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Holiday Island Country Club Review of Operations Prepared for: - PowerPoint PPT Presentation

NGF Holiday Island Country Club Review of Operations Prepared for: Holiday Island Suburban Improvement District Presented by Richard Singer Director of Consulting Services National Golf Foundation Consulting, Inc. (561) 354-1642

  1. NGF Holiday Island Country Club Review of Operations Prepared for: Holiday Island Suburban Improvement District Presented by Richard Singer Director of Consulting Services National Golf Foundation Consulting, Inc. (561) 354-1642 NGF - KEEPING GOLF BUSINESSES AHEAD OF THE GAME SINCE 1936 1150 SOUTH U.S. HIGHWAY ONE, SUITE 401, JUPITER, FL 33477 PHONE: 561-744- 6006 ∙ FAX: 561 -744- 9085 ∙

  2. Holiday Island Country Club Introduction  National Golf Foundation • Municipal golf facility consulting • NGF Staff – Richard Singer • Not advocate for any position other than Holiday Island Suburban Improvement District success w/ Holiday Island CC  Why we’re here: • Review the operation, economic potential, physical condition of 18 hole Holiday Island CC, 9 hole Island golf course and clubhouse • Review the market environment • Provide recommendations and alternatives for maximizing the economic potential of golf within the District.  Methodology: • Meetings  Facility inspection • Market analysis  Site analysis 2

  3. Holiday Island Country Club Key Components of the Study  Physical condition of Holiday Island CC  Recent performance of Holiday Island CC  Status of Holiday Island area golf market  Identify how Holiday Island CC can maximize potential  Help HISID create a sustainable golf facility for long-term future success  Present NGF Consulting findings and recommendations 3

  4. Holiday Island Country Club General Impressions  Holiday Island CC has the basic design features and location to be a successful public golf course.  Aging infrastructure, especially related to turf conditions and irrigation.  Lack of adequate maintenance staffing, due to low revenue and low expense structure.  Remote location with small proximate population and limited local golfers support.  Inconsistent operating policies over time, leaving a perception in the region that HICC is a private, member-only club.  Declining golf market due to increased competition, reduced discretionary incomes, aging population, and changing demographics. 4

  5. Holiday Island Country Club – 18 Hole Course 5

  6. Holiday Island Country Club – 9 Hole Course 6

  7. Holiday Island Country Club – Physical Review Key Issues We See  Course is more than 40 years old, renovations/upgrades will be required in the near future (within 3 to 5 years) • Turf - some form of upgrade or replacement • Cart Paths - some upgrade and improvement • Irrigation - problems with breaks and coverage, not fully efficient • Greens - Bermuda contamination, some disease and nearby tree/root problems • Tees - should be improved with stronger turf and a leveling program • Bunkers - should be improved with better sand a linings • Driving Range - add a few tee stations, more length, and better targets • Maintenance compound would benefit from general “face - lift”. HICC should upgrade on- course “niceties”  • Course signs and markers inaccurate • Golf holes (cups) are raised too high • Yardage markers are not complete • Water stations need improvement 7

  8. Holiday Island Country Club Holiday Island Country Club Needed Physical Improvements Highest Highest Priority Items Estimated Cost Turf $150,000 Cart Paths 240,000 Amenities 60,000 Irrigation System 1,000,000 Greens 400,000 Sub-Total – Most Immediate $1,850,000 Lower Priority Items: Tees $30,000 Bunkers 70,000 Driving Range 60,000 Maintenance Area 15,000 Total Holiday Island CC Upgrades $2,025,000 8

  9. Holiday Island Country Club – Operational Review Key Issues We See  Operating policy has been inconsistent, switching between member-only and semi-private, or daily fee  Holiday Island CC is operating with a staff that is barely sufficient to sustain operations  HICC is being maintained to match budget, as opposed to golf course needs  The absence of a true “marketing plan” to define a strategy, establish goals and define specific activities  The total revenue earned at HICC is much lower than average for public golf courses of this type 9

  10. Holiday Island Country Club External Factors  Decline in overall demand for golf in this local market  Population growth in the area is at or below the total U.S. rate  Course supply in the area suggests a “saturated” market – small population and lower-than-average golf demand to support golf courses  Significant downward pressure on green fees in this market area. Very few northwest Arkansas area / southwest Missouri golf courses are able to charge in excess of $40 or $45 per round (w/cart). 10

  11. Holiday Island Country Club Key Operational Findings  Holiday Island golf system is basically set up in a traditional municipal golf format with full District control of facilities and labor.  No indication that the facility is being mismanaged in any way, but the golf course is under-staffed to provide a level of high quality maintenance.  HICC is operating a good quality golf course facility in a generally rural location with a limited customer base to support operations  Course is earning total revenue less than half the U.S. 18-hole golf “standard” of about $1.0 million in revenue  District has worked hard to reduce expenses in the operation to match the low revenue, but this has in part contributed to the reductions in maintenance and facility improvement  Staff includes a Class A-1 PGA Golf Professional, certified for the past 24 years, as well as, a GCSAA Class-A Superintendent with 36 years of golf maintenance experience. 11

  12. Holiday Island Country Club NGF Recommendations  Commit to a semi-private structure with renewed focus on attracting non-local golfers  Enhance marketing, especially related to technology (internet, email, social, etc.)  Improve the physical condition of the property with additional maintenance staff  Complete the physical upgrades needed, focusing on turf quality as highest priority  Implement player development activities that appeal to attracting new golfers  Make slight increase adjustment in playing fees bringing the Activity card average discount to around 20% from peak green fees, and commit to a program of annual fee adjustments to account for increasing maintenance costs. 12

  13. Holiday Island Country Club Preliminary Financial Analysis  NGF estimated 15,850 to 22,000 rounds in 2015-2018 period.  NGF projects facility revenue in the $450,000 to $700,000 range between 2015-2019.  The annual net income after all expenses is not likely to be positive, although direct golf losses can be reduced from over $200,000 projected for 2015, down to below $100,000 by 2017 and $65,000 in 2019  HICC operation, as it currently situated, is not sustainable for the long term, as it not likely to be capable of sustaining basic day-to-day expenses. It is also certain that the Holiday Island CC operation will not be able to cover any large-scale capital costs and it is likely that the facility will operate with continued losses 13

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