The club lost about 20 percent of its
members, but it’s unknown how many
left for other reasons, such as cutting
back because of the economic downturn.
What’s known is that the club regained
that loss and has grown even larger since
the improvements, which were funded
by a bank loan, second mortgage offerings, donations and an assessment.
If the club did not invest, “at best, we’d
be struggling,” Fiscus said.
Other clubs can certainly relate. Sugar
Creek County Club in Sugar Land, Texas,
which is outside of Houston, is undergoing nearly $3 million in upgrades to its
course and clubhouse.
It had little choice, said General
Manager and CEO Gordon Wagner. “We
were dying on the vine,” he said.
Before he arrived in 2009, the club,
which opened in 1972, had done away
with initiation fees to attract members.
It was losing money. The club didn’t
even have the funds to do a master
plan. However, given the way the course
was evolving, the path was pretty clear,
Wagner said. Investment was needed.
He had support from the board and
the board president. “We had to go all-
in,” he said. “We had a substandard facil-
ity in the market place.”
However, initially, he couldn’t get help
from a bank, considering the club’s finan-
cials. It was $2.5 million in the hole. After
the club finally made money in 2011, he
was able to convince a bank to lend the
club $3 million. That left the club $1.5
million short for improvements, though.
First, Wagner went to members with
the idea to do away with the $40 minimum charge per month for food and beverage. Instead, that monthly fee would go
to capital improvements. Wagner figured
— and rightly so — that improvements
to the clubhouse eateries would attract
customers. The dining areas were to be
revamped and an outdoor patio for dining was planned.
As the case with Tulsa, the club also
turned to its members, asking them to
invest. In this case, members could invest
from $20,000 to $100,000 and receive
interest for the notes. Some of the old-guard were concerned about taking on
more debt, but the majority of the members understood the need, he said. In the
end, 88 percent voted for the upgrades.
Only five members left.
The course has 27 holes, so improvements are being made nine holes at time,
to allow for play. The last nine holes will
be renovated in 2016. It’s paying off.
Membership, which had bottomed-out at
580, has since grown to 635. “The results
have been good,” Wagner said.
Much of the internal angst over these
improvements can be avoided if the club
has planned for them, said Ray Cronin,
If you’re the first type of club, a renovation can be straightforward, he said. If
you’re the second, the effort to do so can
tear the club apart, he said.
The best way to persuade members is to
present the facts. “The data show clearly
that there is a correlation between investing and the health of a club,” he said.
Club Benchmarking also advises clubs
to prepare for investments well into the
future. “We are big believers in clubs having on hand a capital reserve study that
is done by an outside professional and
looks forward 20 years.”
If a club has to levy an assessment for
an improvement, it’s likely the club will
see membership defection. The bigger
the assessment, the bigger the defection,
Cronin said. Initiation fees also play a
role. The higher the fee, the less flight
The best solution? “We at Club
Benchmarking believe that isolating
capital dues and charging a recurring
monthly amount of capital dues is a best
practice,” Cronin said. “Members must
understand that a club’s capital needs are
real and must be funded by the members.”
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