Sydney’s BeFit gym partner dispute leaves trail of destruction
High-profile sports star, former AFL star Josh Gibson, is one of a number of investors who have been impacted by a dispute between the former partners in up-market gym chain BeFit in Sydney’s Double Bay.
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A boutique gym venture involving a high-profile sports star and a string of investors across Sydney’s eastern suburbs has turned sour.
The director of BeFit in Double Bay is now trying to pick up the pieces after a dispute between him and his former business partner, Ben Ezekiel, over the state of the company’s finances.
Among the investors in BeFit, a chain of trendy gyms, which includes a centre in the exclusive Sydney suburb of Double Bay, was former AFL star Josh Gibson.
The former Hawthorn triple premiership player, who did not return calls last week, invested in Mr Ezekiel’s Sydney-based business BeFit Technology and according to business documents currently holds 125 shares.
In 2018, Mr Ezekiel established BeFit Technology, a spin-off from BeFit Training, which the Double Bay studio operated under with friend Stelio Fardoulis.
Mr Ezekiel’s involvement in the BeFit brand extended to Melbourne, where he was the director of a sister gym in Prahran. Mr Gibson took Mr Ezekiel’s place late last month.
Mr Gibson, who retired from AFL in 2017, is understood to be one of several investors who have questioned the return on his investment.
Mr Ezekiel, a 34-year-old from Rose Bay, has since resigned from BeFit in Double Bay and is now in a dispute over hundreds of thousands of dollars in outstanding bills.
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Vaucluse businessman Mr Fardoulis started the Double Bay gym with Mr Ezekiel, his best mate at the time, in 2016.
The 38-year-old bankrolled the passion project on New South Head Road and, as a result, he and his brother had a 60 per cent stake in the company.
“It was something I was passionate about and I put a lot of money in,” he said.
“Everyone used the place like their own personal playground and I was paying for everything.
“There were times it was good, there was a good vibe and good camaraderie. But then things went downhill.
“Turnover went down, it was employing more people than we could afford, I was constantly stressed and my marriage suffered a breakdown.”
Mr Fardoulis said he was initially in charge of running the finances but he relinquished that role while he was undergoing rehabilitation.
“I thought maybe this is a good thing and I don’t have to stress over the business and I can concentrate on getting better,” he said.
Emails between the directors, accountants and lawyers and obtained by The Sunday Telegraph detail the financial dispute that has become the talk of the Eastern Suburbs.
Mr Fardoulis and Mr Ezekiel are in dispute over documents lodged with the Australian Securities and Investments Commission (ASIC) in May 2019 to transfer shares out of Mr Fardoulis’ name and to remove him as the director.
Mr Fardoulis claimed he didn’t consent to the change.
In the months following, he received breach of lease notices because the rent for the Double Bay gym hadn’t been paid for four months and money was being transferred out of the business account and into an account for BeFit Technology.
Mr Fardoulis did not have a share in BeFit Technology.
In the months following his return to Sydney, Mr Fardoulis said the financial situation worsened as he received breach of lease notices for outstanding rent.
An email from the company’s accountant to Mr Ezekiel and Mr Fardoulis in February this year outlined the salaries paid by BeFit Double Bay to staff.
Mr Fardoulis replied that four out of six staff — including Mr Ezekiel’s wife — actually worked for BeFit Tech, which he has no stake in, and should have been on that payroll. Mr Fardoulis said he poured more money into the business to keep it afloat as the dispute over the business’s finances continued.
As the business relationship soured, Mr Ezekiel’s solicitor offered Mr Fardoulis $400,000 to buy him out of the business. The deal included a confidentiality clause covering the “allegations made against Ben … and the related dispute between the parties”.
Mr Fardoulis did not accept the offer and Mr Ezekiel resigned as director the following morning. After investing more than $500,000 into the gym, Mr Fardoulis, who runs an auto paint business in the western suburbs, said he had been left with more than $220,000 in outstanding bills.
Mr Fardoulis said the issues had affected at least 20 employees or investors, some of whom were clients, who dispute the return on their investment in the business.
The BeFit business will be restructured and moved under the banner of fitness chain Revl.
Mr Ezekiel’s lawyer did not reply to requests for comment on Saturday.