The Pellucid Perspective - January 2014 - (Page 14)

MARKET FOCUS Development restraint buoys Miami golf market Miami, FL 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 9th healthiest golf market in country, Miami/Ft. Lauderdale FL. As it turns out, we have recent exposure to this market, having just returned from a Caribbean cruise that departed out of the Port Everglades terminal in Ft. Lauderdale. This market is the land of private golf as you can see on the accompanying map, rivaled in supply distribution by its more westerly FL neighbor market, Naples. By rounds demand (our selection criteria for market inclusion in the Top 25 list), Miami has a healthy number 6 ranking of US markets with facility-reported annual demand of just over 7.3M rounds. (That facility-reported tally counts both local and tourist play). Looking at the golf consumer base, we see that Miami is home to an abundant local golfer base of roughly 455K golfers. (This is only local, resident population; it doesn't count all the tourists like me escaping the cold and snow of the north or the snowbirds that take up full-time residence there during the winter months). That golfer base is served by an abundant 232 18-hole equivalent (EHE) facilities, producing an above average ratio of roughly 2K 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 strong bias to the Private segment at 52% of holes vs. 27% of holes nationally. The balance of Value-added golf supply (Private & Public Premium) vs. Value golf (Public Value, Price and Learning & Practice) is 63%/37%, which is significantly skewed to the Value-added segment vs. the national average (50%/50%). Within PublicRegulation golf, the distribution between Premium/Value/Price is 27%/51%/22% which represents a pronounced bias to Value, compared to the national distribution of 34%/42%/24% (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), Miami resisted the urge to "build a course a day," lagging the national rate of supply expansion by adding holes at a Compound Annual Growth Rate (CAGR) of just under 1% (compared to the 2%+ national expansion rate). This was likely due in part to the limited supply and expense of developable land for golf, given that population growth during this period (~+2%) outpaced the national average. This translates to the market entering the 21st century with a projected positive sup- 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 Miami, FL CBSA Tot US Index vs. US 454.7 24,400 232 14,675 1,964 1,663 Supply Mix - Private - Pub-Prem - Pub-Val - Pub-Price - Learn & Prac 118 52% 11% 21% 9% 7% 27% 23% 28% 16% 6% 193 48 75 56 117 4% -22% 8% -15% 57 143 -26% -23% 114 29.7 26.7 111 39% $1,610 44% $836 89 193 $21 $14 150 Supply/Demand Balance - '00-'11 Cume Supply Growth/Decline - '00-'11 Cume Rds Demand Growth/ Decline - '00-'11 Cume Mkt Supply Dilution (-)/Absorption (+) Level* - Avg Ann Rds Velocity (ks per 18-hole Equiv.) Rounds & GF Revenue Health - % Utilization Rate - Avg. Ann. Rev. per Public Regulation EHE ($Ks) - Revenue per Available Round (RevpAR) Future Facility * 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) January 2014

Table of Contents for the Digital Edition of The Pellucid Perspective - January 2014

2013: Farewell vs. good riddance – Industry bends but doesn't break
GolfNow's PMP sales pitch: Join or be stolen from
College Golf Pass aims to close golf's participation "doughnut hole"
Gender-based golf promotions carry risk
Orlando – Golf Central USA
December golf weather impact: Significant down month closes year of downs
Development restraint buoys Miami golf market
GreatLife expands business model into 3rd state
The PGA Show – just like a box of chocolates

The Pellucid Perspective - January 2014