A luxury boxing gym faces shutdown as it now files for a painful bankruptcy due to its disparity between its assets and debts.
The BXNG Club, a longtime luxury boxing gym with a total of four locations in San Diego, has now filed for bankruptcy as it contends with massive debt amid rapid expansion over the last few years.
The BXNG Club, which asserts itself as the “fastest-growing combat sports and fitness brand” in Southern California, opened most of its locations within the last five years.
The gym’s owners filed for Chapter 11 bankruptcy late last month, due to a $600,000 disparity between its assets as well as its debts.
According to court filings, it currently has $5.1 million in assets and $5.7 million in debts.
The ongoing bankruptcy casts doubt over how the luxury gym will be able to stay afloat all while planning an opening of a fifth location in Los Angeles, while one of their existing locations in North County is being threatened with eviction.
Its most recent location opened in March 2023 located in Rancho Bernardo and just a year later, The BXNG Club began soliciting additional investor funds to support its “strategic expansion” goals.
The BXNG Club appeared to begin falling behind financially at its Rancho Bernardo location had racked up $95,403.99 in unpaid rent as of June 26.
Jason Turner, an attorney for The BXNG Club, told FOX 5/KUSI in a phone call that the goal with the Chapter 11 bankruptcy is to “reorganize, restructure and come out of bankruptcy stronger than before,” preserving what the company has while “continuing to support its members.”
In a statement sent to FOX 5/KUSI after publication, founder and CEO Artem Sharoshkin had attributed their need to file for bankruptcy to “economic headwinds and pandemic consequences” that has affected businesses across all industries.
“Decreased membership base and rising utility costs, combined with the overall increased cost of operating in California, have put immense pressure on our organization,” Sharoshkin said.
Litigation attorney and bankruptcy expert Kent Sharp noted that it may likely not be until next spring when the creditors of the business and the courts approve a restructuring plan, which still have the potential to close branches if necessary.
According to court filings, an initial call between creditors and attorneys for The BXNG Club is scheduled at the end of this month on July 23, reports FOX 5/KUSI News.
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Also Read: Another Mall Clothing Retailer Now At High Risk of Bankruptcy
Other Economy News Today
A massive rental company with 34k locations now shuts down its operations after filing for bankruptcy and 22 years in business.
Users of movie rental company Redbox were left saddened after it was announced that it would be shutting down operations.
The announcement comes after the rental company’s parent company, Chicken Soup for the Soul Entertainment, filed for Chapter 11 bankruptcy.
According to court documents obtained by the Washington Post, the Connecticut-based company claimed to be one billion dollars in debt.
As a result, Redbox, which was a staple of many grocery stores including Walgreens, and CVS will be shuttered.
Many fans took to social media to express how upset they were with the loss.
“I knew it was coming, sadly,” UltraVada wrote in a post on X, formerly Twitter.
“It was inevitable,” a second person mourned.
“I knew this would happen when I heard they filed for Bankruptcy but its still sad to hear. I have a lot of fun memories of Redbox,” a third person lamented.
“I still don’t think this will be or ever be the end of physical media as we do still get remasters of some movies in 4k/Bluray.”
One person revealed that they had forgotten the rental service had existed.
Some users were not surprised by the announcement.
“Not surprised since nobody really rents videos anymore with the rise of streaming and what not,” one user admitted.
“Also kinda remember getting into a feud with them on here.”
One user also pointed out that the last remaining Blockbuster, located in Bend, Oregon, managed to outlive Redbox.
Redbox was acquired by Chicken Soup for the Soul Entertainment (CSSE) in 2022 and became one of the company’s flagship video-on-demand streaming services.
At its peak, CSSE operated more than 20,000 DVD rental kiosks across the country.
The company’s filing means that the company’s more than 1,000 employees will be laid off, per The Wall Street Journal.
It was also reported by Deadline that many employees at CSSE hadn’t received their paychecks and had medical benefits cut in late June.
Also Read: This Massive Mall Retailer Is Now Closing In California
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