By Linda Taaffe
Packard Foundation unable to negotiate an extended lease with downtown gym
Reach Fitness Club in Los Altos is scheduled to close at the end of next month despite the David and Lucile Packard Foundation’s recent announcement to temporarily table plans to renovate the site as its new headquarters.
Officials from Packard and Reach announced last Friday that they were unable to negotiate an extended lease that was agreeable to both parties.
Mary Harvey, CEO of Reach Fitness, said the club would have had to more than double its $53-a-month membership dues if it had accepted Packard’s proposed lease agreement. Club officials made Packard the highest counteroffer that the club could afford, she added.
“Packard’s offer to extend the lease was simply not financially feasible,” Harvey said. “We made a good try. There’s nothing else we can do.”
Harvey said Packard’s offer to extend the lease came too late.
She said the center has lost a significant number of members since last March, when Packard purchased the Second Street building with the intent of moving its headquarters to the site by the end of this year.
Harvey said Reach officials had hoped to extend the lease at least 18 months while they continued their search for a new location.
Packard officials said they offered Reach tenancy through June 30, 2003, at a below-market-rate, providing the tenant be responsible for covering customary operating expenses.
The Spa of Los Altos, which occupies the same building, negociated a new lease with Packard and plans to remain open through June 2003.
Packard announced plans at the start of this year to consolidate five of the organization’s Los Altos offices into one location in the downtown area between San Antonio Road and Second Street.
Officials put those plans on hold earlier this month due to the recent uncertainty in the financial market. The foundation planned to negotiate new leases with its existing tenants.
The non-profit foundation will investigate other potential fitness operators for the Reach facility.
The Reach in Palo Alto will be unaffected by the Los Altos site’s closure, officials said.
