How to Finance a City Sweats Franchise: Sauna Spa Costs
By Marc Cornella
A City Sweats franchise loan funds an infrared sauna and cold plunge spa, a wellness format that leans on specialized equipment, private treatment rooms and a membership base rather than a kitchen or a gym floor. For a buyer, the financing questions center on the build-out, the sauna and plunge package, and the working capital needed to carry the studio while memberships grow.
Below we cover what City Sweats publishes about its franchise program, which costs to confirm in the Franchise Disclosure Document (FDD), and how its SBA listing shapes financing.
US Professional Funding is not affiliated with, sponsored by or endorsed by City Sweats; the name is used only to describe the business. Figures from the franchisor’s disclosure document can change, loan programs and terms vary by lender and borrower, and every loan is subject to lender review and approval. Nothing here is legal, tax or investment advice; review the current FDD and franchise agreement with a qualified franchise attorney and accountant.
City Sweats Franchise Loan at a Glance
- Concept: an infrared sauna and cold plunge spa that pairs sauna sessions with contrast therapy, lymphatic drainage, red light therapy and body sculpting services.
- Background: founded by Dee Alams, with the first studio in Seattle’s Madison Park neighborhood; the company says it has offered wellness experiences since 2014.
- Footprint: company studios in the Greater Seattle area, including Wallingford, Bellevue and West Seattle.
- Revenue model: membership-based, according to the franchisor’s franchise page.
- Growth markets named by the franchisor: Lynnwood, Spokane and Tacoma in Washington, and Austin, San Antonio, Dallas and Houston in Texas.
- Fees and investment: not published on the franchisor’s website; they are provided through the FDD during the review process.
- SBA Franchise Directory: listed (code S8344) with no special directory notes.
What Is City Sweats?
City Sweats is a women-owned wellness company built around infrared sauna therapy. Founder Dee Alams opened the first location, dedicated to infrared therapy, in Madison Park, and the business has since grown into a small group of studios across the Greater Seattle area. The company describes itself as the original infrared sauna spa in its market.
The service menu goes well beyond a sauna room. Studios offer private infrared sauna cabins, cold plunge and contrast therapy, mineral showers, lymphatic drainage, red light therapy, body sculpting, facials and massage. Studios also feature a relaxation lounge, a tonic bar and a small boutique.
The franchise model. On its franchise page, City Sweats describes a membership-based revenue model, a turnkey brand infrastructure, a reserved market territory, equipment and studio planning, and an operating model it calls adaptable. Its support list includes onboarding and hands-on training, site selection and spa design direction, digital marketing, booking and point-of-sale systems, hiring templates and ongoing education.
How lenders see a sauna spa. Lenders generally like recurring membership revenue and a compact footprint. They are more cautious about a young franchise system and about specialized equipment that can be hard to resell, so the borrower, the site and conservative projections carry a lot of weight.
City Sweats Franchise Costs
City Sweats does not publish its franchise fee, royalty or investment range on its website. The franchise page says options, investments and resources are reviewed with candidates during the process. Request the current FDD and use it as the source for every number in your loan request.
Initial franchise fee. Item 5 of the FDD sets out the initial franchise fee, when it is due and whether any of it is refundable. Ask whether the franchisor offers pricing for more than one territory.
Lease and build-out. In a City Sweats franchise loan, the build-out is often the largest piece. Most sauna spas are built in leased retail or mixed-use space. Expect leasehold improvements for electrical capacity to run multiple saunas, plumbing and drainage for showers and cold plunge tubs, ventilation, private room partitions, a reception and retail area and spa-grade finishes.
Equipment. The core package typically includes infrared sauna cabins, cold plunge units with chillers and filtration, red light therapy devices, body sculpting equipment, treatment tables, laundry equipment, sound and video systems, and booking and point-of-sale technology.
Opening costs and working capital. Opening inventory for the tonic bar and boutique, linens, pre-opening payroll during training, grand opening marketing, deposits, insurance and an operating reserve round out the budget.
Total investment. Item 7 of the FDD shows the estimated initial investment and its line items. For a sauna and plunge studio, expect categories such as:
- Initial franchise fee
- Leasehold improvements and construction
- Infrared saunas, cold plunge and therapy equipment
- Furniture, fixtures, signage and decor
- Booking, point-of-sale and other technology
- Opening inventory and supplies
- Training expenses, deposits, licenses and professional fees
- Additional funds for the initial operating period
Present a budget whose line items add up to the Item 7 total, then add your own contingency. Our overview of fitness and wellness studio start-up financing explains how lenders size a new-studio loan.
Ongoing Fees and How They Affect Your Loan
Royalty, brand fund and technology fees. Item 6 of the FDD lists the royalty, any brand or marketing fund contribution, technology or software fees, training fees, transfer fees and renewal fees. Percentage-of-sales fees come off the top before rent, payroll and loan payments.
How lenders factor them in. A lender builds projections from membership counts, dues, service and retail sales, then subtracts royalty and fund contributions before measuring the cash flow left for debt service on a City Sweats franchise loan. Model every percentage-of-sales fee at your projected sales level.
Equipment replacement. Saunas, chillers and therapy devices wear out. Ask about required upgrades and build a replacement reserve into your plan.
Franchisor Requirements for New Owners
City Sweats does not publish minimum net worth or liquid capital requirements on its website. Check Item 7 and the franchisor’s application materials for any financial thresholds, and expect lenders to set their own requirements regardless.
The franchise page mentions a small team requirement. The franchisor’s process runs through six stages: connecting with the team, an introductory call, experiencing the spa, reviewing options and investment, meeting the leadership team and preparing to open with training. Use the review stage to obtain the FDD and ask about site approval and opening timelines.
Ways to Own a City Sweats
A new studio. Most buyers in a young system open a new location in a reserved territory. Lenders underwrite these deals on projections, the borrower’s strength and the site, and they expect a meaningful equity injection plus working capital.
Buying an existing studio. A resale lets lenders review actual membership numbers and financial statements, subject to franchisor approval of the transfer. See our guide to buying a boutique fitness studio.
Financing Options for a City Sweats Franchise
SBA 7(a) loans. Because City Sweats is on the SBA Franchise Directory, the SBA 7(a) loan program is often the first option buyers explore. A single 7(a) loan can cover the franchise fee, build-out, equipment and working capital.
SBA 504 loans. The 504 program targets owner-occupied real estate and long-lived fixed assets, so it usually fits only if an owner buys a building.
Conventional term loans. Experienced owners with strong collateral may prefer a conventional business loan, which can be faster to document but often asks for more equity and stronger financials.
Equipment financing. Infrared saunas, cold plunge tubs and chillers, red light panels and body sculpting devices can be financed or leased separately, which can preserve cash for the build-out. Learn more about fitness and wellness equipment financing.
Working capital and lines of credit. Memberships build gradually while rent, payroll and utilities start immediately. A working capital loan or line can bridge the early months. See our working capital options for fitness studios.
Seller financing on resales. A seller may carry part of a resale price. A seller note is typically subordinate to the senior loan, and loan programs may limit its terms.
SBA Loans for City Sweats Franchisees
The SBA Franchise Directory lists franchise brands whose agreements have been reviewed for SBA eligibility. Lenders generally require a brand to be on the directory before making an SBA-guaranteed loan to one of its franchisees.
City Sweats’ listing. City Sweats appears on the directory under code S8344 with no special notes. In plain English, the franchise relationship itself does not raise eligibility issues requiring extra lender steps. A listing does not approve any borrower; each loan is still underwritten on the buyer’s credit, experience, equity and projections.
Program size. The SBA 7(a) program maximum is currently $5 million, although program rules can change. A single sauna studio would typically need far less, but the ceiling matters to owners who plan several locations.
Application tips. For a City Sweats franchise loan, bring the FDD, a lease or letter of intent, build-out and equipment quotes, a personal financial statement and membership-based projections. Our article on SBA loans for gyms and studios covers the details, and the SBA loan calculator can help estimate payments for planning only.
How Lenders Evaluate a City Sweats Deal
Personal credit and financial history. Expect a review of credit, tax returns and a personal financial statement, plus a personal guarantee.
Net worth and liquidity. Lenders look for cash to cover the equity injection and a reserve after closing, especially for a newer brand.
Industry and management experience. Spa, wellness, fitness or hospitality management experience strengthens a request, as does a plan for hiring trained treatment staff.
Business plan and projections. Model membership growth month by month, dues, treatment and retail revenue, staffing and utilities, with a conservative ramp-up. Our article on how lenders view membership revenue explains what they look for.
The FDD and franchise agreement. Lenders review the term, renewal and transfer provisions, territory rights and fee structure. Item 19 tells you whether the FDD includes financial performance representations; whatever it shows, base your projections on your own market.
The site and lease. Parking, visibility and a health-conscious population support membership sales, and lenders want a lease term that covers the loan term.
For resales, historical financials. Expect to provide several years of profit and loss statements, membership reports and tax returns for the studio being acquired.
Equipment, Utilities and the Spa Build
A sauna and plunge studio is more equipment-intensive than its size suggests: infrared cabins need dedicated circuits, and plunge tubs need chillers, filtration and drainage. Confirm electrical service and plumbing before signing the lease, ask about tenant improvement allowances and get warranties for major equipment. Lenders like to see maintenance budgeted, because a sauna that is down means lost bookings.
Multi-Unit Growth and Development
City Sweats says it is seeking owners in several Washington and Texas markets. If you plan more than one studio, ask the franchisor about territory reservations and opening schedules and how they are documented.
Financing a second or third studio. Once a first studio has operating history, lenders can underwrite its cash flow alongside the new location’s projections. Owners often finance each studio separately. Our overview of multi-location studio financing explains how this typically works.
Real-World Scenarios
A wellness professional opening a first studio. A licensed esthetician with years of spa management experience opens a studio in a suburban market. She uses an SBA 7(a) loan for the build-out, franchise fee and working capital, and finances the sauna and plunge package separately.
Buying an existing studio. A buyer acquires an operating franchised studio with an established member base. The lender relies on actual financial statements, and the seller carries a small subordinated note.
A multi-unit owner adding territory. An owner with one profitable studio adds a second nearby. The lender reviews the combined cash flow and finances the new location with a term loan and an equipment lease.
Common Mistakes to Avoid
- Signing a lease before confirming electrical capacity and plumbing for saunas and plunge tubs
- Building projections on fast membership growth without a ramp-up period
- Treating royalty and fund contributions as small fixed costs instead of a percentage of sales
- Leaving out equipment maintenance and replacement reserves
- Underestimating staffing for treatments such as lymphatic drainage and facials
- Spending all available cash on the build-out and leaving no working capital
For more pitfalls, read the fitness center loan mistakes owners make most often.
Next Steps to Finance Your City Sweats Franchise
Step 1: Start the franchisor’s process. Submit the inquiry form and complete the introductory call.
Step 2: Obtain and review the FDD. Study Items 5, 6, 7, 10, 17 and 19 with a franchise attorney and accountant.
Step 3: Talk with a financing specialist. Learn how lenders will view your credit, liquidity and experience before you pick a site.
Step 4: Choose a site and get estimates. Confirm utilities, get build-out and equipment quotes, and negotiate a lease that fits the loan term.
Step 5: Build your business plan. Prepare membership-based projections with a realistic ramp-up and a working capital reserve.
Step 6: Apply and close. Submit your loan package, coordinate with the franchisor’s timeline and plan for opening.
City Sweats Franchise Loan FAQs
How much does a City Sweats franchise cost?
City Sweats does not publish its investment range on its website. The total estimated initial investment and its line items appear in Item 7 of the current FDD, which the franchisor provides during the review process.
What is the City Sweats franchise fee?
The franchise fee is not published on the company’s website. Item 5 of the FDD lists the initial franchise fee and its terms.
How much liquid capital or net worth do I need?
City Sweats does not publish minimum financial requirements on its website. Lenders will expect enough liquidity to cover your equity injection and a cash reserve after closing.
Is City Sweats eligible for SBA loans?
Yes. City Sweats is listed on the SBA Franchise Directory under code S8344 with no special notes, so SBA 7(a) financing is available to qualified buyers, subject to lender approval.
Can I finance the saunas and cold plunge equipment separately?
Yes. Infrared saunas, cold plunge units and therapy devices can often be financed or leased separately, which may reduce the cash needed at opening.
Can I buy an existing City Sweats studio?
If a franchised studio is for sale, it can be bought with franchisor approval. Lenders will review the studio’s financial statements and membership history.
Can a first-time business owner get a City Sweats franchise loan?
Yes, if the franchisor approves the candidate and the borrower qualifies. Wellness, spa or management experience and a strong hiring plan help.
Does City Sweats offer financing?
The company’s website does not describe franchisor financing. Item 10 of the FDD discloses any financing the franchisor offers.
How long is the franchise term?
The term and renewal rights are set out in Item 17 of the FDD and in the franchise agreement. Lenders prefer a term that runs at least as long as the loan.
Final Thoughts
A City Sweats studio combines membership revenue with a specialized build-out. Get the current FDD early, confirm your site’s utilities and approach lenders with conservative projections.
US Professional Funding helps franchise buyers finance start-ups, acquisitions, equipment and working capital. Learn more about our franchise financing solutions and fitness and wellness center financing.
