The Pellucid Perspective - April 2012 - (Page 7)

GOLF COURSE DEVELOPMENT Military base redevelopment puts golf in limbo In “Man Bites Dog” twist, no bidders surface for new course design and construction By Jim Koppenhaver I n an ironic golf industry advisory that might be labeled “Don’t Build a Course at All” that’s playing out in many U.S. markets, Chicago’s Lake County Forest Preserve District (LCFPD) commissioners have recommended against developing a golf course. How’s that ironic? Because, as a result, they now find themselves under attack by the Fort Sheridan residents and the Cities of Highland Park and Highwood to compel them to move forward on what would prove to be an incredibly risky golf gamble for Lake County taxpayers. Let’s rewind the video of history back to the early 1990s. I had the opportunity to play the Fort Sheridan course several times while the base was still active as a guest of a retired military friend. What I remember about the course is that it was typical of “muni golf ” — relatively bare bones but inexpensive, and with some interesting holes winding through the military base landscape. There were the out-and-back holes on the old parade ground and the Par 3 hole next to the inactive airstrip and having your round interrupted occasionally by the playing of Taps and retiring the colors at sunset. With the federal decision to close non-strategic bases in the early 1990s, Fort Sheridan was prepared to be decommissioned and the property repurposed. This is where the real story begins. According to recently-published documents by the LCFPD, here’s a brief chronology of the sequence and timing of events post-base closure: • 1993 – Base closes, golf course turned over to LCFPD for operation. • 1994-2003 – LCFPD operates course as a public golf facility. • October 2003 – LCFPD makes decision to close course due to eroding conditions and preparation for course redevelopment; architect hired for master plan and 18-hole golf course. • 2004 – Bids for golf course come in at $19M, $5M above LCFPD target budget (oops). This is coupled with a deteriorating Chicago golf market in rounds and revenue (double oops). • 2005-2008 – Legal issues with developers of Fort Sheridan residential complex regarding dirt removal and remediation of exposed and unexposed ordnance. In the meantime, development of non-golf amenities and facilities on the property continue (i.e. trails, beach access, ravine stabilization, cemetery beautification, etc.). • 2009 – Alternate options for golf course considered (i.e. “value” vs. “signature” architect, 9 holes vs. 18, lower maintenance turf options, etc.). LCFPD considers re-bidding 18 hole plan but chooses instead to appoint an Advisory Committee. • 2010-2011 – Compromise plan reached between the majority of interested parties for a 9-hole facility which delivers promised golf course but at lower budget and smaller footprint. Exploratory efforts for interested parties in developing 9 hole facility draw no interested parties. (That’s saying something in the current industry dearth of development projects and work). The crux of the “rub” in this story is twofold. One, in the transfer deed from the Federal Government to LCFPD (golf course and public recreation/historical areas) and the private land developers (surrounding land which was sold to the benefit of the government), there’s one of those little, seemingly simple, deed restrictions which make lawyers salivate: “the Property shall be a golf course and recreational open space in perpetuity and not devoted to another use, all in accordance with the Fort Sheridan Joint Planning Commission Concept Plan, dated September 30, 1994.” It would seem that the intent of this restriction was to preserve both public access and green space P E L LU C I D I S M Every round of golf has a cost to produce. There is no such thing as an “excess round.” Quantifying the cost of a round of golf is slightly more complicated but the simplest way is to take the annual basic maintenance cost and divide it by the number of Capacity Rounds. For many courses that figure falls in the $10-$20 range which means that if you’re discounting at that level or below you’re selling “below cost” (related theorem, you can’t make up in volume the per unit loss incurred by selling below cost). Similarly, establishing the cost of a round of golf enables you to value and determine who’s winning in barter relationships, you or the service provider. Finally, establishing the cost of a round of golf provides a foundation for better valuing “comp rounds” (provide at cost, don’t lose money on them?). www.PellucidcorP.com The Pellucid PersPecTive 7 http://WWW.PELLUCIDCORP.COM

Table of Contents for the Digital Edition of The Pellucid Perspective - April 2012

The Pellucid Perspective - April 2012
Contents
Golf associations seeking new ways to stem membership decline
Are you the master of your domain?
Military base redevelopment puts golf in limbo
iPad + cloud = simpler, cheaper golf operating system?
March weather impact: Nature’s baffling benevolence continues!
Fore, right! Who’s to blame?
Detroit market holding its own
Course purchase opportunities abounding on Florida’s ‘First Coast’
An uncluttered mind yields Masterful performance

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