Peter:
What overhead?
I'm of the view that it may be easier to make a 100-day season golf course work than a year-round or nearly year-round one work. Similar to swimming pools.
Phil,
Well perhaps it's just the SoCal in me speaking but it freaks me out to think of 100 days of business and then you close it down. What does the staff do in the winter? The GM? Is there a club pro? The maintenance crew? Mortgage and other loan payments? Insurance, utilities, security, etc, etc.
I guess it's just foreign to me to look at an asset that can't perform for 2/3 of the year. I'm sure I'm just being shortsighted.
Peter:
This will go off-track, but nonetheless...
I brought up swimming pools because I know a bit about how they're run. Here in the four-seasons Upper Midwest, you find a lot of communities with outdoor swimming pools that sit empty for nine months (post-Labor Day through Memorial Day), sometimes leading people to question why one builds outdoor pools. But properly run and maintained, outdoor pools can break even or even turn a profit (or generate extra dollars for the muni's that often run them). 3-month staffing costs, maintenance budgets, others -- it's pretty neat and tidy and predictable. Indoor pools, meanwhile, are notorious money-sucking things -- they rarely break even, and most are subsidized in some significant way. They're typically open early in the morning until late in the evening, to accommodate working families, and cost a ton to operate, because you have to heat both the pool water and the building that houses them.
It's a convoluted way of making the argument that --with the economic downturn threatening a number of courses -- maybe there is a model out there for golfing that suggests truncated seasons and thus reduced costs like maintenance, labor, overhead and the like. Of course, that's much easier to do in the Midwest than Yorba Linda, where it's always sunny. Midwest golf maintenance costs are helped by snow cover! Still, maybe there is a model that suggests Apache Stronghold or its ilk would be better served by a high-standard golf experience for only six months a year, with minimal maintenance and related costs the other half of the year. Just a thought -- I'm sure there are issues here I haven't thought of
