| CBI Interview | Ed Williams
Having weathered the recession in good shape, the president and CEO of Wellbridge is betting on the future with two new clubs and more to come
By Jean Suffin
CBI: First a little background: You’re a true industry veteran, having started out as a tennis pro in 1971, and, since then, having done just about everything that can be done. In 1983, just 12 years later, you cofounded Club Sports International (CSI), the company that’s now Wellbridge. What was your vision then?
ED WILLIAMS: CSI was founded as a third-party management company. We’d been examining the hotel and hospitality industry, looking for ideas and inspiration, and we noticed that something was missing. At the time, there was only one company, Club Corp of America (now ClubCorp), that was doing athletic-club management. We saw a need for club management. During the ’80s and early ’90s, the development business was in full swing, and every builder was pairing an athletic club with their develop- ment, so we started CSI, and, basically, followed developers around the country, creating 10,000-80,000-square-foot developer-driven clubs. It worked very well for us.
CBI: But then, the company transitioned to a different business model. Why was that?
EW: The advent of the real estate investment trust (REIT) changed things. Developers were selling their properties to REITs, and we found ourselves forced to deal with property managers rather than the actual developers. That changed our focus. We wound up spending our time and energy on petty details, such as discussing the cost of toilet paper, instead of the big picture—designing facilities to meet the needs of people looking for places where they could enjoy a sense of community and forge a healthy lifestyle. That was the part we loved. So we decided we had to get into an ownership position—to own clubs.
CBI: That led you, eventually, to two private-equity firms, Chilmark Partners and the Starwood Capital Group.
EW: Yes. Our partnership with Chilmark happened rather serendipitously. It was March of 1997, and, at the time, both of us—Chilmark and CSI—had an interest in purchasing the Northwest Athletic Clubs (NAC) chain. CSI, quite frankly, didn’t have the money. Chilmark did. So, along with Starwood, which shared Chilmark’s vision of capitalizing on emerging opportunities in the fitness and wellness market, the two groups provided CSI, a highly successful entrepreneurial company, with valuable investor oversight and new capital to fuel our growth plans, allowing us to acquire NAC. It seemed to be a good fit.
CBI: But, in 2006, you and your partner, Jay Kell, the current COO of the company, conducted a successful management buyout of what is now Wellbridge. What was that process like?
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Highlights » Moving to ownership » Two Denver debuts » Right-sizing a chain » The wellness mission
Ed Williams, the president and CEO of Wellbridge, a Den- ver-based chain that owns and operates 17 upscale properties and manages two others in 10 states, entered the industry in 1971 as a tennis pro. In 1983, he cofounded Club Sports International (CSI), a club- management company that, subsequently, became Well- bridge. The firm has since been involved in the development of more than 1.5 million square feet of club facilities, ranging in size from 10,000-square-foot corporate fitness centers to 200,000-square-foot mega- clubs. In 1997, Wellbridge aligned with two private-equity firms, Chilmark Partners and Starwood Capital Group, to purchase the Northwest Athletic Clubs (NAC) chain, which transformed it into a club operator. In 2006, Williams and Wellbridge COO Jay Kell conducted a success- ful management buyout of the company. Today, they, along with the Central Sports Company, Ltd., a publicly held Japanese club chain, are principals in Fitness Ventures LLC, the corporate parent of Wellbridge. —|
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ihrsa.org | OCTOBER 2010 | Club Business Internat ional 31
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