Operations, july 5, 2013

     The new owners of the Cliffs Communities in the Carolinas don’t appear to be as committed to golf as the original owners were. These days, in fact, investors behind Silver Sun Partners are busy perking up their health and wellness centers as well as the menus at their restaurants. “We believe food is going to be the new golf,” says Davis Senza, the CEO of the Cliffs’ management group. The strategy may be resonating with prospects, because the Asheville Citizen-Times reports that the Cliffs’ membership rolls have grown from 1,970 to 2,700 in the year since the seven-property chain emerged from bankruptcy protection.

     A veritable who’s who of management companies is vying for the opportunity to manage the city of Tucson, Arizona’s five golf properties. The city has whittled 15 original applicants down to seven: Billy Casper Golf, CourseCo, Foresight Golf, KemperSports Management, Kitson & Partners, OB Sports Management (KVOA-TV identifies it as “the frontrunner”), and Southern California Golf. All seven have all promised to improve course conditions, customer service, and marketing. But larger questions remain. In particular, the city wants to know how the companies plan to pay for overdue capital improvements to the properties. And some of the city’s golfers want to know if they plan to close two courses, Fred Enke and El Rio, that have long been swimming in red ink. A winner will be named later this year.

     The city of Phoenix, Arizona, the owner of a half-dozen financially challenged golf properties, has endorsed a plan to seek private-sector management. Sometime this summer, according to the Arizona Republic, the city will request proposals for the operation of five courses. The sixth course, Papago Golf Course -- it’s the city’s premier golf property -- will be outsourced separately. Deep-pocketed bidders will likely get special consideration, seeing as how the courses need substantial capital improvements and city’s golf enterprise fund will soon be $17 million in the hole.

     A private club in suburban Denver, Colorado has hired Billy Casper Golf to lay the foundation for its future. BCG has pretty much assumed total control of The Golf Club at Ravenna, which features a Jay Morrish-designed that’s been cited for excellence several times since it opened in 2006. “Our mandate is to leave no stone unturned, so members feel a vibrant sense of activity and belonging,” said Peter Hill, BCG’s CEO, in a press release. BCG operates more than 140 U.S. golf facilities, but Ravenna is its only property in Colorado.

     Greenway Golf Management has begun tending to the turf at Grand Palms Hotel & Golf Resort in Pembroke Pines, Florida. Bidders for such contracts all provide essentially the same service -- “They fertilize, cut, and water,” the property’s general manager said in a press release -- but Greenway distinguished itself by providing something more: “A unique plan to take Grand Palms to the next level.” The plan involves an immediate regrassing of the 27-hole complex’s fairways, followed by improvements to tees and greens. Greenway is conducting similar programs at its other properties in Florida, Bonaventure Country Club in Weston and Davie Golf & Country Club in Fort Lauderdale.

     To understand the challenges posed by “the new normal,” consider the nature of the turnaround taking place at Valley Oaks Golf Course in Visalia, California. The good news is that CourseCo appears to have reversed a decline in the number of rounds played annually at the 27-hole municipal complex. The city believes Valley Oaks will attract more than 64,000 rounds this fiscal year, up from 62,500 in 2011-12, and CourseCo predicts increases of about 2 percent a year over the next five years. The trouble is, at such a rate of growth it’ll be more than a decade before the complex can again match the 77,100 rounds it rang up in 2007-08. Joni Mitchell was right: You don’t know what you’ve got ’til it’s gone.

     This summer, the state of Georgia will turn over five of its parks to private-sector management. Coral Hospitality has agreed to take control of the properties, two of which -- George T. Bagby State Park and Little Ocmulgee State Park -- include golf courses that haven’t shown a profit for at least five years. Coral has some experience in course management, as it’s operated tracks in two other Georgia state parks for the past decade.

     A nagging problem has resurfaced in Prescott, Arizona. Antelope Hills Golf Course, a 36-hole municipal complex, continues to operate at a deficit, and profits aren’t expected anytime soon. “We anticipate that at some time in the future it’s going to be contracted out,” a city official told the Prescott Daily Courier. “The only question is when, and whether it’s a part of something much larger.” The “something much larger” may involve closing nine of the complex’s holes and turning the complementary nine into an executive-length track.