Resolution 2018-30573RESOLUTION NO. 2018-30573
A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE
CITY MANAGER, PURSUANT TO REQUEST FOR PROPOSALS (RFP) NO.
2018 -186 -WG, FOR GOLF COURSE OPERATION AND MANAGEMENT
SERVICES; AUTHORIZING THE ADMINISTRATION TO NEGOTIATE A
CONTRACT WITH PROFESSIONAL COURSE MANAGEMENT II, LTD; AND,
SHOULD THE ADMINISTRATION BE UNABLE TO SUCCESSFULLY
NEGOTIATE A CONTRACT WITH PROFESSIONAL COURSE MANAGEMENT
II, LTD, AUTHORIZING THE ADMINISTRATION TO NEGOTIATE A
CONTRACT WITH HAMPTON GOLF, INC; AND, FURTHER, AUTHORIZING
THE MAYOR AND CITY CLERK TO EXECUTE A CONTRACT UPON
CONCLUSION OF SUCCESSFUL NEGOTIATIONS BY THE
ADMINISTRATION.
WHEREAS, on May 16, 2018, the Mayor and City Commission approved issuance of
RFP No. 2018 -186 -WG for Golf Course Operation and Management Services (the RFP), which
sought proposals for the exclusive right to operate, manage, maintain, and promote the Miami
Beach Golf Club Course and Normandy Shores Golf Club and related facilities including,
without limitation, the pro shop, clubhouse, and food and beverage operations and facilities in a
manner consistent with the City's policies and procedures; and
WHEREAS, RFP responses were due and received on August 3, 2018: and
WHEREAS, the City received proposals from the following two (2) firms: Hampton Golf,
Inc., and the City's current golf courses manager, Professional Course Management II, LTD
(PCM); and
WHEREAS, an Evaluation Committee, appointed by the City Manager pursuant to LTC#
433-2018, convened on August 22, 2018 to consider the proposals received; and
WHEREAS, the Committee was provided an overview of the project, information relative
to the City's Cone of Silence Ordinance and the Government Sunshine Law; and
WHEREAS, the Committee was also provided with general information on the scope of
services and a copy of each proposal; and
WHEREAS, the evaluation process resulted in the ranking of proposers as follows:
Hampton Golf, Inc., as the top-ranked proposer, and PCM, as the second ranked proposer; and
WHEREAS, having considered the Evaluation Committee's rankings, the City Manager
conducted his own due diligence and review of the proposals and found PCM, to be the best
qualified firm for the management and operation of the Miami Beach Golf Club Course and
Normandy Shore Golf Club Course; and
WHEREAS, the City Manager's recommendation, as set forth in the City Commission
Memorandum accompanying this item (which is incorporated by reference hereto), noted that
while overall cost was important, selecting an operator that maintains the high standards and
level of service currently provided to patrons of the golf clubs was of the highest priority; and
WHEREAS, in this respect, and as further supported in the City Commission
Memorandum, the City Manager recommends PCM as the recommended proposer, given its
continued qualitative success in managing the City's golf courses.
NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City
Commission hereby accept the recommendation of the City Manager, pursuant to Request for
Proposals No 2018 -186 -WG, for Golf Course Operation Services; authorize the Administration
to enter into negotiations with the current manager and recommended proposer, Professional
Course Management II, LTD., and if unsuccessful in negotiating a new agreement with
Professional Course Management II, LTD; authorize the Administration to enter into
negotiations with Hampton Golf, Inc.; and further authorize the Mayor and City Clerk to execute
an agreement upon conclusion of successful negotiations by the Administration.
PASSED AND ADOPTED this /7 day of &G/okr 2018.
ATTEST:
I C /3QJ)Y
Rafael E. anado, City Clerk
INOOPP ORATED
Dan Gelber, Mayor
VEDASTO
LANGUAGE
EXECUTION
T \AGENDAt201 a\09 SeptemberProwrement\RFP 2018.186 -WG Golf Course Operation and Management 6ervires\RFP 2018n86AWG Reso doc
MIAMI BEACH
Resolutions - R7 R
COMMISSION MEMORANDUM
TO: Honorable Mayor and Members of the City Commission
FROM: Jimmy L. Morales, City Manager
DATE: October 17, 2018
SUBJECT: A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF
MIAMI BEACH, FLORIDA, ACCEPTING THE RECOMMENDATION OF THE CITY
MANAGER, PURSUANT TO REQUEST FOR PROPOSALS (RFP) NO. 2018 -186 -
WG, FOR GOLF COURSE OPERATION AND MANAGEMENT SERVICES;
AUTHORIZING THE ADMINISTRATION TO NEGOTIATE A CONTRACT WITH
PROFESSIONAL COURSE MANAGEMENT II, LTD; AND, SHOULD THE
ADMINISTRATION BE UNABLE TO SUCCESSFULLY NEGOTIATE A CONTRACT
WITH PROFESSIONAL COURSE MANAGEMENT II, LTD, AUTHORIZING THE
ADMINISTRATION TO NEGOTIATE A CONTRACT WITH HAMPTON GOLF, INC.;
AND, FURTHER, AUTHORIZING THE MAYOR AND CITY CLERK TO EXECUTE A
CONTRACT UPON CONCLUSION OF SUCCESSFUL NEGOTIATIONS BY THE
ADMINISTRATION.
RECOMMENDATION
Adopt the Resolution.
ANALYSIS
On September 10, 2003 the City of Miami Beach Mayor and City Commission authorized the
execution of a management agreement with Professional Course Management(Manager) for the
Miami Beach Golf Club, with a term of three (3) years, effective October 1, 2003, and expiring on
September 30, 2006, with two (2) one year renewal terns.
On September 5, 2007, the Mayor and City Commission agreed to waive the competitive bidding
process, finding such waiver to be in the best interest of the City, and approved a new management
agreement with Manger which commenced on October 1, 2007, and expired September 30, 2012.
At its July 10, 2012 meeting, the Finance and Citywide Projects Committee discussed the
management of the City's golf courses with the members; discussion focusing on the success that
Manager had operating the golf courses since the initiation of the first full-service management
agreement was implemented in 2003.
At the conclusion of the discussion the Committee recommended that Manager's Agreement be
extended on a month to month basis; that the Administration meet with Manager to negotiate terms of
a new agreement; that City staff provide more detailed information on the cost of other golf course
management companies and how the golf courses are maintained; and that the results of negotiations
and staffs report be brought back to the Committee for further direction.
Page 1241 of 1637
On April 17, 2013, the City Commission adopted Resolution No 2013-28186, accepting the
recommendation of the Finance and Citywide Projects Committee (made at its December 20, 2012
meeting) to waive the competitive bidding process for a new management agreement for the
management and operation of the City' Golf Courses, finding such waiver to be in the best interest of
the City, and authorized the City Manager to finalize and execute a new management agreement with
Manager.
The initial term of the agreement was for a period of three (3) years, with City option to extend the
agreement for two successive one (1) year terms, commencing October 1, 2013, and expiring on
September 30, 2018.
On May 16, 2018 the Mayor and City Commission approved issuance of RFP 2018 -186 -WG for Golf
Course Operation and Management Services, which sought proposals for the exclusive right to
operate, manage, maintain, and promote the Miami Beach Golf Club and Normandy Shores Golf
Course and related facilities including, without limitation, the pro shop, clubhouse, and food and
beverage operations and facilities in a manner consistent with the City's policies and procedures.
The RFP was also to include a provision for a public benefit contribution to the City's educational
initiative.
On September 12, 2018, the Mayor and City Commission approved the month to month extension of
the existing agreement with Professional Course Management, not to exceed ninety days.
Additionally, the issues that arose at the last meeting with respect to complaints from a resident have
been resolved and there is no further objection to the award by that individual.
RFP PROCESS
On May 18, 2018 issued RFP 2018 -186 -WG for Golf Course Operation and Management Services.
RFP responses were due and received on August 3, 2018. The Procurement Department issued
solicitation notices to 341 firms utilizing PublicPurchase.com. 53 prospective proposers accessed the
advertised solicitation. The City received proposals from the following two (2) firms: Hampton Golf,
Inc., and Professional Course Management.
The Evaluation Comrrittee appointed by the City Manager, pursuant to LTC# 433-2018, convened
on August 22, 2018, to consider the proposals received. The Committee comprised of Jose Del
Risco, Assistant Director, Parks and Recreation Department, Rodney Knowles, Greenspace Division
Director, Public Works Department, Omar Luna, Director, City of Miami Springs Parks and
Recreation, Gerald K. Schwartz, Resident, Margarita Wells, Assistant Director, Environment and
Sustainability Department.
The Committee was provided an overview of the project, information relative to the City's Cone of
Silence Ordinance and the Government Sunshine Law. The Committee was also provided with
general information on the scope of services and a copy of each proposal. The Committee was
instructed to score and rank each proposal pursuant to the evaluation criteria established in the RFP.
The evaluation process resulted in the ranking of proposers as indicated in Attachment A.
Below is a summary of each firm based on the information provided in the proposals
Professional Course Management (PCM)
PCM's business strategy has been to manage golf courses exclusively in Dade and Broward
counties. The greatest asset of PCM and its principals are the personal relationships that they have
created and maintained over the last 35 years in the South Florida golf market.
PCM and its staff are proud of their achievements over the past 17 years operating the Miami Beach
Page 1242 of 1637
Golf Club and Normandy Shores Golf Course. They believe continuity and consistency are the keys
to the long-term success of their company. Their goal is to continue a long mutually beneficial
relationship between the City, PCM and the residents of Miami Beach.
Hampton Golf, Inc.
Hampton Golf is a "boutique" style management firm that will only add a new golf facility to their
portfolio when they can ensure that their services will continue to exceed their current clients'
expectations and those of their new client.
Hampton Golf's technological advancements and continued success in competitive golf markets
throughout the country, especially within the State of Florida, qualifies Hampton Golf to provide the
level of management services the City deserves and should receive.
CONCLUSION
I have reviewed each firm's submissions and the results of the Evaluation Committee process. I find
that both firms have excellent qualifications and experience, and have submitted very comprehensive
proposals. In considering proposals, I note that the RFP stipulated that evaluation criteria would
include qualitative factors (proposer experience, approach and methodology, and public benefit), as
well as the cost to the City. While the overall cost is important, selecting an operator that maintains
the high standards and level of service currently provided to patrons of the golf clubs is of the highest
priority. In fact, service levels are so important that the RFP provided 70 out of 100 possible
evaluation points to selecting the best qualified operator, with 30 points allotted for cost.
In considering the best qualified operator, it is important to note that four of the five Evaluation
Committee members found that Professional Course Management was the best qualified of the two
firms. The Evaluation Committee's determination is supported by the findings from an independent
review analysis conducted by National Golf Foundation consulting (NGF), which at the request of the
City, conducted a business analysis of Miami Beach Golf Club (MBGC) and it revealed that MBGC
is one of the top municipal golf operations in the country, with an outstanding, very well maintained
golf course and net operating income performance that places the facility in the top 2% of municipal
golf facilities in the United States, even considering the revenue constraint resulting from resident
green fees that are well below 'market' rates. Additionally, NGF's business evaluation found MBGC
to be in very good condition, befitting its price point and golfer expectations of "country club for a
day". The opinion is validated by the very strong ratings which MBGC garners though its Golf Outing
Evaluation forms, where 'excellent' ratings are generally in the 80% to 100% range (depending on
golf course component and year), and not a single rating was just 'fair' or 'poor' among responses
over a 5 -year period. The NGF report is attached as Attachment B.
After more than 15 years at MBGC and Normandy Shores Golf Course (NSGC), PCM staff has had
very little turnover, and thus has significant institutional knowledge with the property. As with golf
course conditions, golfers have a level of expectations with overall facility service that is
commensurate with MBGC's premier golf course status.
In addition to golf, the restaurant/bar is heavily used by both golf and non -golf lunch customers for a
quality dining experience and both MBGC and NSGC have served as locations for numerous city
and neighborhood association meetings. Further providing evidence of their value as a resource to
the community, MBGC and NSGC staff goes out to the community to teach the game to children,
conducting 6 -week sessions at the Scott Rakow, Flamingo Park and North Shore Park Youth
Centers.
Finally, as public benefit PCM will continue free junior golf programs that introduce the game of golf
to the youth of Miami Beach. From the introductory sessions at each of the youth centers (Scott
Page 1243 of 1637
Rakow, Flamingo Park and North Shore Park) to the twice weekly complimentary Normandy Shores
Golf Club Clinics which run throughout the entire school year and the weeklong Sumner Golf Camp
held with the Parks and Recreation Department, the staff of teaching professionals introduce and
instruct the golfers of tomorrow free of charge using the SNAG Coaching Kits and even provide free
US Kids golf clubs to the youth of Miami Beach. Additionally, PCM has also installed kid friendly tees
at Normandy Shores Golf Club, which coupled with a special junior rate of just $5 the City has
established, insure that children can continue applying the lessons learned and practicing the game
on the golf course. Further, PCM will support the City's educational initiatives with a $2,500 a year
donation during the term of the contract.
Again, while the Evaluation Committee has determined, and I concur, that PCM has provided the
best proposal with regard to qualitative criteria, cost is an important consideration. Accordingly, I
recommend negotiating first with PCM in order to possibly reduce the cost of services. If negotiations
are unsuccessful, the Administration would then negotiate with Hampton Golf.
Therefore, I recommend that the Mayor and City Con -mission approve the Resolution authorizing the
Administration to enter into negotiations with Professional Course Management; and if unsuccessful
in negotiating an agreement with Professional Course Management II, LTD; authorizing the
Administration to enter into negotiations with Hampton Golf, Inc.; and further authorizing the Mayor
and City Clerk to execute an agreement upon conclusion of successful negotiations by the
Administration.
FINANCIAL INFORMATION
Grant funding will not be utilized for this project.
Legislative Tracking
Parks and Recreation/Procurement
ATTACHMENTS:
Description
o Attachment A- Evaluation Committee Scoring and Ranking
❑ Attachment B - Independent Evaluation
o Resolution
Page 1244 of 1637
2 re
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1
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Page 1245 o(1637
Summary Business Evaluation of Miami
Beach Golf Club
Prepared For:
City of Miami Beach, FL
Parks and Recreation Department
1701 Meridian Ave., Suite 401
Miami Beach, FL 33131
Prepared By:
NGFCONSULTING
501 N. Highway Ala
Jupiter, FL 33477
(561) 744 6006
May, 2018
Page 1246 of 1637
Table of Contents
INTRODUCTION & PURPOSE 1
GOLF MARKET OVERVIEW 2
National Golf Industry Overview 2
Key Trends in Demand 2
Golf Course Supply 3
Local / Regional Market 3
Defining the Miami Beach GC Primary Trade Arca 3
Demographic Analysis 3
Estimated Local Market Demand 4
Local Golf Supply 4
Miami Beach Golf Club Competitive Market 5
Map of Primary and Secondary Competitors 6
Primary and Secondary Competitors - Summary Information 7
Primary and Secondary Competitors- Smnmary Operating Metrics 8
Key Findings - Miami Beach Golf Club and Competitive Set 9
Benchmarking Comparison - Broward and Miami -Dade Municipal Golf Operations 10
BUSINESS ANALYSIS OF MIAMI BEACH GC 12
Miami Beach Golf Club Renovation Overview 12
Management Agreement 13
Greeen Fee and Membership Pricing 13
Miami Beach GC Recent Operating Results 14
Rounds Played 14
Operating Revenues 15
Operating Expenses 15
YTD FY 2018 15
Net Operating Income - Longer -Term Performance (FY 2005 - FY 2017) 16
Summary 16
Golf Course Conditions 17
Staffing/Budget 18
Marketing / Direct Selling 18
Customer Service 19
Merchandise and Food & Beverage Concessions 19
Instruction and Programming 20
Juniors 20
South Beach International Amateur Tournament 21
Community Engagement 21
RecordKeeping / Reporting 22
SUMMARY STATEMENT 23
Page 1247 of 1637
APPENDICES 24
Appendix A — National Rounds Played Report '5
Appendix B — Local Demographic, Demand, And Supply 27
Local Demographics and Demand 27
Golf Supply 28
Supply -Demand 29
Appendix C — Regional Municipal Golf Benchmarking 30
Appendix D—Miami Beach GC Fee Chart 31
Appendix F — Miami Beach GC Operating Performance Exhibits 32
Exhibit I: Rounds History 32
Exhibit 2: Operating Revenue — City Perspective 33
Exhibit 3: Operating Revenue —Facility Perspective 33
Exhibit 4: Operating Revenue per Round — City Perspective 34
Exhibit 5: Operating Revenue per Round—Facility Perspective 35
Exhibit 6: Summary Performance — City Perspective 36
Exhibit 7: Profit Loss Yearly Comparison 37
Appendix F—Miami Beach Golf Outing Evaluations 38
Page 1248 of 1637
Introduction & Purpose
The City of Miami Beach Parks & Recreation Department ("City") retained National Golf Foundation
Consulting ("NGF" or "NGFC") to provide independent evaluation services related to its 1 8 -hole Miami
Beach Golf Club ("Miami Beach GC" or"MBGC") and its long-time private operator, Professional
Course Management ("PCM" or "Operator"). Because the management contract for MBGC has not been
put out to competitive bid since the facility renovation, the City is issuing a request for proposals (RFP)
this spring for management services of both MBGC and the City's other municipal golf asset, Normandy
Shores Golf Course, after several renewals of the existing agreement with PCM.
Miami Beach GC, the former Bayshore Golf Club, is a highly valued and profitable asset for the City and
its residents, and has enjoyed a renaissance in terms of both quality and performance since its $8 million
renovation completed in 2002. Miami Beach GC is currently positioned as a premier public access golf
course in the highly competitive south Florida golf market. NGF was retained - in advance of RFP
responses being submitted - to provide a summary operations review and performance assessment for
MBGC, and to provide and independent validation of what the City believes to be very strong
management performance at MBGC. NGF has also provided a benchmarking analysis of key operational
metrics across a subset of south Florida municipal golf courses, for comparison to Miami Beach GC.
This document comprises a summary of key NGF findings, and includes (but is not limited to):
► Summary market analysis comprising demographic & economic profile, golf supply and
demand indicators, and identification of key competitors.
► Review of management, marketing and programming practices, as well as golf course
conditions.
I. Analysis of recent historical operating performance.
► Benchmarking analysis of Miami Beach GC and other Miami -Dade County and Broward
County competitive and/or comparable golf facilities.
The study effort was managed by NGF Director of Consulting Ed Getherall, with in -field assistance from
Senior Director of Consulting Richard Singer and administrative support from Consulting Administrator
Jodi Reilly. NGF's activities conducted in completion of this report included:
► Meetings and/or interviews with:
• The City's Director and Assistant Director of Parks & Recreation
• Professional Course Management owner / president
• MBGC key staff, including the General Manager, Head Golf Professional , Director
of Marketing, and Golf Course Superintendent
• Area golf operators
► Facility tour, including clubhouse, golf course and practice facility
► Analysis of recent MBGC financial statements / other materials pertaining to the operation
► Golf market analysis and research
National Golf Founds 14ijrfI1,37City of Miami Beach— Miami Beach Golf Club -1
Golf Market Overview
Below, NGF Consulting provides a summary of key "external" factors that characterize the trade area in
which Miami Beach Golf Club operates, as well as NGF's macro perspective of the U.S. golf industry.
On a local/regional basis, the overview includes basic demographic measures that have the potential to
affect the economic performance of the golf facility, as well as an analysis of supply and demand
indicators in the public golf market.
NATIONAL GOLF INDUSTRY UA ICRV1
While socio -demographic, financial and cultural headwinds certainly persist for golf, the industry
continued its macro trend toward stabilization in 2015-2017. The game remains popular and is fortunate
to have a deep well of interested prospects. While golf's pay -for -play green fee revenues and other
spending will always be vulnerable to outside forces such as weather and the economy, its chief challenge
remains getting more of those non -golfers who express interest in playing ('latent demand'') to actually
give golf a try, and converting more beginners into committed participants.
Still, some socioeconomic and demographic trends continue to present challenges for golf operators. For
instance, golf is having trouble attracting and retaining minorities and young adults (i.e., Millennia's);
though this segment continues to account for a large percentage of annual play and spending, factors such
as debt and competing recreational activities have suppressed golf demand from this segment.
Key Trends in Demand
► Participation - The national golfer number (participation) continues to show some net
attrition, primarily among occasional/less committed golfers. Overall, NOF survey research
indicates that in 2016 there were 23.8 million people in the U.S. that played at least one round
of golf in the prior year, about +l.2 million fewer than in 2012. However, the vast majority of
"core" golfers remain in the game.
► Rounds Played 2016-17 / Looking Ahead — Nationally, rounds played were down 2.7%
year -over -year in 2017, at least partially attributable to weather events. For Florida overall,
rounds were down 1.3%, despite a nearly 19% decline in September (Hurricane Irma). The
Miami -Ft. Lauderdale market was down by 0.9%. YTD 2018 is off to a rough start nationally
and in Florida, with rounds down by 5.6% and 6.6%, respectively, year -over -year through
March. Miami -Ft. Lauderdale was down by 7.2% through March (data source: Golf Datatech
— see Appendix A).
► Baby Boomer Effect — As Baby Boomers age and retire over the next 15 years, we expect to
see a measurable increase in total rounds played in the U.S. Boomers - born between 1946
and 1964 - are currently 53 to 72 years old. About 6 million of them arc golfers; that's about
1/4 of all golfers, and they currently play about 1/3 of all rounds. Boomers started turning 65
in 2011, and already 1 million+golfing Boomers have reached retirement age. The Social
Security Administration reports that 10,000 or more Boomers retire every day. And —300,000
Boomer golfers will turn 65 each year for the next 15 years. Retired Boomers (age 65+) play
about twice as much as younger, non -retired Boomers (40 rounds vs 21 rounds).
National Golf FoundarkgifioS4637City of Miami Beach - Miami Beach Golf Club - 2
Golf Course Supply
The correction in golf course supply continued in 2017 at a level comparable with the previous several
years. According to NGF data, since the market correction in golf course supply began in 2006, there has
been a cumulative net reduction of golf courses equivalent to about 6.9%. For perspective, golf supply
grew by 44% in the previous 20 years (1986-2005). Closures continue to be disproportionately high
among 'value' priced (peak green + cart fee below $40) facilities; in 2016, nearly 70% of closures fell
in this category. Many golf courses shutter due to competitive dynamics; increasingly, however, golf
courses — especially in geographies where developable land is at a premium — are closing because
residential or commercial is a much "higher and better use". This stove toward supply/demand
equilibrium is expected to continue for several years. (Later in this section, we will discuss golf course
supply trends for the Miami -Dade and Broward markets).
1,0('A 1., 112LGIONAL SI ARKET
To put MBGC's activity levels and performance into context, the environment in which the facility
operates must be understood. Therefore, it is helpful to examine local demographic factors that have the
potential to impact rounds played and fee tolerances. This overview includes an analysis of the area's
demographic profile and trends relative to their potential impact on demand for golf. (See Appendix B for
a summary table with all the measures and metrics referenced in this section). In the second part of this
section we provide an overview of key golf market demand and supply indicators, as well as a summary
review of the competitive market for MBGC.
Defining the Miami Beach GC Primary Trade Area
A number of factors assist in determining the expected market arca for a golf facility. In addition to the
quantity, quality, and nature of existing competitive facilities in the area, the availability of highway and
major thoroughfare infrastructure, traffic patterns, economic and demographic factors, and the propensity
for golfers to travel to play golf all play a role in establishing the primary market area for a golf facility.
NGF research shows that golfers are willing to travel up to 30 minutes to regularly play their favorite golf
courses, and occasionally longer to play `luxury" rounds at higher quality courses.
Based on these factors, as well as our knowledge of this market, interviews with area golf operators, and
the distribution of public golf course supply in the greater Miami area, NGF expects that the majority of
demand for MBGC to come from Miami, Miami Beach and surrounding communities generally within a
15 -mile range of the course. This market stretches north to the Hollywood/Pembroke Pines area, west
towards the Florida Turnpike, and south toward the south Miami/Kendall area. Of course, a high quality
facility such as MBGC will also draw some demand from further away, including the Ft. Lauderdale area.
Demographic Analysis
Below, we summarize the population, median age, and median household income trends for the 15 -mile -
market around MBGC, as well as Broward and Miami -Dade Counties overall, derived from U.S. Census
Data and NGF's Golf Market Analysis Platform (GoIfMAP). NGF observations:
► There are an estimated 2+ million people living in MBGC's defined primary trade area,
indicative of a dense urban population. Annual population growth rates in the local market
are projected to be about 40% to 50% higher than the national rate of growth between 2017
and 2022. Overall, the 15 -mile primary trade area is expected to add about 116,000 net new
residents in the next five years.
► The Median Age in the primary trade area for MBGC is moderately higher than the national
median of 38.1 years. In general, the propensity to play golf with greater frequency increases
with age, making older markets more attractive to golf facility operators, all factors equal.
National Golf Foundap SovStirdtlpard-/City of Miami Beach — Miami Beach Golf Club -3
► At just over S44,000, the Median Household Income in the 15 -mile trade area for MBGC is
25% lower than the national median of $59,240. We note, however, that there are many
pockets of very high income neighborhoods in immediate proximity to the club. In general,
higher income residents arc more likely to participate in golf, and they play more frequently
than lower income residents.
Estimated Local Market Demand
NGF summary observations regarding key golf demand characteristics of the local market area:
► Both the primary trade area and Miami -Dade County overall have age, income and other
demographic characteristics that tend to coincide with lower -than -average participation in
golf. The overall golf participation and demand metrics for these markets is about 20% lower
than the US benchmark. However, resident golf demand is strongly supplemented by demand
from seasonal residents and visitors.
► NGF estimates about 79,500 golfing households in the 15 -mile market; population growth is
expected to add about 2,800 golfing households by 2022.
► Based on actual facility -reported and modeled data, NGF estimates that golf courses in the
15 -mile market arca and Miami -Dade County overall average about 44,000 to 45,000 rounds
played per 18 holes annually, compared to the national average of+33,000 rounds. (We note
that public course -only averages are higher, especially among lower price point courses).
Area visitors (nearly 16 million stayed overnight in Miami -Dade County in 2016) contribute significantly
to golf course activity in the region, with peak demand during the winter/early springtime. NGF research
shows that roughly one-third of all golfers participate in the activity while traveling, playing 0.557 rounds
per day of travel. As a premier public golf course located in the heart of a tourist destination, Miami
Beach, MBGC draws considerably from these visitors, especially through its relationships with area
hotels and the convention center (renovation soon complete).
The greater Miami area is home to numerous large employers that are sources of demand for both golf
and food & beverage service at area golf courses (e.g., tournaments, corporate team building events and
meetings). Additionally, groups such as civic & fraternal organizations and churches are candidates for
organized activities such as outings and leagues. These types of activities arc an important supplement to
daily fee rounds for public golf courses, especially in today's hypercompetitive golf markets, but require
an organized direct selling effort.
Local Golf Supply
NGF observations regarding key golf supply measures for the local market, including demand/supply
ratios - numbers that act as a proxy for facility oversupply or undersupply, relative to the US benchmark
(US = 100):
► There are 21 total golf facilities (includes 15 public, 10 of which are municipal) in MBGC's
primary 15 -mile trade area. After the spate of closures over the last decade+ (more below),
there are now 25 total golf facilities (19 publie/11 municipal) in Miami -Dade County.
► Ratio analysis based on national benchmarks shows that the 15 -mile market area has about
2.6 times as many golfing households available to support each 18 holes of golf compared to
the national benchmark.
National Golf Foundapiodboilidni3f1.5537City of Miami Beach— Miami Beach Golf Club -4
► The phenomenon of golf course closures has been particularly acute in Broward and Miami -
Dade Counties, where changing demographics have been a key factor. Twenty golf courses
(17.5 eighteen hole equivalents) have closed in Broward County and 11 have closed in
Miami -Dade (10 18H -EQ) in the last 15 years. Few markets in the country have lost as many
golf holes during that time. The Ciry of Miami is reportedly considering re -use options for
International Links— Melreese CC, one of MBGC's foremost competitors.
► The NGF database shows no new golf course projects under development in either Miami -
Dade or Broward Counties.
VIH.AAl l RICACi1 GOLF (1.013 (ONIPICIITIAI? }IARKF`C
Based on the market positioning of Miami Beach GC, NGF identified a subset of primary and secondary
competitors for the golf facility. These facilities were chosen based on factors such as price point,
location, type (18 -hole or greater public regulation length only) and amenities offered, and comprise both
municipal and privately owned daily fee operations:
Primary Competitors
Secondary Competitors
Biltmore Golf Course
acaranda Golf Club
Crandon Golf at Key Biscayne
International Links Miami—Melreese CC
Miami Shores Country Club
Plantation Preserve Golf Course
This list was not meant to be exhaustive or to account for all of the potential public golf compe ition to
Miami Beach GC. For instance, off season pricing (dynamic) at the Trump National Doral Golden Palm
and Red Tiger courses, as well as the Silver Fox, can be comparable to, or even lower than, MBGC's non-
resident rates, especially in off peak times.
A map illustrating the relative locations of Miami Beach GC and the identified competitors is shown
below. Following the map, we provide NGF key findings regarding the competitive market as well as
summary operating information such as peak green fees, rounds played, and summary operating metrics.
National Golf FoundWgrwf 46.37C it of Miami Beach — Miami Beach Golf Club — 5
Map of Primary and Secondary Competitors
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Jacaranda Golf Club X O
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International Links Miami - Melreese Countr Club X
Bil more Golf Course X
Crandon Golf At Ke Biscayne XI
National Golf FoundacorrAnf 'per/City of Miami Beach - Miami Beach Golf Club - 6
Primary and Secondary Competitors—Summary Information
The table below provides summary information for MBGC and the identified subset of primary and
secondary competitive golf facilities.
National Golf Founda of 1p6.37City of Miami Beach - Miami Beach Golf Club - 7
Key Competitors - Regulation Public Access
Facilities
Colf Facility
Location
Type
Year Open
1932/2002
Par /
Slope
Front Tee /
Back Tee
Location
Relative to
Miami Beach
Coif Club
Miami Beach GolCClub
MiamiShoresGolfClub
Miami Beach
Miami Shores
18H -MU
72/128
5,908/6,813
-
1811 -DF
1939
72/131
5,031/6,705
5 miles NW
Crandon Golf Key Biscayne
Key Biscayne
18H -MU
1972
72/ 148
5,192 / 7,325
6.5 miles South
Intl. Links Miami-Melrecse CC
Miami
181 -1 -MU
1960
71 / 128
71 / 121
5,534 / 7,270
5,201 / 6,772
7.5 miles W/S W
Biltmore Golf Course
Coral Gables
18H -MU
1924
10 miles SW
Pembroke Lakes Golf Club
Plantation Preserve Golf Club
Pembroke Pines
18H -MU
1974
72/140
5,160/6,815
18 miles NW
23 miles NNW
Plantation
1811 -MU
2006
72 / 134
5,182 / 7,071
Jacaranda Golf Club
Plantation
36F1 -DF
1971
24 miles NNW
East
2006 rend.
71 / 129
4,923 / 7,247
West
72 / 131
5,026 / 6,778
National Golf Founda of 1p6.37City of Miami Beach - Miami Beach Golf Club - 7
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Key Findings — Miami Beach Golf Club and Competitive Set
A summary of general findings regarding the competitive market for MBGC:
► Based on location, proximity and price point, Miami -Dade County's Crandon Golf at Key
Biscayne is the most direct competitor and comparable facility to Miami Beach Golf Club among
the competitors identified above. Jacaranda GC and Plantation Preserve, while 20+ miles north of
MBGC, qualify as secondary competitors based on then being among the premier public golf
facilities in Broward and Miami -Dade, and the fact that they are likely prevent some golf demand
from southern Broward County golfers from migrating south.
► NGF summary observations regarding key operating metrics for MBGC and its identified
competitors:
• Excluding Trump National Doral, at $225 non-resident rate in -season MBGC has the
highest green fees among south Florida public golf courses. Al ±$200, Biltmore GC
and International Links arc the next highest among the competitive set.
• With average golf fce revenue (green + cart + membership) per round of $83, MBGC
was easily the highest among the competitive set, about 523 higher than International
Links and $30+ higher than both Plantation Preserve and direct competitor Crandon
Golf Key Biscayne. The gap with Crandon and International Links is especially
impressive given the relative closeness in peak season rack rates, and is a sign of the
City and golf course staff doing an excellent job of maintaining rate `integrity'.
• Average rounds played per 18 holes among this subset were approximately 40,500.
MBGC exceeds this average despite the highest green fees in the market. MBGC has
similar activity levels to key competitor Crandon Golf, but at a much higher rate.
• Despite including only net payments for the pro shop and food & beverage
concessions, total revenue at MBGC is the highest among this subset, and more than
$700,000 higher than at Crandon.
• Both Crandon Golf and International Links have higher operating expense profiles
than MBGC, though Links has expenses associated with the maintenance of its First
Tee Miami building, and Crandon reportedly has a water bill of about $1 million.
• MBGC and Plantation Preserve each generated more than $800,000 in net operating
income in FYI6. By comparison, Crandon Golf lost about $230,000 — number that
increased to SI million in FYI 7.
► As NGF has observed in many other markets, newer golf courses (e.g., Plantation Preserve, Palm
Beach County's Osprey Point), those that have invested in improvements (Pembroke Lakes,
Miami Beach Golf Club, Jacaranda GC, International Links Miami), and those that have a very
strong customer service profile (i.e., "country club for a day") have fared the best in this regional
market, while those that have deferred capital improvements and everyday course maintenance
(Country Club of Miami; many examples in Broward County) have seen declining demand and
financial perfonnance.
► In addition to annual and seasonal memberships (pre -paid green fees), facility -specific loyalty
programs (such as Miami -Dade Patron Card), and web specials, discounted fees are also available
through various programs such as CanAm, PGA GolfPass (Palm Beach and Broward), and the
Premier Golf Card (owned by Golfnow), as well as through third party tee time providers such as
Golfnow.
National Golf Founda b'oppi ri fI55.37City of Miami Beach — Miami Beach Golf Club — 9
► The Premier Card has resulted in increased activity levels at many south Florida golf courses,
especially during the long off season. Premier has been in existence for 27 years and offers
features such as 5 -day advance booking and discounted green fees (some cart -only during off
season). Along with MBGC, local courses that participate in the Premier Card program include
International Links, Plantation Preserve, Pembroke Lakes, Normandy Shores and Miami Shores.
► The presence of a "buyer's market", the extreme seasonality of demand in south Florida, and the
various discount programs in this market (like most nationwide) have resulted in average daily
rates (ADRs) that have been essentially flat for 5 or even more years. It is not unusual for even
high quality public golf courses in this market to see rack green + cart fees fall as low as +530 for
a peak weekend morning round in summer.
Benchmarking Comparison — Broward and Miami -Dade Municipal Golf Operations
NGF Consulting compiled a FY2016 benchmarking analysis of some basic operating metrics for south
Florida (Broward, Miami -Dade, Palm Beach) municipal golf operations. Key findings relating to Miami
Beach GC's performance, pricing, etc. compared to the subset of reporting Broward and Miami -Dade
municipal golf operations follow. The sources for this information are municipal comprehensive annual
financial reports (CAFRs) and data supplied directly by municipal and/or golf course staff. The total
sample set, excluding MBGC, for these two counties comprises 9 facilities (I 1 courses). The summary
table can be found in Appendix C.
Key NGF findings:
► From a pricing perspective, the responding facilities comprise a mix of low -market (e.g.,
Orangebrook, CCM), mid -market (Pembroke Lakes, Plantation Preserve, Normandy Shores) and
upper tier (MBGC, Crandon, International Links) golf courses. Three facilities -- Crandon, CCM,
and Palmetto GC arc owned and operated by Miami -Dade County. Three — MBGC, NSGC, and
Pembroke Lakes — are managed by PCM.
► On a per 18 -hole basis, Plantation Preserve is the most active among the benchmark subset, with
48,000+ rounds in FY16. This was achieved at an average rate of S52; MBGC's rounds, by
contrast, were about 11% lower but achieved at an average daily rate (ADR) of $83, or 60%
higher than Plantation Preserve. In public golf, there is generally an inverse relationship between
rounds activity and green fee level. MBGC has been able to eam a high rate per round while still
reaching or approaching its desired activity levels.
► The lowest ADRs among the benchmark set belonged to the City of Hollywood's 36 -hole
Orangebrook G&CC atjust $19.93, followed by Miami-Dade's Palmetto GC atjust under $24
and Country Club of Miami at $25.36. Both Orangebrook and CCM suffer from significant
deferred maintenance and capital needs.
► Excluding MBGC, five of the nine facilities had negative net operating income in FYI6.
Pompano Beach GC, which has more than $600,000 in City Admin & Overhead and $156,000 in
FAA land rent included on its expense books, lost more than $1 million, while CCM lost
$942,000. Crandon Golf Key Biscayne lost $229,000, a deficit that climbed to $1 million in
FYI7, approximately the amount of the golf course's water bill.
► MBGC, at $3.54 million, earned more than SI million more in golf fee revenue than the next
highest facility, Plantation Preserve. MBGC had only about $180,000 more in total revenue (city
perspective) because only concession net payments are included. In terms of NOI, MBGC and
Plantation Preserve are easily the most profitable of the benchmark subset, at $824,000 and
$845,000, respectively.
National Golf Founda[pg§gnpAgrnpi63f ity of Miami Beach — Miami Beach Golf Club — 10
► In addition to the municipal golf courses listed in the table, NGF was able to find some
information for several others that did not provide information.
• The City of Sunrise's 18 -hole executive course, Seven Bridges at Springtree, hosts
about 38,000 rounds and lost nearly $700,000 from operations in FYI6.
• The City of Davie's 18 -hole Davie G&CC is operated under lease agreement and
gains or loses a `nominal' amount each year.
• The City ofTamarac's 36 -hole (18 Reg. + 18 Exec.) Colony Wcst Country Club lost
about $400,000 on 61,000 rounds in FY 16.
• The City of Miami Springs' 18 -hole Miami Springs G&CC has traditionally lost
hundreds of thousands each year, though the deficit is reportedly decreasing with
improved course conditions and higher rounds.
National Golf Foundaf§'BnF(nfity of Miami Beach — Miami Beach Golf Club — I I
Business Analysis of Miami Beach GC
In this section, NGF Consulting provides a summary business review of the Miami Beach Golf Club,
comprising: NGF's subjective analysis of PCM performance in various functional areas based on our
review and the Consultants' 45+ years of collective experience evaluating golf course operations; and, an
objective analysis of facility financial performance — both stand-alone and benchmarked against regional
municipal golf operations.
Information in this section is based on NGF's review in the spring of2018, including meetings and
interviews with MBGC and PCM management, facility tour, review of recent historical operating
information and other documentation, and, market analysis. We note that our on-site review was limited
to a one -day facility visit; however, we are confident that what the consulting team observed and
experienced is representative of the everyday product quality and customer service profile of Miami
Beach Golf Club.
NGF's summary findings for MBGC arc presented below, following an overview MBGC's 2001-02
renovation.
MI KI ACI -i GOLF CLUB IiPAOA"AFlu A OA' I(ItV'll?VA
In December of 1998, the City of Miami Beach retained a consultant to perform an evaluation and
analysis of the City -owned golf courses with the objective of assessing development alternatives, market
and financial potential. Pursuant to the recommendations and conclusions of the report, the Mayor and
City Commission voted to finance the complete renovation of Bayshore and Normandy Shores golf
courses and related facilities. The City retained the retained highly respected golf course architectural
firm, Arthur Bills, Steve Forrest and Associates to design plans for an upscale, visitor -oriented course at
the Bayshore GC site and a more modest, but high quality `resident' course at Normandy Shores.
The following is excerpted directly from materials supplied to NGF Consulting:
"The City's primary objective was to reposition Bayshore and Normandy Shores with the goal of creating
an attractive new amenity to improve the appeal of Miami Beach as an upscale visitor destination, while
providing residents access to top quality public golf at reasonable rates, and insuring that golf course
revenues fully cover maintenance and operating expenses.
In August of 2000 the City initiated the RFP process for the Comprehensive Management and Operation
of the City's Golf Courses, Clubhouses and Related Facilities. On November 29, 2000, the Mayor and
City Commission accepted the recommendation of the City Manager and authorized the Administration to
enter into negotiations with Professional Course Management II, L I -D,, (PCM) for these services.
The reconstruction of the Bayshore Golf Course, subsequently renamed the Miami Beach Golf Club at the
recommendation of PCM, began in December of 2001. The newly renovated facility opened on December
17, 2002. Prior to opening the Administration entered into an interim professional services agreement
with PCM to manage the golf course until the long term agreement was completed. The Management
Agreement for the Comprehensive Management and Operation of the City's Miami Beach Golf Courses,
Clubhouse and Related Facilities between the City of Miami Beach and Professional Course Management
Il, LTD., (PCM) was negotiated in September 2003. Normandy Shores Golf Club construction began in
May, 2007 and that golf course was opened in December of 2008. In May of2010 Normandy Shores Golf
Club's new clubhouse was opened."
National Golf Foundation Consulting, Inc. - City of Miami Beach - Miami Beach Golf Club - 12
Page 1260 of 1637
t.IVerkC,F ill A I _iI,14l ikhi'.5'G
Both Miami Beach Golf Club and Normandy Shores Golf Course are owned by the City of Miami Beach
and operated by PCM. Golf is not accounted for as an enterprise fund, but rather as a separate account
within the City's Parks & Recreation Department. The original agreement with PCM for MBGC had a 3-
year tenn, with two 1-year renewal options. PCM has subsequently been renewed twice for 5-year terms,
in 2008 and 2013. Inc current agreement with PCM expires on September 30, 2018. PCM is responsible
for all aspects of facility management, and has separate concession agreements for merchandise, food &
beverage operations, and lessons (PCM subleases to Jim McLean Golf School).
The City is responsible for all expenses except those related to the concessions, for which it receives 5%
of food & beverage revenues and pro shop sales, and 20% of lesson revenues. The City receives 100% of
green, cart, membership, range and miscellaneous other revenues.
NGF Summary findings:
► PCM received a $125,000 base management fee in the first year of the most recent renewal
period, increasing in subsequent years by the CPI index or 3%, whichever is smaller. In
addition, PCM is eligible for an incentive fee, capped at $125,000. The full $125K is payable
if net operating income before debt service equals or exceeds $800,000 (fee is reduced by
proportionate percentage to NOI below $800K). There is the potential to earn an additional
5% incentive fee on gross revenues above $4 million. In the 2013 renewal, the compensation
formula for PCM was adjusted to become more incentive -based than the previous deals.
► In FY16 and FY 17, PCM's total management compensation was $250,000 and $234,603,
respectively. The effective percentage compensation in these years was 6.4% and 6.3% of
total facility gross revenues (City perspective), respectively. Based on NGF experience, both
the structure of the City's management agreement with PCM (base management fee plus
incentive) and the effective compensation are within expectations for a premier municipal
golf course at this price point and revenue level.
GREEEN hfl ANI) til AIHERSIIIP PRICING
With non-resident peak season green fees of $225, Miami Beach Golf Club has the highest green fees in
south Florida for municipal golf courses, and trail only Trump National Doral ($400+ peak season)
among all public courses. Miami Beach and south Florida (Palm Beach, Broward, Miami -Dade and
Monroe counties) enjoy considerable discounts, with peak season fees of $80 and $120, respectively. The
City Commission has final authority on setting of golf fees at MBGC.
► As is the case with every public golf course in south Florida, MBGC has considerably lower
rates during the shoulder and summer seasons (complete fee schedule in Appendix D).
However, unlike the vast majority of municipal golf courses, MBGC has few green fee
categories that offer discounts off of rack rates due to the quality of, and demand for, its
product.
• Aside from the Canadian Golf Pass ($10 off south Florida resident rate; accounts for
fewer than 1,000 annual rounds), MBGC offers discounted rates only through the
Premier Card, which provides 10% and 15% discounts off of peak season and off
season fees, respectively, and which has accounted for anywhere between 13,000 and
17,000 summer rounds each year. Hotels are not offered special rates, though
concierges receive a 20% commission for referring individual and group play.
National Golf Foundation Consulting, Inc. - City of Miami Beach - Miami Beach Golf Club - 13
Page 1261 of 1637
► Miami Beach GC resident green fees have changed very little over the years, with only a $5
increase since 2007. South Florida peak season resident rates have increased by only S20,
from $100 to $120, while non-resident fees were $150 at inception and are now $225.
► MBGC also offers a membership program offering unlimited green fees, $20 cart fee, 19 -day
advance tee time (public is 5 -day), and preferred guest rates, among other benefits. The
program is capped at 200, with a waiting list of 40+; —95% of members are Miami Beach
residents (including many seasonal). Pricing for singles is $3,500, and for couples $4,500.
► NGF key findings regarding MBGC fee structure:
• MBGC's pricing model was set up so that revenue would be maximized from visitor
rounds, thus allowing the City to `subsidize' affordable golf fees for Miami Beach
and south Florida residents as a matter of public policy. Additionally, fees are set
with the goal of attracting rounds volume in the low to mid 40,000s, so as to not put
too much maintenance strain on the golf course and preserve a premier golf
experience and provide good pace of play. NGF observes that (hese objectives have
been served by the overall pricing structure and policies.
• While the pricing structure adheres to public policy goals, we do note that revenues
are significantly constrained by offering resident fees that are well below `market
rate'. This is not an uncommon strategy among premier municipal golf courses in the
US. Examples where there are large municipally mandated differences between
resident and non-resident rates are the City of San Diego's Torrey Pines, Indian
Wells Golf Resort, Desert Willow Golf Resort (Palm Desert), and Bethpage State
Park Golf Course (State of New York).
\IIAVtI BEACH G(' 121 (EV"I on* VIM: RESULTS
Below, NGF summarizes key findings regarding the financial results of Miami Beach GC for the FYI3
through FY 17 time period, as well as year-to-date FY18. (Please refer to exhibits in Appendix E).
Rounds Played
As discussed earlier, the City — from the inception of the renovated Miami Beach Golf Club — established
that the club would be expected to adhere to certain parameters related to activity levels, rate achieved,
and course conditions. To maintain the operating and maintenance model the City desired, it was
determined that rounds played should generally fall into the T45,000 range each year, thus maintaining
great golf course conditions, fast pace of play, and overall customer experience. Below are NGF's key
findings about rounds activity at MBGC over the subject period.
► Total rounds played have been on a downward trend since peaking at more than 47,000 in FY 14,
though there have been some intervening factors that have contributed to the decrease. Overall,
rounds in FYI7 were 13.2% lower than in FY 14, though the former year represents an outlier
(on the high side) for rounds activity at MBGC since reopening. External factors suppressing
rounds played in recent years include the renovation of the Miami Beach Convention Center
beginning in 2016, the Zika virus in 2017, and hurricanes in both 2016 and 2017 (Irma). Also,
NGF was told that hotel room rates have increased significantly in Miami Beach, perhaps
putting a strain on discretionary income available to visiting golfers.
► MBGC has consistently received about 36% to 37% of its total play from rack rounds; the
percentage of these rounds that has come from Miami Beach residents has increased from about
16% of play in the 2013 —2014 period to the current level of about 20%. Member+ guest
rounds have increased over the last five years from about 10% of total play to about 16%, while
Premier Summer members played 31% of rounds in FYI7, down from just under 38% in FY13.
National Golf Foundation Consulting, Inc. — City of Miami Beach — Miami Beach Golf Club — 14
Page 1262 of 1637
► Both Premier and unlimited play members have helped management to achieve a high level
of play throughout the year, despite the strong seasonality of demand in south Florida.
MBGC's busiest month the last two years was May - not traditionally the strongest in this
climate — and the facility hosted nearly 4,000 rounds in July 2017.
► Despite some constraints with regard to facilitating large outings during the peak season,
MBGC is very active with tournaments, hosting between 4,000 and 4,500 rounds per year.
Operating Revenues
► Golf fee revenue was $3.75 million in both FY I4 and FYI5, subsequently decreasing by
about 5% in FY 16 and another 5%+ in FY 17 in the face of lower rounds played. Total
revenue (City perspective) has declined each year since reaching $4.1 million in FYI4, and
was about 8.8% lower in FYI7 than that recent high water mark.
► Golf fee revenue per round has generally been in the range of $79.50 to $83.20 during the
five-year time period, with the exception of FY15 when the average rate reached $87.15.
► Other revenue centers:
• The driving range has been a consistent performer at Miami Beach Golf Club, at t$4
per round.
a Pro shop lease revenues per round have followed a 'bell curve' pattern, peaking at
$0.97 in FYI5, and subsequently declining to $0.87 in FYI7.
▪ Food & beverage lease revenues per round have increased from $0.99 in FY13 to
$L23 in FYI7.
+ Lesson revenues to the City (@ 20% of gross) have more than doubled over the five-
year period, from about S70,000 to more than $143,000
► Total revenue per round (City perspective has been just under $92 the last two full fiscal
years, after reaching $94.54 in FY15
► With an increase of about 10% in the revenue budget in FYI5 and the decline in revenues
over the last few years, the annual revenue budget variance has reached 5400,000+ during the
last two fiscal years, and has totaled more than $1 million over three years.
Operating Expenses
► Miami Beach GC's total operating expense has been very consistent over the last four years,
ranging between about $3.07 million and $3.1 million, despite increased costs from adding
the streetscape maintenance responsibilities in 2017.
► The FYI7 total expenditures for labor and benefits were just over $1.5 million, including
$816,000 for the maintenance department. At about 50% of the total expenditures, this level
is within norms of industry standards as observed by NGF Consulting.
► The total golf course maintenance budget for FYI7 was $1.56 million, which is at the high-
end of the range public 18 -hole golf courses, and appropriate for a golf course of this caliber
and price point.
YTD FY 2018
As the table below illustrates, key indicators are all up for the first seven months of FY 2018, including
rounds played (up by 7.6%), total revenues (9%), and total golf fee revenue per round (2.1%).
National Golf Foundation Consulting, Inc. — City of Miami Beach — Miami Beach Golf Club — 15
Page 1263 of 1637
YTD (thru April ) FY2017 vs. FY2018
(City Perspective)
Oct 2016- April 2017 1 Oct 2017-A.ri12018
Golf Fee Revenue $2,213,830 $2,432,355
Total Revenue $2,466,455 $2,689,202
Rounds played 24,466 26,315
Golf revenue per round $90.49 $92.43
Total revenue per round 5100.81 $102.19
Net Operating Income - Longer -Term Performance (FY 2005— FY 2017)
NGF took a longer-term view of MBGC in the context of net operating income (NO1) performance since
FY 2005 (see summary table below). What emerged were about four distinct periods in terms of rounds
played and NOT performance, with the main variables causing differences in performance between these
periods owing largely to external factors:
► The FY05 through FY07 period was a period of strong performance, with average NOI of
about $965,000. The five-year period that followed included the financial crisis of 2008-09
and its lingering effects, such as large corporate outing cancellations (e.g., IBM, Morgan
Stanley) and the severe decline in business and leisure travel, resulting in a decline in NOI to
an average of $761,000.
► As those negative effects of the financial crisis began to wane, MBGC enjoyed a very
profitable three-year period between FY 13 and FYI 5, when it averaged more than $1.02
million in NOI on an average of 45,000 rounds played.
O. Finally, the triple challenges of the convention center construction, Zika virus scare and
Hurricane Irma have affected play the last two years, when average rounds declined by more
than 3,000 from the prior period, and NOI dropped by about 25% to an average of $740,000.
MBGC - Rounds and Net Operating Income (FY 2005— FY 2017)
FY05-FY07 FY08-FY12 FY13-FY15 FY16-FY17
Rounds Played 43,302 43,077 45,032 41,804
NOI $964,806 $761,089 $1,026,741 $740,128
Summary
All in all, MBGC has been a very consistent performer since its rebirth, with negative variations in
performance largely - or perhaps entirely - due to external factors. Rounds played have been in the range
desired by the City to preserve the asset and the golf experience, and the public policy of subsidizing
resident rates below `market rate', while constraining revenues, has allowed the majority of resident
golfers to enjoy this premier public golf offering.
National Golf Foundation Consulting, Inc. — City of Miami Beach — Miami Beach Golf Club — 16
Page 1264 of 1637
;(1; t' i ti; KSE (.(Y Dii
Below are NGF's key observations about golf course maintenance conditions at MBGC, based on facility
tour and discussions with the Superintendent:
► In total, MBGC includes about 120 acres of managed property (includes streetscapcs, which
were added to the golf course responsibilities and budget in 2017). As noted above, the total
golf course maintenance budget for FYI7 was $1.56 million, which is at the high-end of the
range public 18 -hole golf courses.
a All of the turfgrass at MBGC is Paspalum variety, a salt -tolerant grass that
nevertheless presents some maintenance challenges, especially with respect to greens,
which require a lot oftopdressing and "TLC' to regulate consistency and speed to
golfer desires.
• The irrigation source is City potable water (was formerly brackish water from ponds),
which cost the golf course 5178,000 in FY 17. The Toro irrigation system dates to
2000. Though there are no major problems (pumps have been repaired several times),
the City should begin planning for its replacement +10 years down the road.
• Maintenance equipment is obtained via a lease agreement (operating budget); it is a
full -fleet lease with 4 -year turnover, and equipment appeared to be in very good
condition during the NGF visit. (Golf carts are also on operating lease, with a 3 -year
cycle - new fleet due in December 2018).
• There are 53 total bunkers on the course, many of which need face work (ongoing
project done out of operating budget). Re -sodding of holes is underway & part of on-
going maintenance (also out of operating budget).
• The driving range features both mats and grass; mats are utilized M -Th and grass Fri -
Sun to preserve turf quality and conditions.
• Current Capital Plans: PCM is proposing new capital for practice area
enhancement (expanding the tee area), as well as range netting replacement.
NGF overall takeaway: Globally, NGF found MBGC to be in very good condition, befitting its price
point and golfer expectations of "country club for a day". This opinion is validated by the very strong
ratings that MBGC gamers through its Golf Outing Evaluation Forms, where `excellent' ratings are
generally in the 80% to 100% range (depending on golf course component and year), and not a single
rating was just `fair' or `poor' among 65+ responses over a 5 -year period.
National Golf Foundation Consulting, Inc — City of Miami Beach —Miami Beach Golf Club —17
Page 1265 of 1637
`t].S1-i=1Ct BUD ;kit
Miami Beach Golf Club staffing comprises personnel who fall on the City budget, as well as staff that
work in one of the concession areas (merchandising, food & beverage, golf school) who are compensated
by PCM. NCI' observations on MBGC staffing:
► The FYI7 total expenditures for labor and benefits were just over $1.5 million, including
$816,000 for the maintenance department (see previous section).
► Golf course maintenance staffing comprises 20 full-time positions:
• Key positions: Superintendent, Assistant Superintendent, Mechanic, Irrigation
Technician, Spray ifechnician.
• Operators (7) and Laborers (8).
► Management/Golf Operations is a mix of full-time and part-time employees:
• Shared Management (MBGC and Normandy Shores) includes General Manager
(PCM employee), Director of Golf, Director of Membership & Marketing, Controller
and Purchasing Assistant.
• Golf Operations—management/pro shop: Head Golf Professional, 1" Assistant Golf
Professional, Golf Shop Attendants (3), Merchandise Assistant (PCM employee).
• Golf Operations - outside services/other: Rangers (3 p/t), Starters (2 f/t), Cart
Attendants/ Bag staff (10, including —7 Pt).
► PCM compensates all employees associated with the pro shop and food & beverage
concessions, including the F&B Manager. PCM also compensates the City S2,000 per month
for City staff selling merchandise.
► MBGC staff does not provide lessons_ Jim McLean Golf School compensates all instnictors.
NCF observation regarding staffing and labor budget: MBGC staffing is robust, but very much in
line with what NGF has observed at other top tier public golf courses. MBGC staff is obviously well
trained and takes pride in its work. Staff has reportedly had very little turnover, and thus has significant
institutional knowledge with the property. As with golf course conditions, golfers have a level of
expectations with overall facility service that is commensurate with the high green fee charged. Overall,
this facility is providing a very high level of service, requiring a large employee "footprint" that is not
directly comparable to industry norms. Based on our review, NGF does not believe the budget could be
reduced without a corresponding reduction in service level or maintenance quality / condition.
31ARKF'LING / I HtLC I SELLING
MBGC spent a total of $8,200 on advertising and promotions in FYI7, not including other money spent
on dues and memberships (chamber of commerce, etc.). PCM also employs a full-time Director of
Membership and Marketing, with duties and compensation split between MBGC (60%) and NSGC
(40%). NGF observations on MBGC marketing and direct selling:
► In the past, NGF recommended about I% to 2% of total gross revenues as a benchmark for a
golf course marketing budget, which would equate to about $40,000 at MBGC at minimum.
However, in today's golf marketing world, much of the communication is through low- or
no -cost digital channels (website, email database marketing, social media, etc.), so NGF's
rough rule of thumb no longer applies.
National Golf Foundation Consulting, Inc. — City of Miami Beach— Miami Beach Golf Club — 18
Page 1266 of 1637
► Additionally, MBGC's marketing budget is effectively understated, as it employs a marketing
director who is active in direct sales, which NGF believes is the most important component of
a marketing program for a premier public golf facility in a destination market. The director of
membership and marketing reported spending about 25% of his time on direct selling for
groups and outings, and has cultivated an active concierge program with arca hotels and the
Miami Beach Convention Center. Both the DOM and other staff are also actively engaged in
public relations and direct selling to the rest of the community (more later in report).
NGF key findings on marketing and direct selling: Though the overall spend on advertising is low, it
is important to note that MBGC is very well established in the community and has a high level of
awareness among both south Florida residents and visitors, thus reducing the need for a robust marketing
budget. Also, the budget is effectively understated due to the importance of direct selling for a premier
public facility in a resort market with many lodging properties and a high-volume convention center.
Finally, MBGC has been performing with rounds activity levels at, or very close to, the target levels
established by the City Commission from the inception of the club.
CUSTOMER SERVICE
Though NGF did not implement its customer satisfaction program (Gol[SAT) at MBGC for this project,
we did review five years' worth of Golf Outing Evaluation Forms (see Appendix F for tables of summary
results) as a proxy for assessing overall golfer customer satisfaction at the facility. (We note that large
corporate and group outings contain many business people, including Fortune 500 clientele, with high
expectations and low tolerances for poor service or experience). NGF observations about MBGC
customer service:
► NGF consultants observed a high level of service from the moment we entered the premises,
starting with the cart attendant (even though we were not golfing), and including our lunch at
the restaurant. NGF was consistently greeted warmly by employees.
► Results of the outing evaluation forms from FY13 through FYI7 reveal ratings consistently —
80% to 95% `excellent' (varies somewhat by year) for the categories of `Outing
Administration', `Staff , and 'Food & Beverage'. For FY17, ratings across 8 measures within
these categories were all 100% excellent. Over the entire 5 -year period, only one reviewer out
of about 70 outings gave anything other than an excellent or good rating in these areas (was
for pre -outing communication).
W. The City employs periodic `secret shoppers' to monitor customer service at MBGC.
NGF key findings on customer service: Though maintaining an excellent customer service culture and
profile is important for all businesses, including golf courses, it is especially critical for a premier
municipal golf facility in a market with many golfing choices such as greater Miami. Bad experiences
reflect poorly on the City (golfers associate the golf course and employees directly with the City). The
key to successful customer service at a facility such as MBGC is managing the experience, and NGF
believes that the City and facility management have effectively achieved that objective, as borne out by
the consistent economic performance and measurement vehicles like the outing forms and secret shopper.
MERCHANDISE AND FOOD & BEVER kGE CONCESSIONS
As discussed earlier, merchandising, food & beverage (along with lessons/instruction) at MBGC arc
operated via concession agreements. Though NGF did only a cursory review of these concessions -
including dining for lunch at the restaurant - during our one -day visit, the various concessions appeared to
have strong customer service profiles. NOF observations about the pro shop and food & beverage
concessions at MBGC:
National Golf Foundation Consulting, Inc. — City of Miami Beach — Miami Beach Golf Club — 19
Page 1267 of 1637
► The pro shop, though relatively small, was amply stocked with a preponderance of soft
goods, shoes and apparel, including a lot of logocd merchandise—something NGF always
recommends for destination facilities with attractive and unique logos such as that at MBGC.
Pricing appeared to be commensurate with the price point and destination appeal of the
facility.
► The restaurant/bar, also relatively small in size, is nicely appointed and had a good mixture of
both golf and non -golf lunch customers during our visit. As per the City directive when the
clubhouse was initially programmed and designed, the meeting/banquet space is limited, with
a capacity of about 60. Between the meeting space and adjacent outdoor space, there is barely
sufficient capacity to accommodate a full field double shotgun outing of 144 players. The
restaurant, meeting room and outdoor patio together can accommodate a total of -230 people.
► The restaurant is open 7 days a week, for breakfast, lunch and dinner. It opens from 6:30 am
to 9:00 am for continental breakfast, and the kitchen opens at 9:00 am. The full -liquor bar is
open from 6:30 am until 8 pm. Saturday and Sunday mornings feature full service breakfast
service from 9 am until 2 put.
► The restaurant features a varied and extensive menu comprising brunch items, desserts,
salads, starters, burgers, and hot and cold specialty sandwiches and wraps. As with the pro
shop merchandise, pricing is commensurate with the Miami Beach tourist destination and the
price point of the golf course. (NGF often uses the price of a hamburger as a benchmark for
overall pricing; the `Miami Beach Burger' is $12.50).
NGF key findings on concessions: Though the clubhouse size at Miami Beach Golf Club is somewhat
limiting in terms of revenue maximization and customer service (e.g., facilitating large outings and
meetings), PCM appears to be doing a good job with both the pro shop and food & beverage concessions.
NGF believes that food & beverage operations located at golf courses should strive to cover their costs
and even make a profit, but their primary purpose is to serve golfers. Because private vendors have a
profit imperative, service to golfers can sometimes become secondary. This is not the case at MBGC,
where the vendor also happens to manage the entire golf facility for the City. The most important aspects
for serving golfers include providing space for golfers to feel comfortable being served in golf attire after
playing a round (hats, golf shoes, etc.), and providing rapid "walk-up" service for golfers still on the
course (MBGC has ahead service).
INS {RUCTION AND PROGRAMMING
Miami Beach GC offers a full menu of adult lessons, clinics, etc. through the Jim McLean Golf School. In
addition, PCM is very active with junior instruction, and MBGC is host to one of the premier amateur
golf events in the world.
Juniors
► PCM created a free junior golf program hosted at Normandy Shores Golf Club to introduce
children to the game that otherwise would not have the opportunity due to financial constraints.
The program began with support through a grant from the USGA, and over the years the
program has grown. Now with grant support from the FJGC and the fundraising Billy Shockett
Memorial Golf Tournament, there are 2 free clinics each week during the school year, taught by
PGA professionals.
► The City has also made an effort to grow the game by providing a $5.00 junior rate to walk
after 2:00 at Normandy Shores, and through funds raised at the Billy Shockett Memorial
Tournament US Kids tees were added so that children of all ages and abilities can play from the
appropriate yardage.
National Golf Foundation Consulting, Inc.— City of Miami Beach — Miami Beach Golf Club —20
Page 1268 of 1637
► Weekly junior clinics at Normandy Shores are held on Saturday mornings and at Miami Beach
Golf Club on Tuesday, Wednesday, Thursday and Saturdays with the Jim Mclean Golf School.
During summer there is a full schedule of weeklong camps at both facilities, capped off with
the Miami Beach Junior Open.
South Beach International Amateur Tournament
The South Beach International Amateur Tournament has enjoyed a consistent place the top of the world's
rankings for amateur tournaments, and was considered a "major" international event for the 6th straight
year. Highlights for the 2017 South Beach International Amateur — held December 17 through 22 -
include (source: PCM):
► Again earned "A" status from the Royal & Ancient Golf Club of St. Andrews, one of golfs
two governing bodies, for its continued "major" status, and reaching the 5th spot in the
worldwide amateur rankings.
► Remained the #4 ranked amateur tournament in the nation behind the United States Amateur,
Western Amateur and NCAA Division 1 Championship.
► Was again sold out and attracted 210 of the top amateurs in the world with a wait list that
consisted of over 150 players.
► The tournament featured the highest number of international amateurs (102) of any amateur
tournament in North America and was second only to the British Amateur worldwide.
► More than 1,000 hotel room nights were sold to participants and guests.
► Attracted approximately 450 parents, coaches and contestants to Miami Beach for an average
of 5 days. Based on visitor spending average figures from the Miami Beach Chamber of
Commerce (at $269 per day, represented a $671 K financial impact to the City).
NGF observation: Through both the Jim McLean Golf School and their own staff at both MBGC and
NSGC, PCM is very active with adult and junior instruction, and the South Beach International Amateur
Tournament has a large positive impact on both MBGC and the community.
( O;\I\it \ITV USG ;\GI,:Mrs 'F
For a municipal golf course, community engagement is both necessary and helpful to maximizing activity
and support from residents and businesses. NGF observations about PCM's level of community
engagement:
► PCM reported spending many hours every year attending community meetings (e.g., chamber
of commerce), getting feedback from constituents, ete. As noted earlier, golf course staff is
very active in engaging local hotels and the convention center to direct players to MBGC.
► MBGC and NSGC staff goes out to the community to teach the game to children, conducting
6 -week sessions at the Scott Rakow, Flamingo Park and North Shore Park Youth Centers. At
the conclusion of these sessions, through the grant from the FIGC, each facility received a
donated SNAG Coaching Kit so that the counselors can continue to teach golf to the children.
► Staff also conducts a week -tong complimentary summer camp in conjunction with Miami
Beach Parks & Recreation summer programs.
NGF observation: After more than 15 years at MBGC and Normandy Shores, PCM seems to have
established many relationships and appears to be deeply entrenched in the community.
National Golf Foundation Consulting, Inc. — City of Miami Beach —Miami Beach Golf Club — 21
Page 1269 of 1637
RI-'.('.(112I)1C1'EI'IN(: / It IiI'OItfl N(:
Though NGF has found through its experience that lack of financial responsibility at golf courses is
uncommon, municipalities that entrust their golf operations to a private operator run the risk of either
substandard recordkeeping and/or 'creative accounting'. Therefore, it is very important to have point-of-
sale and reporting systems in place that ensure that oversight at the municipal level is seamless, and that
records and data provided to the City are accurate, easy to understand and informative. NGF observations
about recordkeeping and reporting at MBGC, based on information supplied to us for this engagement:
► PCM is required to submit daily audits to the City.
► PCM, working with the City, prepares annual budgets, capital plans.
► Internal reporting, such as the Monthly Progress Reports, is well organized, easy to
understand and clearly show year -over -year performance trends in rounds and revenues.
NGF key findings on recordkeeping and reporting: NGF was not retained to do an audit of systems
and reporting at MBGC. However, we have done hundreds of operations reviews and have found the
reporting and recordkeeping at MBGC to be among the most organized, concise and useful that we've
come across. Additionally, when we made requests for documentation during the course of our study, the
data and information was readily available and quickly sent to us.
National Golf Foundation Consulting, Inc. — City of Miami Beach — Miami Beach Golf Club — 22
Page 1270 of 1637
Summary Statement
Miami Beach Golf Club is an historic and valued community amenity that underwent a renaissance with
its early 2000s renovation. With the reinvention of the old Bayshore Golf Course, the City established
clear cut goals with respect to asset stewardship and operating parameters of the club, with a focus on
providing a top quality golf experience to all players. while preserving affordable playing fees for Miami
Beach and south Florida residents.
NGF's summary business analysis of MBGC and its management has revealed a very high quality
product that benefits from a management team with many years' of experience navigating the nuances of
public golf in south Florida. As noted in the report, MBGC has had remarkably consistent performance
since at least the FY 2005 period (time frame for which NGF had operating results). And during those
periods when demand and net operating income were lower, the declines were largely attributable to
external uncontrollable factors, such as the financial crisis of 2008-09, as well as the convention center
construction, Zika virus and Hurricane Irma over the last few years.
We note that operating a high-end municipal golf course with established public policy goals can be a
difficult balancing act. For example, at MBGC management must juggle the needs of several different
user groups, including city residents, tourists, members, and groups, each wanting to play this premier
golf course during their preferred playing times. Another challenge with respect to golf operations in
south Florida is trying to equalize activity levels during the year, in the face of extreme seasonality of
demand. PCM has effectively done this by cultivating the facility's annual membership and Premier Card
programs.
NGF Consulting's principals have visited and analyzed hundreds of municipal and daily fee golf
operations over the last three decades. Our overriding finding from our tour and summary business
analysis is that MBGC is one of the top municipal golf operations in the country, with an outstanding,
very well maintained golf course and net operating income performance that places the facility in the top
2% of municipal golf facilities in the U.S., even considering the revenue constraint resulting from resident
green fees that are well below `market' rates.
NGF's independent review and analysis revealed no obvious weaknesses, with best business practices
adhered to in all of the aspects of the operation that we observed. One area that requires some fine tuning
is the establishment of the annual revenue budget, which was increased by about 10% in FYI5. The
significant increase in the budget, combined with lower than expected revenues in the face of external
factors noted above, has resulted in large negative variances between actual and budgeted revenue over
the last fiscal several years.
In summary, while our analysis was based on a somewhat limited scope, NGF Consulting concludes that
Professional Course Management is doing an excellent job of managing the experience at the premier
"country club for a day" facility that Miami Beach Golf Club represents. Entrusted with a top flight golf
facility, PCM appears to have been a very good steward of the City's asset, while at the same time
actively engaging the community and accomplishing the public policy goals established by the City with
the reinvention of the club in 2002.
National Golf Foundation Consulting, Inc. — City of Miami Beach —Miami Beach Golf Club — 23
Page 1271 of 1637
Appendices
APPENDIX A N:)I tOA 11 ROI vUS I'L a) ED REPORT
APPENDIX LU('AL 1) NOG I PI MIC, DEM .\ ND, 1N0 Si. PI'LY
APPENDIX—itl. (;10ki )II AI( l 1' NI, (Mit 13EN(H\I\HKING
APPENDIX D— MIAMI BEACH GC I FF C11412
APPENDIX E -4I AJII BE NI G(: OPFIRATI'G PERFORMANCE IAMBI IS
APPENDIXF — )11A MI BEACH(,( 01:71N(, Il 41.1 1IOAS
National Golf Foundation Consulting, Inc — City of Miami Beach -Miami Beach Golf Club -24
Page 1272 of 1637
IO\AL, 120 L'\DS I'L:11 ED 14 EP01tT
APPENDIX A - NA
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of Miami Beach - Miami Beach Golf Club - 26
PH. VDLL IS I Ii1C. Il ,A ,A\D, i;AD St'.
Local Demographics and Demand
r-
Miami Beach Golf Course
IO -mile 15 -mile Broward Miami -
ring ring County Dade
County
U.S.
Summary Demographics
Population 1990 Census 843,753 1,560,870 1,255,215 1936.985 248,584,652
Population 2000 Census 883,483 1,732,334 1,622,997 2,253,397 281,399,034
CA(ad 1990.2000 0.46% 1.05% 2.00% 1 524, 1 25%
Population 2010 Census 932,433 1,837,437 1.748,066 2,496,435 308,745,538
CAGR 2000-22010 0.54% 0.59% 0.75% 103% 0.93%
Population Estimate 2017 1,024,927 2,001,551 1,931,908 2,727,606 324,310,011
Population 2022 Projected 1,088.678 2,117,598 2,080,678 2,876,016 337,744,388
CAGB 2017-2022 1211 113% l49% 1.07% 0.82%
C1GR 2010-20222 1.30% 1.19% 1.46% 1.19% 0.82° -
Median HH Income (2017) $39,875 $44,102 $56,960 $47,705 $59,240
Median Age (2017) 40.5 40.7 $40 $40 38.1
Ethnicity
White 65.7% 68.8% 59.9% 718 0 70.4%
African American 26.1% 235% 29.3 % 18.6% 13.3%
Asian 1.6% 1.7% 3.9% 1.9% 5,7%
All Other 6.6% 59% 6.9% 5.8% 10.6%
Hispanic Population
Hispanic 58.4% 60.6% 28.0% 66.8% 175%
Not Hispanic 41.6% 39.4% 72.0% 33.2% 825%
CAGR = Compound Annual Gnnnh Rate
National Golf Fouun�e1n 275ofig.I c. City of Miami Beach — Miami Beach Golf Club — 27
Golf Supply
Miami Beach Golf Course
10 -mile 15 -mile Broward
ring ring County
Miami -
Dade U S.
County
Golf Demand Indicators
'Forel Households 399,209 739,757 734,888 945,276 124,506,607
Number of Golfing Household 37,581 79,554 100,881 107,908 17,069,440
Projected Golfing Households (2022) 38,692 82,335 104,127 111,840 17,934,830
Projected Annual Growth Rate 060% 0.70% 0.60% 0.70% 1.00%
Seasonal Golfing l louseholds 3,830 6,190 6,691 5,137 732,421
Latent Demand/Interested Non -Golfers 159,751 283,846 285,794 348,815 40,573,960
Household Participation Rate 9.40% 10.80% 13.70% 11.40% 13.70%
Number of Golfers 54,534 118,438 144,812 169,775 23,815,640
Rounds Potential (resident golfers) 1,094,890 2,215,515 2,718,467 2,820,102 468,634,000
Estimated Course Rounds (in -market supply) 513,239 1,094,203 2,112,5522 1,222,426 468,634,000
Demand hidices
Golfing Household Participation Rate 68 78 100 83 100
Seasonal Golfing Households 163 142 155 92 100
Latent Demand/Interested Non -Golfers 124 113 118 102 100
Round Potential per Household (resident golfers) 75 82 101 81 100
National Golf Foundation
1276 ofing Inc, City of Miami Beach - Miami Beach Golf Club - 28
Supply -Demand
Miami Beach Golf Course
10 -mile I5 -mile Broward
ring ring County
Miami -
Dade
County
U.S.
Supply -Demand Ratios
Households per 18 Holes
Fetal 38,020 30,194 14.410 34,374 8,802
Public 49,901 41,098 20,701 45,013 12,063
Public: Daily Fee 399,209 105,680 31,272 90,026 15.541
Public: Municipal 57,030 67,251 61,241 90,026 53,911
Private 159,684 113,809 47,412 145,427 32,559
Premium (>$70) 66,535 73,976 63,903 94.528 73,913
Standard ($40-$70) 399,209 105,680 34,181 99,503 28,881
Value (<$40) 399,209 739,757 293,955 630,184 28.784
Golfing Households per 18 Holes
Total 3,579 3,247 1,978 3,924 1,207
Public 4,698 4,420 2,842 5,138 1,654
Public: Daily Fcc 37.581 11,365 4,293 10,277 2,131
Public: Municipal 5.369 7,232 8,407 10,277 7,39'
Private 15.032 12,239 6,508 16,601 4,464
Pretnium (>$70) 6,264 7,955 8,772 10,791 10,133
Standard ($40-870) 37,581 11,365 4,692 11,359 3,960
Value (4440) 37,581 79,554 40,352 71,939 3,946
Household Indices
Total 424 337 161 384 100
Public 404 333 168 364 100
Private 489 349 145 446 100
Pretnium (>$70) 90 100 87 128 100
Standard ($40-$70) 1,396 369 120 348 100
Value (<$40) 1.295 2,400 954 2,044 100
Golfing Household Indices
Total 290 263 160 317 100
Public 276 259 167 30/ 100
Private 334 272 145 369 100
Premium (>$70) 62 78 86 106 100
Standard ($40-$70) 952 288 119 288 100
Value (<$40) 884 1,871 949 1,692 100
Rounds per 18 Holes
Rounds Potential (resident golfers) 104,275 90,429 53,303 102,549 33,131
Estimated Course Rounds (in -market supply) 48,880 44,661 41,423 44,452 32,927
National Golf Foundation Consulting Inc. - City of Miami Beach - Miami Beach Golf Club - 29
Page 1277 of
APPENDIX C -REGION \L ML NICIPAL. GOLF REM -HMA
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$3,181,158
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Peak Slimmer
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Fee
Peak Winter
Green + Cart
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2016
Management Total
Structure Rounds
Played
S -O 40,448
S-0+ FB J 42,664
rn
MC+FB+PS 42,683
MC+FB+PS j 31,554
36H R S-0+FB 59,146
18H S-O+FB 39,783
I8HR MC+FB+PS i 43,613
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Miami Beach Golf Club
Normandy Shores Golf Course
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Page 1278 of 1637
v'I'END! X 1) 14,1. CI .11CF
Shoulder Season
11/1/2017-12/15/17
Peak Season
12/16/2018-4/30/18
Summer Season
5/1/2018-10/31/18
Miami Beach Golf Course - 2017-2018 Golf Rates
Regular Rates South Florida Residents Miami Beach Residents
$130 $100 $60
5225 5120 S80
$120 $80 Weekdays $45 Weekdays
595 Weekends $60 Weekends
Miami Beach Golf Course - 2017-2018 Membership Rates
Resident Non -Residents
Single Golf $3,500 S5,500
Husband & Wife or Domestic Partners $4,500 $7,000
Each Dependent (under 18 years of age) 5450 $700
Member Cart is an additional $20, plus tax (per round)
Bag storage is included with membership; Lockers are $175 per year, plus tax
National Golf Foundation Consulting
Inc. —
City of Miami Beach — Miami Beach Golf Club — 31
i
Vail IIVVIIV I XI(IX:IdiV
Exhibit 1: Rounds History
Miami Beach Golf Club - Rounds History
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Exhibit 2: Operating Revenue - City Perspective
Nliami Beach Golf Club - Operating Revenue (FY13 - FY17 - City Perspective)
Golf Revenue
FY2013
FY2014
FY2015
FY 2016
FY 2017
Greens Fees
SI ,992,544
52,051,322
52,166,576
51,957,495
51,776,782
Cart Fees
1,081,367
1,130,889
1,009,768
1,005,998
952,583
Membership @ 1/6
587,229
567,627
574,373
587,224
630,341
Sub -Total Golf Revenue
$3,661,140
$3,749,838
$3,750,717
$3,550,717
$3,359,706
Other Revenue
$3,749,838
$3,750,717
$3,550,717
$3,359,706
Other Revenue
Range
$181,204
5180,538
5163,780
5169,454
5159,425
Lessons @ 20%
70,530
88,315
65,131
107,009
143,493
Pro Shop Lease @ 5%
41,462
44,418
41,642
38,295
35,777
Miscellaneous-
888,360
-
-
466,960
Miscellaneous
Food & Bev Lease @ 5%
44,463
47,545
47,734
51,969
50,483
Sub -Total Other Revenue
5337,659
$360,816
$318,287
$366,727
$389,178
Totals
53,998,799
54,110,654
54,069,004
53,917,444
53,748,884
Exhibit 3: Operating Revenue -Facility Perspective
Miami Beach Golf Club - Operating Revenue (FY13 - FY17 - Facility Perspective)
Golf Revenue
FY2013
FY2014
FY2015
FY 2016
FY 2017
1
Greens Fees
51,992,544
52,051,322
52,166,576
51,957,495
$1,776,782
Cart Fees
1,081,367
1,130,889
1,009,768
1,005,998
952,583
Membership @ 1/6
587,229
567,627
574,373
587,224
630,341
Sub -Total Golf Revenue
$3,661,140
$3,749,838
$3,750,717
$3,550,717
$3,359,706
Other Revenue
Range
5181,204
5180,538
5163,780
5169,454
5159,425
Lessons
352,650
441,575
325,655
535,045
504,085
Pro Shop
829,240
888,360
832,840
765,900
466,960
Miscellaneous
-
-
-
Food & Bev
889,260
950,900
954,680
1,039,380
624,260
Total Other Revenue
$2,252,354
$2,461,373
$2,276,955
$2,509,779
$1,754,730
Totals
55,913,494
56,211,211
56,027,672
56,060,496
55,114,436
National Golf Foundation Consulting.,Ine. - City of Miami Beach - Miami Beach Golf Club - 33
Page 1281 of 1837
Exhibit 4: Operating Revenue per Round - City Perspective
MBGC - Operating Revenue per Round (FYI3 - FYI7 - City Perspective)
Oct 2017 -
Golf Fee Revenue
FY2013
FY2014
FY2015
FV2016
FV2017
April 2018
Rounds
44,883
47,175
43,039
42,683
40,924
26,315
Golf Fee Revenue
S3,661,140
53,749,838
53,750,717
$3,550,717
$3,359,706
52,432,355
rate
$81.57
$7949
$87.15
$83.19
$82.10
$92.43
rAverage
Oct 2017 -
Other Revenue
FY2013
FY2014
FY2015
FY2016
FY2017
April 2018
Range
5181,204
5180,538
5163,780
$169,454
5159,425
5104,653
Lessons @ 20%
70,530
88,315
65,131
107,009
143,493
92,087
Pro Shop Lease @ 5%
41,462
44,418
41,642
38,295
35,777
26,066
Miscellaneous
_
_
_
-
Food & Bev Lease @ 5%
44,463
47,545
47,734
51,969
50,483
34,041
Total Other Revenue
5337,659
5360,816
5318,287
5366,727
5389,178
5256,847
Other Revenue per
Oct 2017 -
Round
FY2013
FY2014
FY2015
FY2016
FY2017
A s ril 2018
Rounds
44,883
47,175
43,039
42,683
40,924
26,315
Range
$4.04
$3.83
$3.81
$3.97
S3.90
$3.98
Lessons @ 20%
1.57
1.87
1.51
2.51
3.51
3.50
Pro Shop Lease @ 5%
0.92
0.94
0.97
0.90
0.87
0.99
Miscellaneous
-
-
-
-
-
Food & Bev Lease @ 5%
0.99
1.01
1.11
1.22
1.23
1.29
Total Revenue per Round
$7.52
$7.65
$7.40
$8.59
$9.51
59.76
Total Revenue
53,998,799
54,110,654
54,069,004
53,917,444
53,748,884
52,689,202
Total Revenue per Round
589.09
$87.14
$94.54
$91.78
$91.61
5102.19
National Golf Foundation Consulting Inc. - City of Miami Beach - Miami Beach Golf Club - 34
Page 1282 of I67
Exhibit 5: Operating Revenue per Round- Facility Perspective
MBGC-Operating Revenue per Round(FY13-FY17- Facility Perspective)
FY2013 FY2014 FY2015 FY 2016 FY 2017
Golf Revenue
Rounds 44,883 47,175 43,039 42,683 40,924 i
Greens Fees 3,661,140 $3,749,838 $3,750,717 $3,550,717 $3,359,706
Average rate 581.57 $79.49 $87.15 $83.19 $82.10
Other Revenue FY2013 FY2014FY2015 FY2016 FY2017
Range $181,204 $180,538 $163,780 $169,454 $159,425
Lessons 352,650 441,575 325,655 535,045 504,085
Pro Shop Lease 829,240 888,360 832,840 765,900 466,960
Miscellaneous
Food & Bev Lease 889,260 950,900 954,680 1,039,380 624,260
Total Other Revenue $2,252,354 $2,461,373 $2,276,955 $2,509,779 $1,754,730
Other Revenue per Round FY2013 FY2014 FY2015 FY2016 FY2017
Rounds 44,883 47,175 43,039 42,683 40,924
Range $4.04 $3.83 $3.81 $3.97 $3.90
Lessons 7.86 9.36 7.57 12.54 12.32
Pro Shop Lease 18.48 18.83 19.35 17.94 11.41
Miscellaneous - - - - -
Food& Bev Lease 19.81 20.16 22.18 24.35 15.25
Total Other Rev. per Rd. $50.18 $52.18 $52.90 $58.80 $42.88
Total Revenue $5,913,494 $6,211,211 $6,027,672 $6,060,496 $5,114,436
Total Revenue per Round $131.75 $131.66 $140.05 $141.99 $124.97
National Golf Fou 9 128nsuulting,3I c.-City of Miami Beach-Miami Beach Golf Club-35
Exhibit 6: Summary Performance—City Perspective
Miami Beach Golf Club-Summary Performance(City Perspective)FY 2005 -FY 2017
FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
Rounds Played 42,923 42,905 44,078 41,879 43,358 42,426 45,437
i Golf Fee Revenue $3,791,830 53,867,221 54,010,138 $3,911,610 $3,524,289 $3,405,779 $3,562,581
Golf Fee Rev. per Round $88.34 $90.13 $90.98 $93.40 $81.28 $80.28 $78.41
Total Operating Revenue $4,004,154 $4,113,632 $4,272,083 $4,222,222 $3,836,118 $3,599,142 $3,893,173
Total Rev. per Round $93.29 $95.88 $96.92 $100.82 $88.48 $84.83 $85.68
Operating Expense 53,059,585 $3,151,311 $3,284,554 $3,416,517 $3,163,173 $2,925,128 $2,993,999
Net Operating Income $944,569 $962,321 $987,529 $805,705 $672,945 $674,014 $899,174
FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Average
Rounds Played 42,283 44,883 47,175 43,039 42,683 40,924 43,287
Golf Fee Revenue $3,331,293 $3,655,556 $3,750,182 $3,742,259 $3,542,456 $3,358,697 $3,724,778
Golf Fee Rev. per Round $78.79 $81.45 $79.50 $86.95 $82.99 $82.07 $86.12
Total Operating Revenue $3,635,164 $4,001,657 $4,110,654 $4,061,494 $3,908,702 $3,747,875 $3,991,503
Total Rev.per Round $85.97 $89.16 $87.14 $94.37 $91.58 $91.58 $92.27
Operating Expense $2,881,759 $2,916,366 $3,066,991 $3,110,224 $3,084,712 53,091,610 $3,142,038
Net Operating Income $753,405 $1,085,291 $1,043,663 5951,270 $823,990 $656,265 $849,465 I
National Golf Founndaati 1284 ul ing I o.—City of Miami Beach—Miami Beach Golf Club-36
Exhibit 7: Profit Loss Yearly Comparison
Miami Beach Golf Club-Profit& Loss Yearly Comparison
Oct 2017-
FY2013 FY2014 FY2015 FY2016 FY2017 Anil 2018
Actual $3,998,799 $4,110,654 $4,069,004 $3,917,444 $3,748,884 S2,689,202
Budget $4,028,000 $3,956,000 $4,337,000 $4,350,000 $4,163,000 $2,641,391
Variance ($29,201) $154,654 (5267,996) (5132,556) ($414,116) $47,811
National Golf Foundatioon�CConsu85 ting,inc.—City of Miami Beach—Miami Beach Golf Club-37
VITENDiN. L l!J AM! 1W `.i U GC;S.F 01 I INC F. ALt ATIONS
Golf Outing Evaluations
2013 2014
Ratings Excellent Good Fair Poor Total Ratings Excellent Good Fair Poor
Golf Course Conditions
Tees 14 92.9% 7.1% 14 71.4% 28.6%
Fairways 14 78.6% 21.4% 14 78.6% 21.4%
Traps 14 85.7% 14.3% 14 78.6% 21.4%
Greens 14 85.7% 7.1% 7.1% 14 85.7% 14.3%
Clubhouse
Entrance 14 71.4% 28.6% 14 78.6% 14.3% 7.1%
Pro Shop 14 71.4% 28.6% 14 71.4% 28.6%
Outing Administration
Pre-Outing Communications 14 92.9% 7.1% 14 85.7% 14.3%
Organization 14 92.9% 7.1% 13 92.3% 7.7%
Bag Handling 14 92.9% 7.1% 13 100.0%
Specials Events 13 92.3% 7.7% 12 91.7% 8.3%
Post Event Scoring 10 90.0% 10.0% 12 100.0%
Staff
Appearance 13 92.3% 7.7% 14 85.7% 14.3%
Courteous 13 92.3% 7.7% 14 92.9% 7.1%
Helpful 13 92.3% 7.7% 14 92.9% 7.1%
Food&Beverage
On Course Beverage Service 14 85.7% 14.3% 14 85.7% 143%
Buffet 9 88.9% 11.1% 10 80.0% 20.0%
Service Staff 13 92.9% 7.1% 13 92.3% 7.7%
National Golf Foundation Consulting,Inc -City of Miami Beach-Miami Beach Golf Club-38
Page 1286 of 1637
1 2015 2016 •
2017
•
Total Total Total
'Ratings Excellent Good Fair Poor l Ratings Excellent Good Fair Poor Ratings Excellent Good Fair Poor
__.i.
Golf Course Conditions
Tees 17 82.4% 17.6% II 81.8% 18.2% 15 100.0%
Fairways 17 82.4% 17.6% II 81.8% 18.2% I 15 93.3% 6.7%
i
Traps 18 72.2% 27.8% , II 81.8% 18.2% , 15 93.3% 6.7%
Greens 17 82.4% 17.6% 1 1I 81.8% 18.2% 15 86.7% 113%
Clubhouse
Entrance 17 70.6% 12 75.0% 16.7% 8.3% 15 93.3% 6.7%
Pro Shop 17 82.3% 11.8% 5.9% 12 75.0% 16.7% 8.3% 14 100.0%
Outing Administration
Pre-Outing Communications 17 73.5% 23.5% ' 12 83.3% 8.3% 8.3%i 14 100.0%
Organization 17 88.2% 11.8% 12 83.3% 16.7% 14 100.0%
i
Bag Handling 16 81.2% 18.8% 12 83.3% 16.7% 15 100.0%
Specials Events 14 786% 21.4% II 81.8% 18.2% 1 12 100.0%
Post Event Scoring 14 92.9% 7.1% II 90.9% 9.1% ' 13 100.0%
Staff
Appearance 17 94.1% 5.9% II 90.9% 9.1% 15 100.0%
Courteous 17 94.1% 5.9% 12 100.0% 15 100.0%
Helpful 17 94.1% 5.9% II 90.9% 9.1% 15 100.0%
Food&Beverage
On Course Beverage Service 15 800% 13.3% 6.7% 12 83.3% 16.7% 13 84.6% 15.4%
Buffet 9 88.9% 11.1% 8 75.0% 25.0% 9 100.0%
Service Staff 16 812% 6.3% 12.5% 10 80.0% 20.0% I 13 100.0%
National Golf Foundation Consulting,Inc.-Cty of Miami Reach-Miami Beach Golf Club-39
Page 1287 f 1637