The Pellucid Perspective - July 2017 - 14

MARKET FOCUS

Orlando no magic
kingdom for operators

Orlando-Kissimmee, FL Core Business
Statistical Area (CBSA)

or our new readers, in this section we profile one of the Top
25 US Golf Markets (based on a composite score of the
golfer base, the supply level and rounds demand). Within
that Top 25 universe, we then rank them based on relative health
using a Pellucid weighted scoring system on 8 variables ranging
from Population Growth to Estimated Profitability. In this issue,
we'll profile the #3 healthiest market, the Orlando-Kissimmee
Metro Core Business Statistical Area (CBSA). For those of us in
the industry, we know Orlando as the PGA Merchandise Show
Mecca to which we trek annually for new equipment revelations,
some attempt at education and to see what fun, futuristic and
often wacky ideas will be on the trade show floor. For golfers it's a
pleasant winter escape and a place where family fun and golf can
mix. The key question though, behind its Magic Kingdom-like
veneer, is whether it's a friendly or hostile environment to run a
successful golf operation.
By rounds demand (one of our 3 selection criteria for initial
inclusion in the Top 25 list), Orlando ranks 18th among US
markets with facility-reported annual demand of just under 4M
rounds. (That facility-reported tally counts both local and tourist
play which, in this case, is significant). Looking at the golf consumer base, we see that Orlando is home to a relatively small local
golfer base of roughly 186K golfers (this is only local, resident
population, doesn't count the tourism or snowbird crowd). That
golfer base is served by a relatively healthy amount of supply of
106 18-hole equivalent (EHE) facilities, producing an average
ratio of 2K local resident golfers per EHE, just above the national
average, which isn't bad given that it's been developed on its destination vs. local market characteristics.
The supply mix vs. the national distribution across Pellucid's
five access/value/usage segments shows a strong primary bias to
Public-Premium at 36% of total holes compared to the national
average of 23%. Also of interest is a healthy presence of Public-Price to somewhat counterbalance that at 18% of supply vs.
the national average of 16%. The balance of Value-added golf
supply (Private & Public Premium) vs. Value golf (Public Value,
Price and Learning & Practice) is 54%/46% vs. the national average of 50%/50%, meaning that the market skews only slightly
more to Value-added than the national average. (This is muted
by the relatively low incidence of Private vs. the national average). Within Public-Regulation golf, the distribution between
Premium/Value/Price is 47%/29%/24% vs. the national picture
of 34%/42%/24%, which highlights the meaningful skew within
that universe to Value-added golf after we exclude the Private
and Learning & Practice supply from the equation.
During the "go-go" years of supply development (1990-2000),
the Orlando CBSA was a leader in the "build a course a day"
craze (annual (unsustainable) supply growth of ~2%) by adding

14 The Pellucid PersPecTive

Private

PublicPremium

PublicValue

Golfer Base
- Est. # of Golfers (Ks)
- # of 18 Hole Equivalent Facilities
- Golfers per 18-Hole Equiv.

PublicPrice

Learning
& Practice

Orlando, FL
CBSA

Supply Mix
- Private
- Pub-Prem
- Pub-Val
- Pub-Price
- Learn & Prac

Tot US

Index
vs. US

186.1 23,400
106 14,672
1,764 1,595

111

19%
36%
22%
18%
5%

27%
23%
28%
16%
6%

70
157
79
113
83

21%
23%

9%
-12%

229
N/A

-21%

N/A

33.4

33.8

44%
56%
$1,061.3 $1,155
$14
$19

79
92
74

Supply/Demand Balance
- '00-'13 Cume Supply Growth/Decline*
- '00-'13 Cume Rds Demand Growth/
Decline*
- '00-'13 Cume Mkt Supply Dilution
(-)/Absorption (+) Level* **
- Avg Ann Rds Velocity (Ks per 18-hole
vs. ks) (EHE)
Rounds & GF Revenue Health
- % Utilization Rate
- Avg. Ann. Rev. per Public
Regulation EHE ($Ks)
- Revenue per Available Round
(RevpAR)

Future
Facility

* Inverse index, lower is better
** Period % Chng in Rds vs. Period % Chng in Supply

Above average level vs. US (Index >105)
Average level vs. US (Index 95-104)
Below average level vs. US (Index <95)

holes at a Compound Annual Growth Rate (CAGR) of nearly
4%. They weren't as crazy as one would think though as annual
population growth trailed that only slightly (~3) meaning, theoretically, they entered the new century with relatively low supply
dilution (~7%) relative to the 1990 benchmark. Since 2000, the
rate of supply growth has throttled back (not as much though
as the national dropoff ) while population growth has moderated
July 2017

Table of Contents for the Digital Edition of The Pellucid Perspective - July 2017