Item 5.3 • Item # 5.3.
City of
Elk
River
MEMORANDUM
TO: Planning Commission
FROM: Scott Harlicker, Senior Planner /l
DATE: May 28, 2002
SUBJECT: Case No. CU 02-20
Request by Charlotte/Sherri Gatewood for a Conditional Use
Permit to open a fitness facility
Request
• Consider a request by Charlotte/Sherri Gatewood for a fitness facility (It Figures) in Elk
Park Center.
Zoning/Land Use
PUD (Planned Unit Development / HB (Highway Business)
Location
19211 Freeport Street, Lot 2, Block 2, Elk Park Center
Attachments
Location map
Site plan
Floor plan
Letter from applicant
Overview
The applicant is proposing to open up a fitness facility called "It Figures" in Elk Park
Center. The applicant will be occupying about 3,600 square feet of space just south of
Target.The fitness facility is considered commercial recreation.The Elk Park Center PUD
• Agreement allows commercial recreation as a conditional use.
• The facility will offer various types of aerobic exercise classes during the day and evening.
The facility will be open from 6:30 a.m.to 7:30p.m.Monday through Friday and 6:30 a.m.to
noon on Saturday. The applicants goal is to sign up 720 members in the first year.
There is sufficient parking available to accommodate this use.No exterior alterations are
proposed. A wall sign will be allowed per the Elk Park Center PUD Agreement and will
require a sign permit from the city.
Recommendation
Staff recommends that the Planning Commission recommend approval of this request for a
fitness facility in Elk Park Center.
•
•
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River Case Number: CU 02-20 Charlotte/Sherri Gatewood
NO. TENANT SQ.FT. n/
A109A SALINA SALON & SPA 4,764 �rT1G.�
A109B CARIBOU COFFEE 1,485
A117 OFFICE MAX 23,437
• A119 PET FOOD OUTLET 5,694
A123 PAPER WAREHOUSE 8,346
A125 CUB FOODS 60,066 Z 4
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8101 MAGGIE'S HALLMARK 7,537 �I
B103A THE MEN'S COMPANY 1,975 U
81036 MAURICE'S 3,034
B105 RADIO SHACK 2,068
8107 FAMOUS FOOTWEAR 5,725 FL4 W
J q C B111 GREAT CLIPS 1,406
\0\1> K S O 8113 SUBWAY 1,406
(, s, N RB115 CHIN YUEN RESTAURANT 1,406
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T 8119 SALLY BEAUTY SUPPLY 1,406
O 13121 TARGET (STORAGE) 7,834
B122 TARGET (NOT OWNED) 89,065
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C101 FASHION BUG 8,453
66' TARGETr--- C101A GROWING UP KIDS 3,600
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2,009 EW3+ 1 I III B li- _ .0T OWNED E109 RB'S COMPUTER 1,691
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110 �� -•W 1.111 GENERAL NUTRITION 1,500
1.107 - -� I I I i I i I r-J E113 H & R BLOCK 1,000
1.1109 em I. - - - 5, SPY,.. E115 FIRESIDE COFFEE 2,000
1•691 ,s°°a , - -=---------- E121 HIRSHFIELD'S 3,508
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ELK PARK CENTER
NORTH ERITAGE PROPERTY
f mil MAY 2001 _ INVESTMENT TRUST, INC. -
ELK RIVER,MINNESOTA 0 240 480 1 . 8 0 0 . 9 8 3 . 2 0 2 0
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• IT FIGURES
2002 BUSINESS PLAN
Charlotte Gatewood and Sherri Gatewood
Co-Owners
EXECUTIVE SUMMARY
The purpose of this plan is to provide common focus and direction for the co-owners to begin a business
venture as It Figures,a women only fitness center(with possibly two future tanning booths)for members
only to be located in Space C101A at Elk Park Center in Elk River,Minnesota. Elk Park Center is a
community shopping center located on the west side of Highway 169 at Jackson Road approximately 2
miles north of the Highway 169/Highway 10 interchange.
The local industry conditions are one health gym and one women-only(Curves)fitness center, in the
population base of 17,016. The population base It Figures is marketing is women 35 to 65 years of age.
Co-owners Sherri and Charlotte Gatewood,do not have specific experience in fitness other than each has
been prior member of a women-only fitness center. Sherri has prior experience working with the public
while employed with a medical facility and as an office manager in a local business. Charlotte has been
employed with a manufacturer of durable goods and is currently an executive member of the business-
planning group and as Director of Human Resources whose annual gross sales are in excess of$50 million
annually. Each of the co-owners is determined to achieve success in this business venture.
The initial start-up financial needs have been supplied from personally from the co-owners. This has given
San opportunity to secure the city of Elk River,the initial order for equipment,office equipment and
business software,the first and last payments for the lease of the space in Elk Park Center,working capital,
and the financial needs for the improvements of the lease property.
MARKET AND ECONOMY
It Figures is the perfect business to begin. Health and fitness is a 33 billion-dollar industry. Why is It
Figures so opportune: low capital requirements; low business investment including equipment of$19,500;
Operational simplicity;minimum staffing requirements of one full time and 2 part time employees during
the initial start-up phase;no seasonality;health,fitness and beauty related investments are consumer
decisions usually unaffected by economic trends;direct response marketing,local print advertising creates
a high quantity of direct response inquirers. Gross sales often exceed expenses within the first 60 days of
operation. After the third month it will produce a profit
LOCATION
It Figures facilities cater to a niche market. We attract a certain type of consumer by combining a women
only thirty-minute fitness center with built-in personal attention. By locating this business in a community
shopping center,we will be visible to that market niche.
DAILY OPERATIONS
It Figures is planning on opening for business by August,2002. The minimum operating hours will be
Monday through Friday 6:30 a.m.—7:30 p.m.and on Saturday 6:30 a.m.—noon. As the business and
memberships increase the hours of operation will be evaluated and adjusted to the needs of the members.
• INCOME DETAILS
The source of revenue to It Figures will be generated by two types of fees. The first is a service fee that
will average$60 per membership. The initial fee is$149.00,however to gain memberships advertised
• specials will occur periodically. The second fee is a monthly dues based upon the length of membership
chosen by the patron. Thirty-five dollars per month is the average monthly dues and are set-up on an
automatic payment system.
The first month an estimated enrollment of 100+members is anticipated. Over the first 12 months of
business the goal is to have a minimum of 600 members however the goal is to sign up 720 members in the
first year.
EXPENSE DETAIL/SELLING
Salaries and wages are based on paying one full time employee and two part time employees. The full
time person will receive$10.00 per hour and each part time employee will be paid$6.00 per hour.
Advertising will be done primarily in the local newspaper throughout the year, as it gives the best direct
response. Direct mail is a source of advertising that will be used initially and if a boost from the newspaper
advertising is needed.
ADMINISTRATIVE
Drafting services include a banking software program that costs$120 to purchase and an ongoing fee for
transfers and reports of$50 per month,which includes any bank fees. All members will have their
Monthly Dues electronically drafted each month from their bank account.
Payroll and Payroll taxes will vary from month to month depending on the hours worked each month.
Office supplies,computer and software will be purchased as needed.
III Liability insurance will be purchased yearly from an industry specific provider along with a monthly
hazard insurance program to cover all insurance needs.
Other expenses will include postage, furnishings,special promotions contributions etc. and will vary from
month to month.
SERVICE AND EQUIPMENT
Initial start-up business package is$19,500 for the basic set up and includes all the equipment and initial
raining.
Average utility deposits are approximately$800.00.
Telephone connection and service will a little high to accommodate e-mail access.
Additional equipment costs have been added after approximately 6 months in order to increase the size of
the work out area to accommodate the increase in the number of members anticipated.
Monthly lease cost will be approximately 0,000 and will also include maintenance,taxes etc.
Leasehold improvements are part of the lease agreement. There is an option for up to$20,000 in
improvements to the property. This will be paid by the lease company.
Signage will be purchased after 6 months and the estimated cost will be$3500.00.