Pebble Beach: Raising rates????

[Greg Tallman]

How many rounds do they get?

40,000 rounds = $24,000,000 @ $600.
Would that include the cart?

What is their tax burden?
Any debt?
What could their maintenance budget be?
$2.5MM
Operations
$2.0M

I'll assume the F&B is profitable as is the merchandise...

Do they make $20MM a year?

Seems like it would be worth $200MM as a cash business.
I'll guess at least double that....

Try closer to 65,000 rounds. 2004 rounds were at 63,000 or so and they have since opened up the tee sheet later in the afternoon for non-guaranteed rounds... at the regular rate.

[rjsimper]

Like it or not, I think this comes as little surprise to anyone.

Like it or not, also, I am sure that I will pay the price to play there at some point in my life, be it next year or 30 years from now.  I can't just not play there.

I think that's the mentality they bank on, and like it or not, I see no way that would change so long as the tee sheets are full.

[Don Dinkmeyer]

If the $ to play 1 PB could get 2-4 new, other "best" courses, its an easy decision.

Not everyone has unlimited $ for golf  

[Jim_Kennedy]

There are many ways to gauge the worth of  a dollar, but using a CPI $1.00 in 1976 has the same buying power as $3.66 in 2007.
I’ve been looking for an old GD I have that lists some prices from1976. I thought PB was in it (it wasn’t), but I did find some others that might be interesting.
For instance:  
The Biltmore in Tampa – 4 days 3 nights for$140.00 pp in the high season. Included unlimited golf on 3 courses and 2 meals a day.
Skytop in the Poconos was $44.00 pp per day, any number of days, including golf and 3 meals per day.  
High Hampton Inn in Cashiers, NC was $183.00 pp for 7 days, 6 nights in the high season, including unlimited golf, tennis, all meals and tips.
Pinehurst Resort, NC was $106.00 pp for 4days/3nights, including unlimited golf( on one of their 5 courses), with one round on the #2 course. This was March thru May, and for $15.00 more pp per day you could add breakfast and dinner.
French Lick, Indiana had $39.95 pp per day including breakfast, lunch and dinner., March thru May.
The Wigwam in Az. Offered 7 days/6 nights for $269.50 pp,  or $299.50 Feb, thru April. It included breakfast and dinner, unlimited golf and airport transfers.
A two week trip to Scotland, including golf at TOC, Gleneagles,Turnberry, hotels, an over night in London, a car, airfare included was $698.00, departing in June.  
Courses owned by the City of New York Rec Dept., like Van Cortland, Split Rock, Dykers, Marine Park, etc., charged $3.00 weekdays, $5.00 weekends.  Los Angeles city owned courses  were $4.50 and $5.00.
An NGF survey showed that 18 hole muni fees averaged $4.46 to $5.59 across the country, with a ‘better’ daily fee costing $8.00
Some fees: Cog Hill $10.00, The Golf Club of Indiana $4.00, Jekyll Island golf courses $5.00, Jackson hole GC $9.50, Cranberry Valley $8.00.  
The purse at the TPC was 300k, Masters was 242k, the US Open was 236k. The women were averaging around 50k.
A set of Hogan Apexs’(2-pw) were $256.00, Wilson Staffs’ were $229.00(2-pw)
A Wilson, MacGregor, or Hogan driver was $36.00 to $47.00
Titleist balls were around $12.50 doz, bags were about $30/35.00

Using CPI, Cog hill should be $36.66,  4 days/3nights at Pinehurst w/one round on #2 should be $388.40, Hogan Apexs’ should be $932.02, and a dozen Titleists’ should be $45.80.

Some stuff followed the norm, other stuff went berserk.

[Richard Boult]

that's more than I paid for my entire set of clubs! bummer too that Bandon rates will likely climb to stay 50% those of Pebble's.  I'm liking my $21/round at Monarch Dunes more all the time!

[Tiger_Bernhardt]

I love the Lodge and the Monterey Pen/Pebble Beach world. However I stoped playing golf there not long after the current group started its corporate entertainment marketing strategy. Pebble was one of the great golf experience on earth at one time. However even now at its alltime low it is still very cool. I find places like Royal Dublin at $250.00 and Royal Troon at near $500.00 now to be very poor values. There are a lot of places in south Florida and the UK which are out of comtrol high relative to what you get golf experience wise.

[Dan King]

Cool. I'm going to not play Pebble this year, buy a 160g iPod and consider myself $350 ahead.

Cheers,
Dan King

My children - in many dimensions they're as poorly behaved as many other children, but at least on this dimension I've got my kids brainwashed: You don't use Google, and you don't use an iPod.
 --Steve Ballmer

[Scott Stambaugh]

It seems like that we have this discussion from time to time when PB raises their rates.

To me, it doesn't matter whether PB raises their rates $1 or $1,000.  The bottom line is what they charge is what the market will bear.  There's not a person on this site that is happy with it, unless you own stock in the company, but until the teesheets at Pebble start showing consistent openings on them, they are going to charge what they think they can get.

The one time I played it, it seemed like a lot of corporate golf was being played.  I would think that if I owned a large corporation and if I could smooze one of my multimillion $$ customers at Pebble Beach, $500 would be money well spent.

Is it right?  I'm sure that it's debatable, but being brought up in a capitalistic society, the laws of supply and demand are usually not wrong when you are talking about gasoline or greens fees.

This pretty much sums up it up.  Having the good fortune to live on the Peninsula for six years while I worked at MPCC, there was one thing that was consistent every time I stopped by Pebble whether it was to have lunch, go to the bank, browse the antique shop for books or on the rare occasion to play golf- there was always a foursome standing on the first tee.  Obviously, this hasn't changed.

$500 for five+ hours of entertainment is nothing compared to the $$$ the significant others are dropping at the Spa or in Carmel...

[Doug Siebert]

Well, I may never play PB now, that's just ridiculous.

However, I don't begrudge the owners their right to charge what the market will bear.  I think the fault lies with our tax code that allows 100% deductibility of entertainment expenses no manner how extreme (and obviously you can get a lot more extreme than a junket to PB, but you know what I mean)

I mean, if I spend $50 on dinner I can't deduct it all, but if I spend $40,000 to charter a jet to fly a dozen people to PB and spring for a weekend in the lodge and a couple rounds its fully deductible.  That's just stupid.  If it was only 50% deductible like meals I think the tee sheet would be less likely to be full at $700 a pop.

[Richard Choi]

We are just going to have to accept that golf in US is a sport for the elite.

As another poster has pointed out, the compensation for corporate executives have far outpaced the inflation rate. And the greens fee are following the executive rate rather than the normal inflation rate (at least for the top courses).

I also think BD will be close to or over $500 in next 5 to 7 years. So better get your rounds now than later.

[Bob_Huntley]

Scott,

Weren't you Bob Zoller's assistant on the Dunes course?

Am I right in saying the 14th hole only needed to be hosed off a couple of times due to winter storm surges?

Where are you now?


Bob

[Scott Stambaugh]

Scott,

Weren't you Bob Zoller's assistant on the Dunes course?

Am I right in saying the 14th hole only needed to be hosed off a couple of times due to winter storm surges?

Where are you now?
Bob-


Yes.  I was on the Shore and moved over to the Dunes to work with Rees and Co., still the highlight of my career so far.

You are correct about the location of #14 green- the offshore rocks protect it from the surf.  I witnessed several times water, rocks and driftwood on 17 Mile Drive, just to the south of the green, the green being untouched.  I know they have had a few occasions where salt water had to be hosed off.

After spending three years as the Supt at Marin Country Club, I had a great opportunity to move back to Seattle three years ago.  I am now the Supt at the Overlake Golf and Country Club just across the bridge from UW.

I still come down a few times a year,  perhaps we can meet someday.  Thanks.  I enjoy reading your posts.

Scott