Every gym seller leads with the member count. It is the right thing to lead with, because the equipment can be replaced and the fit-out is worth nothing once the lease ends. The members are the business.
But the number on its own tells you almost nothing. Here is what to check.
Active, not registered
Ask how many members paid in each of the last twelve months.
Gym databases never get cleaned. Someone who joined in 2023 and stopped coming is still in the system. The real number is usually well below the headline.
Monthly or annual
Six hundred monthly members and six hundred annual members are different purchases.
Monthly members can leave any month, and some will after a sale. Annual members have already paid, which means the buyer inherits the obligation without the money. If a gym collected AED 400,000 in annual fees and you take over in month three, you owe nine months of access to people who will pay nothing more.
Get the split and the deferred revenue figure in writing.
Retention beats growth
Eighty new members a month sounds strong until you find out seventy-five are leaving.
Ask for joiners and leavers month by month. If the seller cannot produce it, that tells you how the gym is run.
Where the revenue comes from
Membership is rarely all of it. Personal training, classes and supplements sit alongside.
Look hard at PT. If most of it belongs to two or three trainers with their own clients, that revenue leaves when they do. Ask how PT income is split across trainers and whether they are staying.
Corporate accounts
Good money, concentrated risk. One company not renewing can remove ten per cent of revenue overnight. Ask how many accounts, what share of revenue, and when they renew.
The lease decides everything
Members join a gym because it is near their home or office. Move it and most do not follow.
Two years remaining is a different asset from eight months, no matter how good the numbers look. Check the term, the rent escalation, and whether the landlord will transfer at all.
What moves the price
Value rises with predictability. Long retention, monthly recurring payments, revenue spread across many trainers, and a secure lease.
It falls with churn, heavy discounting, one dominant corporate client, deferred annual revenue, and a short lease.
Two gyms both doing AED 150,000 a month can be worth double or half of each other. The member count will not tell you which.
Ask these before you view
- How many members paid in each of the last twelve months?
- Monthly or annual, and what is the deferred revenue today?
- Joiners and leavers, month by month, for a year?
- What share of revenue is membership, PT and other?
- How is PT split across trainers, and are they staying?
- Corporate accounts: how many, what share, when do they renew?
- How long on the lease, and will the landlord transfer it?
A seller who answers all seven properly runs a good gym. That is worth knowing before you discuss price.
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