[Geoffrey_Walsh]

For years I have been searching for a private club who had a good course and a viable business plan that would successfully attract members even in an environment where time and money are scarce.  Rye Golf Club (Rye, NY) came to my attention and I think they have the right model to survive.  You would think I would have been aware of the fact that the Town of Rye owns the club, considering I went to 12 years of grade school there but I just found out when a friend of mine recently moved near the course.



Rye is a 6300 yd, 1921 Emmet designed course bordering Long Island Sound.  The course resides in a very affluent area, just north of NYC and surrounded by great courses (Winged Foot, Quaker Ridge, Westchester, Fenway, and Apawamis to name a few).  However, this municipally owned PRIVATE club has no initiation fee, does not allow outside play without a member, and annual dues are less than $2000 by most estimates (we haven't nailed down a final number).  As recently as 2002 it was $1,220 (see link below, scroll down for dues table):

http://www.ryeny.gov/images/golfclub/appres.htm

Why haven't there been more of these municipally owned private course models created?  Most of the ones I have seen are like Reading Country Club (Reading, PA) where memberships are offered but it is still primarily a public golf course.  It seems like there is a need for affordable private options, and a municipal ownership model might be one way to create one.

Here is a recent review from earlier this year:

http://davedonelsonteetogreen.blogspot.com/2009/06/rye-golf-club-leaps-forward.html

[Mike Sweeney]

Westport, CT has Longshore which the town bought out of bankruptcy during one of these difficult economic time periods:

http://www.longshoregolf.com/

6000 or so yards of Orrin Smith. Pool for the kids. In my next life, my wife will allow us to move our family to Westport. With Yale as the Big Course and Longshore as the Little Course, life would be quite grand.   As of a year ago, out of towners can play Longshore as a walk up.

PS. Never played Rye. Looks a little congested and crowded when I drive by, but I could be wrong.

Never played it but a Doak for the property taxes may be a good deal at:

http://www.villageclub.org/fw/main/Home-1.html

[SB]

There's only a few municipal private clubs out there and most are in New York.  I think the reason you don't see more is that most municipal courses (particularly new ones) run at a deficit, meaning tax money is used to support them, and it's pretty tough politically to force taxpayers to support something they can't use.  But for that price in that area, it certainly can't be beat.  If I lived in Westchester, I'd move to Rye just to join.

[Geoffrey_Walsh]

SBusch,

I agree completely with your last point... a quality, affordable municipally-owned private golf club could be a wonderful incentive which differentiates one community from another.

[Phil McDade]

Geoffrey:

How do you reconcile the public ownership of the course with the private nature of its membership? I know of a couple here in Wisconsin that do it in some interesting ways.

[Tom_Doak]

Geoffrey:

A few years ago, we built a course with the same business model ... The Village Club of Sands Point, which is almost right across the Sound from Rye, on the north shore of Long Island.  The town bought out an old corporate retreat owned by IBM [the former Guggenheim estate], which had a nine-hole course, and expanded it to 18 holes. 

Because the town is small, they do allow non-residents to become annual members to the extent that residents don't fill it to the limit.  Those memberships are pretty easy to fill since there is no big initiation fee attached, but they have to live from year to year and aren't guaranteed to return.

Why aren't more of these developed?  Like any municipal project, there are always going to be a lot of objectors ... especially for an elitist GOLF COURSE.  Sands Point was able to deflect some of that because the estate offered lots of other amenities [tennis, beach club, swimming pool, manison for a clubhouse, etc.], but there were still town meetings with hundreds of questions.  And of course with any municipal project there was a LOT of red tape in building it which hindered the finished product a bit.

I suspect Rye was not set up as it operates today, but was a private club that was taken over by the city after the Depression (or later).  Now THAT is a model that has some potential moving forward.

[Jim_Kennedy]

Rye was taken over by the city in the mid '60s.

[Jim_Kennedy]

Geoffrey,
Rye did not take any money from NYS to buy the property, therefore the town has certain controls over the property that they would not  have if NYS was involved.

[Steve_ Shaffer]

How about these?

Palos Verde GC   www.pvgc.com

North Palm Beach CC  http://www.village-npb.org/index.asp?Type=B_BASIC&SEC={9AA5FF3D-F11F-4C89-BA5B-9B56D2C66B64}

[Geoffrey_Walsh]

Why aren't more of these developed?  Like any municipal project, there are always going to be a lot of objectors ... especially for an elitist GOLF COURSE.  Sands Point was able to deflect some of that because the estate offered lots of other amenities [tennis, beach club, swimming pool, manison for a clubhouse, etc.], but there were still town meetings with hundreds of questions.  And of course with any municipal project there was a LOT of red tape in building it which hindered the finished product a bit.

I suspect Rye was not set up as it operates today, but was a private club that was taken over by the city after the Depression (or later).  Now THAT is a model that has some potential moving forward.

Tom,

I have to believe that there are a number of older private clubs that are going to go under in the next 5-10 years.  My guess is most will considering selling to developers, but if the residential real estate market doesn't fully recover then a municipality stepping in to preserve the open space might become a more attractive option.

Just curious... how would a private model with annual dues less than $2000 (assuming full membership) compare to a daily fee public course when comparing potential profits?  I would assume that's what would really drive the decision making process for most municipalities.  What are the advantages/disadvantages of one versus the other?

Finally, I have to believe the quality of the course would have a great impact on potential membership interest but maybe I'm wrong.  As I think about it, if the price point was low enough, I think I might consider joining a local public course which is near me even though I am not a big fan of the design.

[Geoffrey_Walsh]

I'm sure I am way off, but I took a conservative guess at the math for a Pennsylvania course:

Daily-fee:
12 hours of tee times
8 tee times/hour
4 players each tee time
$50 per player
300 playing days / year

12*8*4*50*300= $5,760,000

To get a similar number from a private course:

$5,760,000 / $1800 dues = 3200 members

It seems like the daily fee is a no brainer.  What am I missing here?

[Jim_Kennedy]

Geoffrey,
There are less hours for tee times
They are not always full
They are not always foursomes
There aren't 300 days per season, really only 90/100 or so peak
You get paid when it rains w/a private course

[Phil McDade]

Just curious... how would a private model with annual dues less than $2000 (assuming full membership) compare to a daily fee public course when comparing potential profits?  I would assume that's what would really drive the decision making process for most municipalities.  What are the advantages/disadvantages of one versus the other?

Geoffery:

Maybe where you live. Here in Wisconsin, what would really drive the decision-making process is the nature of public access to a course owned by a municipality.

I also think your math on the PA course is way off -- 8 tee times for foursomes every hour is a foursome going off every 7-1/2 minutes, which would inevitably lead to mostly 5-hour rounds. Shepherd's Crook, in Zion IL just across the Wisconsin border, is a highly regarded muni that I'm told slots tee times every 10 minutes, which (if followed) cuts your revenue by 25 percent off the top.

[Geoffrey_Walsh]

As I expected, I was WAY OFF on my first guess.

I was able to track down the 2007 rounds/revenue numbers for Makefield Highlands (Yardley, PA) a good candidate for this public/private analysis:

2007 Rounds / Revenue
Jan - 486 rounds, $21,000
Feb - 14 rounds, $3,000
Mar - 982 rounds, $64,000
Apr - 2,973 rounds, $217,000
May - 5,680 rounds, $423,000
June - 5,738 rounds, $476,000
July - 6,359 rounds, $466,000
Aug - 5,793 rounds, $417,000
Sep - 4,950 rounds, $378,000
Oct - 3,700 rounds, $272,000
Nov - 2,500 rounds, $130,000
Dec - 747 rounds, $43,000
Totals - 39,922 rounds, $2,950,000

Given those totals, it would take a little over 1600 members at $1800 dues to cover that revenue.  If you added in a food/beverage minimum of $75/month, that would effectively add $900 to the dues and would drop the necessary member total to around 1000 members.  Of course that doesn't factor in any revenue from outings, events and merchandise which would drop the number even further.  Are cart fees assessed at most private clubs?

I would think if you could get the membership number necessary to replicate a daily-fee revenue stream down to 500-600 members it begins to look attractive.

[Steve_ Shaffer]

Private clubs do charge for carts. Fees range the teens to almost $30. Some clubs offer 4bagger carts for under $15each. I'd bet that MH will show lower numbers for 2008 & @009 because of the economy and weather this year. My understanding is that play is down at least 10% this year because of the rainy weather.
Do those numbers include F&B?

I see from the MH  website that they offer a Golf Ass'n to play in events but no annual membership is currently offered. If one were offered, how many would join?

Lederach offers annual plans. Prices are not published:

http://www.lederachgolfclub.com/passes/annual-pass/

I think the problem is that most public players prefer to play more than one course. Given the economy, one can join a local private club with dues under $3000.00 and a modest deposit/

[Geoffrey_Walsh]

Private clubs do charge for carts. Fees range the teens to almost $30. Some clubs offer 4bagger carts for under $15each. I'd bet that MH will show lower numbers for 2008 & @009 because of the economy and weather this year. My understanding is that play is down at least 10% this year because of the rainy weather.
Do those numbers include F&B?

I see from the MH  website that they offer a Golf Ass'n to play in events but no annual membership is currently offered. If one were offered, how many would join?

Lederach offers annual plans. Prices are not published:

http://www.lederachgolfclub.com/passes/annual-pass/

I think the problem is that most public players prefer to play more than one course. Given the economy, one can join a local private club with dues under $3000.00 and a modest deposit.

Steve,

The revenue numbers certainly will be down versus 2007 (my guess is much more than 10%) but let's use those figures as high-end numbers for a public course.  It is my understanding those #'s include everything (golf, cart fees, practices areas and F&B).  The average revenue per round over the year is over $70, so that feels right to me (most green fees are $25-$45).

Steve, I don't think many join an annual membership at a public course because it never makes sense on a per round basis (unless you are someone that can play often such as a retiree) and it is exactly the same experience as a paying as you go.  Call me crazy, but I would rather pay $1800 to join totally private club where everyone has invested on an annual basis than a "semi-private" structure where I am competing for tee times against someone who is coming to the course to play once but doesn't have a vested interest in its success/survival.  I also think a private structure lends itself to more of a community because most members will live in the immediate area.  If MH offered an annual membership, but still remained open to the public, I think very few would join unless it was below $1000.

There are a number of problems with joining a private club in the area.  Most have deposits north of $4,000 although some are significantly cheaper than in the past.  Most people my age (mid 30's) have no idea how the membership process works and therefore never even bother to look into it because of the uncertainty of what will be involved.  Finally, most clubs have annual dues well above $2,000 when everything is added in.  I think a municipal private model removes a number of these concerns because you know going in that anyone is welcome to join and the cost can be a fraction of the competition.  If you could keep the total cost under $2,000, I think you would finally have younger members coming out of the woodwork in this area.

[Geoffrey_Walsh]

Steve,

Here is an example of the other private clubs in the area:

Yardley CC - Regarded by most as a very affordable club in the area (and GAP), they have a promotional dues rate of $500/month and you eventually have to pay $3,600 deposit and buy two shares of stock for $2,850.  That brings the total to $6,000/year in dues and $6,450 in initiation costs.  You can carry your own bag without a caddy, so that limits additional charges.

Trenton CC - $5,000 deposit (way down from when I looked into it a few years ago), dues north of Yardley CC.

Spring Mill CC - $12,500 deposit and $5,200/year in dues according to their website.

Jericho National - I had heard they weren't charging a deposit right now, but normally the deposit was $20,000+, not sure on dues but I would be shocked if they were less than Yardley.

The higher-end options like Lookaway would be far above those figures.

[Jim_Kennedy]

Geoffrey,
I think you got some math wrong, or they did. The stated green fees on their site don't jive with any of the numbers you posted.

[Geoffrey_Walsh]

Jim,

I believe MH has raised their rates since 2007.  From what I remember, resident rates ranged from $20-$40 and non-resident rates were $30-$50, with less expensive twilight/9 hole/early bird rates.  If anyone remebers differently, feel free to chime in.

The 2007 revenue numbers were on page 10 of the link below:

http://www.lmt.org/finance/lmt_finance_report_08_final.pdf

[Geoffrey_Walsh]

Here is an itemized breakdown I found as well.  I have'nt reconcilied the two yet:

http://www.lmt.org/finance/Golf%20Budget.pdf

[Tags:]

Tags:

[Tags:]

Tags:

Call to undefined function theme_linktree()