CHANHASSEN, MN -- Life Time Fitness announced Wednesday a new $34 million credit facility to provide permanent financing for its corporate headquarters in Chanhassen, MN, and a fitness club in Overland Park, KS.
General Electric Capital Corp. (GECC) is providing a letter of credit, which expires June 1, 2023, to Life Time Fitness in the amount of $34,235,000. The notes, which mature July 1, 2033, have an initial interest rate of 2.38 percent. Life Time will pay GECC a 1.4 percent annual fee, as well as other drawing and reimbursement fees.
Life Time also announced that U.S. Bank National Association has increased its commitment under an existing agreement from $400 million to $470 million at current rates and terms. Life Time Fitness may increase the total amount of the facility up to $600 million.
Life Time will continue to use this credit facility to finance the construction and development of new clubs. As of Wednesday, Life Time operated 74 clubs in 17 states. The company announced in April that it plans to have 11 new clubs this year and 11 new clubs in 2009.
“We believe that these arrangements indicate confidence in our business model and growth plan,” Life Time Chief Financial Officer Michael Robinson said in a statement.