Case Study

Management of Troubled Golf Assets:  Creating solutions and "peace of mind" in uncertain times


Opportunity

In 2007, KemperSports was hired by a national real estate venture fund to restore profitability to three private clubs whose financial situation, member satisfaction and overall club quality had deteriorated. The three clubs, located across the country, were losing money due to excessive operating costs, declining operating revenue and deteriorating brand identity. The owner of the three properties turned to KemperSports to rejuvenate these once prestigious private clubs and solve their financial struggles.


Action

KemperSports brought in its team of experts to evaluate the three clubs’ operations, facilities, golf course, staff and marketing and sales programs. KemperSports reorganized the staffing of each department while improving service levels and re-energizing the property team through proprietary training programs. KemperSports’ experienced team of experts also evaluated the clubs’ course maintenance and agronomic practices and quickly made adjustments to improve course conditions, reduce costs and provide for a higher-quality golf experience. KemperSports leveraged its national purchasing power to significantly decrease the costs of maintenance equipment, food and beverage, merchandise and other operating supplies and was able to purchase new cart fleets from a nationally-known vendor at a reduced cost.

Not only did KemperSports decrease costs at these three clubs, it was also able to drive incremental revenue. KemperSports hired, trained and supported new property leadership, and inspired a new commitment to increase both membership and member satisfaction. New programming was created to re-engage existing members and, coupled with improved course conditions, make the clubs more attractive to potential new members. All the while, KemperSports Regional and Home Office staffers supported the properties by providing best practices and techniques learned from KemperSports’ other private facilities and KemperSports’ 30 years of management experience. Very quickly, both member referrals and membership sales began to increase.

 

Results

Within the first calendar year, these clubs, which had previously been operating at a significant loss, were turned around with combined EBITDA increases of over $1.25 million. Each club also regained its status among the best private clubs in its respective market. In early 2009, the owner decided to realize the enhanced value that had been created by selling one of the three clubs. KemperSports continues to operate and improve business results for the other two clubs.

Contact Laura Matthews at (847) 291-6852 to learn more about our services for troubled golf assets. Or click here to request more information.