemon. The equipment doesn’t need to be fixed most of it needs to be replaced, it’s outdated. Sam Adams doesn’t pay his staff and as a result his clubs will never succeed. La fitness is never coming to west Seattle, it’s going to burien. You can’t fit a 55000 square foot club on fauntleroy and Alaska so that rumor sounds stupid. La fitness would also have a presale site open that you can join while under construction which they don’t have. They won’t open a massive club without having some kind of member base. In summary, it’s not very smart to give money to Sam adams, give up on la fitness and find a mom and pops type of gym to join they usually practice good business

WSB October 8, 2014 (12:09 pm)

Hi, Jack. Just one correction, yes, LA Fitness is opening here, *and* in Burien. It’s not a rumor. It’s the sole tenant for the entirety of the retail space – which at one point was going to be a Whole Foods Market (that instead is now slated for The Whittaker, across the street at 4755 Fauntleroy Way SW) – in the project now known as Spruce, 3922 SW Alaska. We first spotted the name in the planset in 2012; toward the end of the year, the revised project, with LA Fitness incorporated in the renderings, was shown at the Design Commission:
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https://westseattleblog.com/2012/12/were-really-happy-to-get-the-hole-filled-new-owners-team-discusses-spruce-west-seattle-at-first-public-review
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The LA Fitness name also can be found in the DPD permit system. Re: presale, commenters pointed out a few months ago [edit: another commenter pointed this out while I was writing this] that it is going on at the site downtown, and we noticed the sign in the window at 2nd/Columbia while commuting home via bus from a downtown story last week. – TR

Donn October 8, 2014 (12:00 pm)

At the LA Fitness downtown at the corner of 2nd and Columbia, there is a sign about pre-sales available for the West Seattle location.

JTB October 8, 2014 (6:07 pm)

Jack, now you see why so many value the WSB.

WSB October 8, 2014 (6:17 pm)

Couple of new developments today that we hope to write about later tonight, including e-mail to club members, and a few court documents.

jack October 8, 2014 (8:33 pm)

With all of the complaints allstar has had and for good reason, makes me wonder how west Seattle will like la fitness. They are an awful gym when it comes to customer service, they also under charge so the crowding in west Seattle is going to get insane. Parking won’t fix the traffic coming into west Seattle and its already a nightmare leaving west Seattle. So with the tunnel not getting done anytime soon these geniuses are bringing a low rent gym to this community with more condos and no where near the infrastructure to handle this many people. As of now there is mo presale so we are talking a long time out for it being done. La fitness bought vision quest another low rent gym and that’s why downtown is selling a west Seattle location, but until you see an off site presale in west Seattle we are still ways away from that being open. This is a club that severely under pays its staff, which will always cause all the issues that allstar had only la has much deeper pockets so they don’t care as long as they have the real estate. Nice work west Seattle you were one of the few communities left that had small business culture. Now you just inherited the Wal-Mart of gyms, what’s sad is they don’t pay staff enough money to afford to live in west Seattle which always causes problems and high turn over. Wsb should go interview staff at la fitness locations that are open and ask their staff how much they like working there. You will have a real story of true corporate robbery right there. From my limited experience in Seattle la fitness doesn’t seem like a good for because I was always under the impression Seattle has the most progressive thinkers compared to other cities in this country, especially with wanting the minimum wage to go to up. If you ever want s break down of their pay structure and all the customer service issues I’d love to tell you, but just ask a current staff member and you will hear all about it.

AB October 8, 2014 (10:40 pm)

While I can’t agree with everything Jack says, I do know from personal experience that he’s right about the corporate giant-ness of LA Fitness – they have a really bad reputation in the industry for under valuing their staff; therefore offering a sub par product to their customer. It’s a really hard industry so I guess it’s the only way to “succeed”. It will be nice to have that corner developed and people will find what works for them between the new Y and LAF
There are a number of independent training studios that are open here too, because neither of those gyms have serious, quality training to offer. Hope it all works out!

Amy Thomson October 9, 2014 (8:50 am)

Currently the air conditioning is broken. The locker room feels like a swamp and it’s deeply uncomfortable to work out in the hot, humid workout spaces. No one knows when or if it will be fixed. This was once a great gym. So sad.

MK October 9, 2014 (9:28 am)

TR – Did you happen to get a copy of the email that was sent to members? As staff, we have not heard anything

WSB October 9, 2014 (9:34 am)

Hi! Yes, I did. Sorry, ran out of time last night. Stand by…

MK October 9, 2014 (10:29 am)

No problem! I can always count on the blog :)

Mel October 9, 2014 (10:59 am)

Jack certainly seems to have his finger on the pulse of the fitness industry in West Seattle…or is that his thumb…And the LA Fitness employees will qualify for Seattle’s $15 minimum wage, so there’s that.
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As far as a “letter to members,” the members have had letters written to them by Sam Adams before (remember the long list of things that were going to be fixed and upgraded by last December?), so that’s not going to instill much trust.
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The fitness industry is pretty crappy in general – it seems like all anyone wants to do is expand. So many local fitness “chains” have come and gone since I’ve lived here. Staff and members are the ones getting the short end of the stick.
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All you can really do is choose the lesser (to you) of two (or five, or ten) evils, or make yourself a home gym.

WSB October 9, 2014 (11:36 am)

Thanks, Mel, I was planning to check the archives on those before writing promised followup. And I suspect you’re being somewhat sardonic but … the minimum wage won’t actually hit $15 for some time.

Mel October 9, 2014 (11:54 am)

We’ll get a $15 minimum wage in West Seattle before we get rapid transit, so once again that’s something…

aka October 9, 2014 (11:57 am)

actually jack LA Fitness has improved their pay structure, and the gym that is opening here in west seattle will be a signature club, meaning the rates will be higher.

LA Fitness has also put it a new emphasis on personal training and service. They ran with a lot of vision quest ideas on service based ideas. So I for one am actually excited about LA Fitness, the crowded problem is a problem though.. so no argument there.

LA Fitness personal training also offers monthly payments rather than pay it all upfront but you can pay everything up front if you’d like.

joe October 9, 2014 (12:16 pm)

I am curious to see the information about this court document stuff Tracy mentioned last night

WSB October 9, 2014 (2:12 pm)

Joe- working on it. Had to go cover something in real-time (the port/Chamber lunch) but as soon as I add photos to that, barring breaking news, we’re back on this.

JWH October 9, 2014 (1:45 pm)

At a minimum please pay your employees!I can live with the fact that I can never get a towel, but those people have lives to live and must should be PAID,

Kate October 9, 2014 (7:49 pm)

Any word about when LA Fitness will open? Since leaving All Star a year ago I’ve been bouncing around at gyms across the bridge. Eager to come back local….

mike October 12, 2014 (9:32 pm)

Any new developments Tracy?

MK October 13, 2014 (8:53 am)

What mike said, updates? Thanks!!

BH October 13, 2014 (10:09 am)

It is curious that while the facility of WSC is in the “needs upgrades” category, the instructors are truly great. this, despite the paycheck issues.

Is it possible that the Y could achieve its expansion goals by taking this property and upgrading?

Kendra Williams October 13, 2014 (10:47 am)

The one unique feature of the WSC is the full size pool. Currently it is in good shape, the water is warm and clear. There is a large group of dedicated people who come to daily water aerobics classes. Does anyone know if LA Fitness offers these classes and how big their pools are?
I fully expect to find locks on the door one morning, but until then it still has the best instructors around.

WSB October 13, 2014 (11:42 am)

Regarding the Y, its response is that they considered the idea but one big obstacle: Club’s not for sale.

angela October 14, 2014 (3:37 pm)

It is unbelievable to me how many people are talking about LA FITNESS. The reason I love west Seattle is its not congested with chains of retail and restaurants. It’s local. Why would u want to not support Sam and hope for the best. Instead support a cheesy club like LA fitness? I hope this can be resolved soon. I’ve been a member for 10+. It’s hilarious to me a lot of u think LA fitness is great. OMG. If something happens ill likely join a crossfit gym around the corner

not worth it October 14, 2014 (8:56 pm)

So Sam let me see if I understand this correctly. Everything is suppose to be ok, and repairs are coming? But yet you can’t pay your employees on time, people got paid late and most checks bounced a couple weeks ago taking a full week to finally get them paid. And I herd people today talking about not getting paid today which they were suppose to. So, how is everything fine when you can’t even pay your employees? Here is an idea, just put a big countdown board up in the lobby for how many days you have left before the land lord walks in, kicks you out and takes over control of the gym!!!!

current employee October 14, 2014 (10:53 pm)

I work there, and was told there were no checks to handout today which is payday by the way. Gee, what a shock.

Kate October 15, 2014 (10:41 am)

Being healthy and in shape is more important to me than supporting local businesses. I’d much rather pay a chain gym and stay fit where the instructors are treated well and PAID than continue throwing away money at a gym that’s so severely declined and doesn’t care at all about their clients or instructors. Crossfit is great for those who can afford it, but not everyone can pay $200+ per month.

Kendra – yes, LA Fitness offers classes and the one due to open in W.Seattle is supposed to have a pool.

Karen October 16, 2014 (11:02 am)

In response to joe on oct 8th regarding cleanliness of
WSC: Members do care about it. Its so frustrating to
Have showers filled with mildew and locker space
With dirty carpet. Also never having any assurance that
There will be towels and other supplies that we pay for
Or that the pool and hot tub are at there appropriate
Temperatures or are adequately “chlorinated”. Also
Life guards are mostly absent and even when they hire a
Good one, the leave for lack of pay.

joe October 19, 2014 (10:09 am)

Any words, on if the land lord would be keeping the gym for themselves? Is this something they can comment on, not getting into details; just a simple yes or no?

Mel October 22, 2014 (9:29 am)

Joe, this is just one man’s guess, but I think the land owner stands to make a lot more money by tearing down the existing building and slapping up apartments. The only things that could stop them are proximity to the watershed (although that didn’t stop the development just east) and the steel mill (would you live in an apartment that shakes like an earthquake several times a day?).

WSB October 22, 2014 (9:33 am)

The zoning is commercial/industrial – IG2 U/85 – so I’m not sure if residential development would be allowed without a rezone.

JK October 22, 2014 (9:06 pm)

Mel,

The building doesn’t shake because of the steel mill. It shakes because the genius that Sam is has his washing machines stacked up right next to the cross beams of the building. When they wash the towels, and have all the washers/dryers on at the same time, it causes it to shake

Jennifer October 23, 2014 (12:11 am)

I love the natural light around the pool. I love the pool and the large private showers. Yeah, it’s a mildewy mess, but so’s the bathroom at my house. You can’t be too picky, y’know. I’ve been a member for years. Kind of a waste of money. I don’t use it enough. So, every time I visit I try to use at least $40 worth of hot water. I stopped by tonight to swim, and a sign was up that said the club would be closed tomorrow and Friday, and would re-open on Saturday. There was no one at the desk. Guy in the hall just waved me in. I am concerned about the employees and teachers, who have always been top notch.
One thing I have disliked about the recent owners’ taste in music is the rap and schlock pop they play throughout the club and in the locker rooms. It’s all connected to their one system. No slam on repetitive commercialized beats with semi-misogynistic lyrics, but I am around teenagers and hear enough of it already. I loved the new age stuff that the old Allstar folks used to play. A swim, a hot tub, and Paul Horn inside the Taj Majal on a Sunday night used to set me up for my work week. For however long Mr. Pietromonaco keeps the place open — a couple of weeks, maybe? — I sure hope he puts on some Eric Linder or Enya or some sort of chill New Age Soundings of some sort. I have really enjoyed that club throughout the years, and it is a bit sad to see it deteriorate. Some wonderful people and incredible instructors have worked there. I appreciate them all.