The Pellucid Perspective - August 2012 - (Page 13)

MARKET FOCUS Sacramento golf (somewhat) better off than California finances Market Focus: Sacramento, CA Core Statistical Business Area (CSBA) H aving completed the rotation of the Top 25 US Golf Markets by number of golfers last month, we’ll branch out into other high-value markets until we’re ready with the updates to the Top 25, factoring in the 2011 golf consumer survey data and the 2011 facilities data update. This month we take a look at the Golden State capital, Sacramento CA (home of the famed CBI on The Mentalist for those into crime investigation drama series on TV). Golf is a serious but challenging business in this heartland of the state and warmer, drier easterly neighbor to San Francisco. Surprisingly (at least to us), Sacramento ranks 26th as a CBSA in the nation based on the number of golfers. The sizeable golfer base of roughly 210K is served by only 60 18-hole equivalent (EHE) facilities, producing a ratio of roughly 3,500 golfers per EHE, which is well above the national average. (Remember, this doesn’t count part-time or seasonal residents or any tourist bodies). The supply mix skew vs. the national distribution across Pellucid’s five access/value/usage segments shows high concentrations vs. the US in both Public-Value and Learning & Practice facility types. On the flip side, Public-Premium and PublicPrice are under-represented facility types vs. the US average. The balance of Value-added golf supply (Private & Public Premium) vs. Value golf (Public Value, Price and Learning & Practice) is 44%/56%, very similar to the national distribution of 46%/54%. Within Public-Regulation golf, the distribution between Premium/Value/Price is 23%/63%/14%, which shows a much higher concentration in the mid-range compared to the national distribution of 30%/42%/27%. It would appear that potentially former Public-Premium courses are “playing down” to the Value segment and potentially former Public-Price facilities are pricing up slightly to be in that tight mid-priced group. Like the progressing presidential election, it’s a classic battle for the heart (and wallet) of the middle. During the “go-go” years of supply development (19902000), Sacramento was an “all-in” participant in the build-acourse-a-day craze, adding over 400 holes of golf during the Private PublicPremium PublicValue PublicPrice Learning & Practice Future Facility Golfer Base – Est. # of Golfers (Ks) – # of 18 Hole Equivalent Facilities – Golfers per 18-Hole Equiv. Supply Mix – Private – Pub-Prem – Pub-Val – Pub-Price – Learn & Prac Sacramento, CA Tot US Index vs. US 210.0 26,300 60 14,924 3,500 1,762 31% 13% 36% 8% 12% 8% –2% –10% 41.3 26% 20% 28% 18% 8% 8% –10% –18% 27.7 199 119 65 129 44 150 100 19 56 149 Supply/Demand Balance – ’00-’10 Cume Supply Growth/Decline – ’00-’10 Cume Rds Demand Growth/ Decline – ’00-’10 Cume Mkt Supply Dilution (-)/Absorption (+) Level* – Avg Ann Rds Velocity (ks per 18-hole Equiv.) Rounds & GF Revenue Health – % Utilization Rate – Avg. Ann. Rev. per Public Regulation EHE ($Ks) – Revenue per Available Round (RevpAR) 50% $1,633 $20 52% $983 $16 96 166 124 * Period % Chng in Rds vs. Period % Chng in Supply + Inverseaverage level vs. US (Index >105) Above index, lower is better Average level vs. US (Index 95-104) Below average level vs. US (Index <95) period, creating a cumulative supply dilution level of 33% for the decade (5% annual supply growth against 2% population growth). Since 2000, the change in supply has moderated to a very manageable annual rate of <1%, which fortunately is less The Pellucid PersPecTive www.PellucidcorP.com 13 http://WWW.PELLUCIDCORP.COM

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

The Pellucid Perspective - August 2012
Contents
Private clubs: A time for change
Mobile-optimize or die
Rare fiscal sanity: No new golf
A kinder, gentler approach to speeding pace of play
Golf July weather impact: Up slightly but hot!
Sacramento golf (somewhat) better off than California finances
O’Meara pleads guilty in Running Horse wire fraud, money laundering case
The not-so-terrible 2s

The Pellucid Perspective - August 2012