Budget gym operator Pure Gym is to open its fifth UK site in Sheffield, after agreeing to a leasehold deal on a property at the city's Sheaf Gardens industrial estate.

The company has secured a former Dixons Car Showroom site and has started work to convert the space into a health club.

The Sheffield club will be the first of seven new sites that Pure Gym will open during 2010. It plans to have 20 gyms operating across the UK by the end of 2011.

The company has agreed terms for properties in Smethwick, Birmingham; Glasgow; and Southend on Sea while negotiations are at an advanced stage for further sites in Aberdeen, Belfast and Derby.

The expansion will be funded by a £6m loan facility provided by a consortium of investors led by Magenta Partners. Pure Gym has previously raised £3.5m from its management and private investors.

Peter Roberts, chief executive of Pure Gym, said: "Our existing sites in Manchester, Leeds, Edinburgh and Wolverhampton are trading well and have set the template for future developments.

"The new round of funding means that we are actively looking for further sites throughout the UK where there is access to strong population demographics".

All Pure Gyms will be open 24 hours a day, seven days a week and offer memberships from £12.99 a month.Roberts founded Luminar Leisure in 1989.