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Review of Final Report
Hunden Strategic Partners
April 21, 2017
2
Key Questions
o What is the purpose of Collier County developing its own golf course?
o What are the costs and benefits?
o Are there alternatives that achieve similar goals?
o What are national recreational golf trends and how do they relate to the long-term
viability of a publicly owned golf course?
o What are demographic trends in Florida, specifically Collier County? How do they
impact recreational golf?
o What is the present condition of golf facilities and infrastructure throughout Collier
County?
o What are the costs/benefits in providing a publicly managed golf course
versus a privately managed golf course in Collier County?
Headlines
3
o The purpose of a publicly owned golf course is to provide quality golf at a seasonally
competitive, yet reasonable rate for residents –especially during the peak season
o The costs: capital development costs ($4 -$5 million), land purchase (TBD) and
ongoing operating costs ($0 -$300k+)
o Alternatives that achieve the same goal: discount coupons or similar county-
provided discounts at existing privately-owned courses.
o Result: enhances economy viability of existing courses for lower
investment.
o Challenge: golf demand currently so high that discounted rounds may not
solve the problem
Headlines
4
o National golf participation is steadily decreasing –has experienced 24% decline
between 2006 and 2015
o Target demographic for recreational golf are members of Baby Boomer Generation
and Generation X –households with annual incomes above $50,000
o High concentration of golf courses in Collier County -limited number of high quality,
affordable public access courses (semi-private resort courses)
o Higher likelihood of increased gross and net revenue with private, third party
management relative to public management due to incentive based structure
o Quality is important. Existing privately owned low quality courses charging less than
higher quality publicly owned course (in other counties –from survey)
5
•Collier County has a higher portion of households with incomes >$50K
•Collier County features lower ratio of citizens ages 35 to 64
•Lowest percentage among comparable counties in SW Florida –
does not account for seasonal visitors
Southwest Florida -Demographics
Southwest Florida Demographic Analysis
2015
Population
Estimate
Population
between 35-64
years old
Percentage Total
Households
Households with
income > $50K Percentage
Manatee County 363,369 165,927 46%143,725 66,966 47%
Polk County 650,092 232,196 36%221,381 96,928 44%
Pinellas County 949,827 494,247 52%402,653 186,779 46%
Lee County 701,982 248,573 35%252,287 122,753 49%
Average 666,318 285,236 42%255,012 118,357 46%
Collier County 357,305 122,462 34%129,888 74,296 57%
Source: American Community Survey, US Census Bureau
6
Collier County –Public
Golf Courses
•75 total courses
•14 public access
courses
7
•Public access resort courses drive average rates up in Collier County
•Inclusion of cart fee into rate also drives averages up
•Limited supply of high quality –public access courses in Collier County
•Average membership fee higher in Collier County vs. surveyed courses
•Cost per round averages $25 lower during low season and $56 lower
during high season on publicly-owned courses vs. privately owned
Survey Courses vs. Collier County Public Courses
Surveyed vs. Local Public Access Golf Courses - Rate Structure
Publicly Owned-Surveyed Golf Courses Privately Owned-Local Public Access Golf Courses Difference (Public less Private)
Membership Low Rate High Rate Membership Low Rate*High Rate*Membership Low Rate High Rate
Average $1,330 $22 $71 $4,681 $47 $126 ($3,351)($25)($56)
Low $720 $15 $24 $1,500 $25 $52 ($780)($10)($28)
High $2,199 $32 $225 $11,140 $90 $265 ($8,941)($58)($40)
Source: Collier County Municipal Golf Survey
*Cart Fee Included in ALL rates
8
Survey Results –Revenues / Expenses per 9 Holes
•Majority lose money
•Majority managed by the public sector
•Public golf courses are an amenity for local residents –quality of life
$1.1
$0.5 $0.5
$1.0
$0.7
$0.5
$0.8
$1.2
$0.5
$0.8 $0.9
$1.2
$0.5
$0.9
$0.0
$0.2
$0.4
$0.6
$0.8
$1.0
$1.2
$1.4
$1.6
$1.8
Ci ty of
Cape Coral
Ci ty of
Largo
Ci ty of
Lak el and
Ci ty of
Orlando
Ci ty of
Pompano
Beac h
Ci ty of Sarasota Mi ami Dade
CountyMillionsSurveyed M unicipal Golf Courses -2016 Reven ues & E xpenses per 9 Holes
Series1 Seri es2RevenueExpenseSource:Collie r Cou nty Mu n icip al Golf Surve y
9
Conclusions
o One-time and Ongoing Financial Commitment
o 140-180 acre site on average; land prices generally increasing as population increases
o Average development costs run between $2 and $3 million + land acquisition cost
o Capital expenditures (on top of operating loss) $75k -$150k/year
o Annual net operating loss more likely than profit; up to -$400,000.
o Provides affordable play for county residents.
o Number of beneficiaries relatively small compared to overall population
o Discounts or coupons at existing courses would provide similar benefit but not likely in
high season. Much more targeted and less expensive solution. Also benefits local
privately-owned courses, especially during off-season.
o Little additional economic, fiscal or employment benefit to consider in the ROI calculation
o Dozens of sports and rec programs that citizens (and tourists) use.
o There are many other multipurpose facilities that will generate impact and provide
opportunity for citizens (indoor & outdoor). Single purpose is tougher to support.
o County’s efforts to develop robust youth sports complex is an example.