The Pellucid Perspective - December 2013 - (Page 13)

MARKET FOCUS Red Sox nation plays golf too Boston, MA Core Business Statistical Area (CBSA) C ontinuing our sequential series of profiling the healthiest Top 25 US Golf Markets as quantified and ranked by Pellucid using a 10-measure composite scoring system (things like population size/growth, golfer base, rounds generation, supply/demand balance, utilization and RevpAR), this month we highlight the 8th healthiest golf market in the country, Boston MA. While it rarely gets press as a golf destination or as one of the top golf markets in the country, Beantown USA is a very vibrant and well-developed place to call home if you're a golfer. It also has the advantage of a slightly more temperate climate in relation to its latitude given the coastal maritime influence that provides its share of "bluebird" golf days outside the core season compared to other major metros like Chicago. By rounds demand (our selection criteria for market inclusion in the Top 25 list), Boston is a "sleeper" ranking number 7 of US markets with facility-reported annual demand of just over 6.5M rounds (that facility-reported tally counts both local and tourist play). Looking at the golf consumer base, we see that Boston is home to an abundant local golfer base of nearly 500K golfers (this is only local, resident population; it doesn't count all the history buff tourists or the college families coming to see what their significant investment is buying). That golfer base is served by an abundant 183 18-hole equivalent (EHE) facilities producing an above average ratio of 2.7K golfers per EHE (again, this metric is based off locals only). The supply mix vs. the national distribution across Pellucid's five access/value/usage segments shows a clear bias to the Private segment at 33% of holes vs. 27% of holes nationally. Interestingly, there's also a slight skew on the opposite end of the affordability spectrum to Learning & Practice at 9% of supply compared to the 6% national average. The balance of Value-added golf supply (Private & Public Premium) vs. Value golf (Public Value, Price and Learning & Practice) is 50%/50%, which is dead on the national average. Within Public-Regulation golf, the distribution between Premium/Value/Price is 29%/46%/25%, which represents a slight bias to Value, compared to the national distribution of 34%/42%/24%. (It's not a bad thing to be more heavily weighted to the middle vs. top or bottom-heavy). During the "go-go" years of supply development (19902000), Boston lagged the national rate of supply expansion, adding holes at a Compound Annual Growth Rate (CAGR) of 1.6% (compared to the 2.3% national expansion rate). This was likely due in part to the limited supply and expense of developable land for golf and was also prudent in that population growth during this period lagged the national average, meaning the market entered the 21st century with average supply "overhang" (-10% cumulatively vs. 11% nationally). Since 2000, the rate of supply growth has changed little (1.4% CAGR), which Private PublicPremium PublicValue PublicPrice Golfer Base - Est. # of Golfers (Ks) - # of 18 Hole Equivalent Facilities - Golfers per 18-Hole Equiv. Learning & Practice Boston, MA CBSA Future Facility Index vs. US 498.8 24,400 183 14,675 2,733 1,663 Supply Mix - Private - Pub-Prem - Pub-Val - Pub-Price - Learn & Prac Tot US 164 33% 17% 27% 15% 9% 27% 23% 28% 16% 6% 122 74 96 94 150 15% 4% 8% -15% 200 N/A -11% -23% 48 29.3 26.7 110 54% $1,338 44% $836 123 160 $25 $11 227 Supply/Demand Balance - '00-'11 Cume Supply Growth/Decline - '00-'11 Cume Rds Demand Growth/ Decline - '00-'11 Cume Mkt Supply Dilution (-)/Absorption (+) Level* - Avg Ann Rds Velocity (ks per 18-hole Equiv.) Rounds & GF Revenue Health - % Utilization Rate - Avg. Ann. Rev. per Public Regulation EHE ($Ks) - Revenue per Available Round (RevpAR) * Period % Chng in Rds vs. Period % Chng in Supply + Inverse index, lower is better Above average level vs. US (Index >105) Average level vs. US (Index 95-104) Below average level vs. US (Index <95) The Pellucid PersPecTive 13 http://WWW.PELLUCIDCORP.COM

Table of Contents for the Digital Edition of The Pellucid Perspective - December 2013

The Pellucid Perspective - December 2013
Back to the future for golf course owners
Winds of change blowing in tee time sales world
An “Island” of creative thinking in player development
Europe follows US lead
November golf weather impact: Mother Nature gives golf the “cold shoulder”
Boston, MA: Red Sox nation plays golf too
OB Sports chosen to operate Tucson muni courses
Too tough to chew

The Pellucid Perspective - December 2013