Hong Kong’s Physical gym chain has announced it will temporarily shut down all its operations after 38 years of business, but said talks between a new investor and landlords to reopen existing fitness centres are under way.

Physical Health Centre made the announcement on Friday after the Mandatory Provident Fund (MPF) Schemes Authority demanded the fitness chain settle about HK$3 million (US$384,615) in outstanding contributions for 740 employees. The pension regulator also warned it would take legal action if the chain failed to settle the payments.

“Although Hong Kong’s economic environment has gradually improved since the Covid-19 pandemic four years ago, some landlords of certain branches still maintained high rents,” the chain said in a statement.

It added that a new investor was closely negotiating with the landlords of various branches to continue renting spaces for the centres.

“Once a consensus is reached, the relevant branches will reopen immediately to provide services to everyone. Customers, please wait patiently,” the chain said.