I'm gonna brag a bit here...
I just received a real nice testimonial from Brian Crawford, PGA Professional and an owner of a golf club in Missouri:
"I have known Mike Kahn for years and his experience and wisdom of the entire golf industry is legendary. I am the head golf pro and an owner of a golf course and country club in Mo. I have been in the industry for many years and know enough to always seek good advice. It's crucial in any business to have people you trust and respect. To this day I still pick his brain for advice and ideas. Before you make a move in this ever changing world of golf I strongly suggest you contact Mike. Reach out and spend just a little time with Mike and it can save you big in the future. "
I love to answer inquiries from anyone, anywhere in the golf world. I hear from students, golf course owners, appraisers, persons aspiring to own a golf course, brokers and even attorneys. I always reply with my advice or comments.
Try me anytime: 941-739-3990, email: mike@golfmak.com, Skype: GOLFMAK.
Mike
Hello from Mike Kahn: I'm all about the golf business and the game. As my distance off the tee shrinks, apparently participation in golf is also shrinking. I've seen it all and done it all in the golf business, yet I've been a recreational player 99% of the time. The 1% was when I was a Canadian PGA member in the early 60's. As I blog along, probably mostly talking to myself, my comments might be picked up by a blind squirrel - and maybe even post a reply.
Tuesday, April 2, 2013
Monday, April 1, 2013
April 1, 2013: Application for a Golf Course Bank Loan
Last week, as consultant for a golf course buyer, I attended a loan application meeting with the bank loan officer, the bank branch manager, the golf course buyer and borrower and an attorney. The golf course buyer was under a purchase and sale contract to buy the golf course and was seeking bank financing for a portion of the purchase. Earlier, I visited and reviewed the subject golf course, its marketplace, and reviewed three years of financial statements.
There was one very impressive aspect of the golf course property that I knew would impress the banker: It is a 'some-day' valuable piece of land.
However, in the world of banking the same holds true today as it has for 100-years: The banker looks at the ability to repay the loan, which must be clearly demonstrated in the recent financial history of the course. Unfortunately, the financial history was not impressive enough to qualify for a head-office-approved loan - for which I was not surprised.
It was an interesting meeting, because the loan officer and the branch manager knew the property and really wanted to approve the loan. That's because the land under the golf course still retained most of its property rights. That fact is typical of a golf course built forty or more years ago. Therefore, future value of the land could be anywhere from $10 to $20 million, more than adequate to support a $1 million dollar mortgage. Nonetheless, the ability of the borrower to make loan payments today could not be demonstrated, so the borrower was advised the bank could not process the loan request.
So, how can one finance a golf course with a bank?
Conventionally, the business must show the banker it can meet debt service based on the most recent financial history - usually the trailing 36-months of income less expenses.
But wait! Some loan officers can make loans of under $1 million without going to head office for approval. However, it will likely be a loan of 50% or less loan to value (LTV). If a convincing business plan can show the loan officer the true potential and performance of the business will meet debt service, a 50% loan might be approved. So, we continued...
Applying my expertise, plus exceptional field work by the borrower a presentation in power point was created. I believe the assumptions and forecasts are very attainable and could get a positive response from the bank. The presentation is in the final edit stages.
Stay posted. It will be an experience to achieve the first golf course bank loan I have seen in at least 8 years.
Mike
Last week, as consultant for a golf course buyer, I attended a loan application meeting with the bank loan officer, the bank branch manager, the golf course buyer and borrower and an attorney. The golf course buyer was under a purchase and sale contract to buy the golf course and was seeking bank financing for a portion of the purchase. Earlier, I visited and reviewed the subject golf course, its marketplace, and reviewed three years of financial statements.
There was one very impressive aspect of the golf course property that I knew would impress the banker: It is a 'some-day' valuable piece of land.
However, in the world of banking the same holds true today as it has for 100-years: The banker looks at the ability to repay the loan, which must be clearly demonstrated in the recent financial history of the course. Unfortunately, the financial history was not impressive enough to qualify for a head-office-approved loan - for which I was not surprised.
It was an interesting meeting, because the loan officer and the branch manager knew the property and really wanted to approve the loan. That's because the land under the golf course still retained most of its property rights. That fact is typical of a golf course built forty or more years ago. Therefore, future value of the land could be anywhere from $10 to $20 million, more than adequate to support a $1 million dollar mortgage. Nonetheless, the ability of the borrower to make loan payments today could not be demonstrated, so the borrower was advised the bank could not process the loan request.
So, how can one finance a golf course with a bank?
Conventionally, the business must show the banker it can meet debt service based on the most recent financial history - usually the trailing 36-months of income less expenses.
But wait! Some loan officers can make loans of under $1 million without going to head office for approval. However, it will likely be a loan of 50% or less loan to value (LTV). If a convincing business plan can show the loan officer the true potential and performance of the business will meet debt service, a 50% loan might be approved. So, we continued...
Applying my expertise, plus exceptional field work by the borrower a presentation in power point was created. I believe the assumptions and forecasts are very attainable and could get a positive response from the bank. The presentation is in the final edit stages.
Stay posted. It will be an experience to achieve the first golf course bank loan I have seen in at least 8 years.
Mike
Monday, April 1, 2013
I am looking for a golf course for an investor in Maryland. He will look anywhere in the USA - preferring the eastern side. He has a down payment and will need seller financing.
The ideal golf course for this person will be 18-holes, clubhouse, but not a monster. Public or semi-private, making at least some money - enough to cover the seller's mortgage and make a reasonable profit. This person will be an n site owner-operator.
Send me an email (mike@golfmak.com) if you have a golf course available that might fit. I am his consultant and buyer-broker.
Mike
I am looking for a golf course for an investor in Maryland. He will look anywhere in the USA - preferring the eastern side. He has a down payment and will need seller financing.
The ideal golf course for this person will be 18-holes, clubhouse, but not a monster. Public or semi-private, making at least some money - enough to cover the seller's mortgage and make a reasonable profit. This person will be an n site owner-operator.
Send me an email (mike@golfmak.com) if you have a golf course available that might fit. I am his consultant and buyer-broker.
Mike
Sunday, March 31, 2013
Hi...
Well... I just joined the Golf Course Business Consultants (GCBC) a group of highly specialized experts in the golf industry. I am in the company of well established gurus like Jack Brennan. Paladin Golf Marketing, Ron Garl, leading golf course architect, and John Johnson of J2 Marketing. Check out the GCBC site at: http://gcbcinc.com/.
Man! We're watching so many sinking ships out there. In desperation I see what were once high end private country clubs with tee times on all the re-seller sites. Some have hired management companies to market tee times competing with traditional daily fee golf courses. I'm seeing $100.00 rounds going for $39.00 in the Sarasota - Bradenton (Florida) market. One course is advertising $19.00 rounds that were $65.000 ten years ago.
Where are we going from here? I mean, expenses have not really gone down - except cutting corners.
More later.
Well... I just joined the Golf Course Business Consultants (GCBC) a group of highly specialized experts in the golf industry. I am in the company of well established gurus like Jack Brennan. Paladin Golf Marketing, Ron Garl, leading golf course architect, and John Johnson of J2 Marketing. Check out the GCBC site at: http://gcbcinc.com/.
Man! We're watching so many sinking ships out there. In desperation I see what were once high end private country clubs with tee times on all the re-seller sites. Some have hired management companies to market tee times competing with traditional daily fee golf courses. I'm seeing $100.00 rounds going for $39.00 in the Sarasota - Bradenton (Florida) market. One course is advertising $19.00 rounds that were $65.000 ten years ago.
Where are we going from here? I mean, expenses have not really gone down - except cutting corners.
More later.
Friday, December 7, 2012
NEW PRODUCT - SHOWS YOUR LOYAL PLAYERS YOU CARE
Golfers everywhere,
Next time you step up to the first tee look for the Tee-Stretch and take a very quick and simple stretch warmup. You'll take a relaxing 'hang' that will prepare you for that first drive down the fairway.
Designed by people who have been creating this type of apparatus for many years, Tee-Stretch will become a must for every golfer before teeing off.
Have a look at it here: http://www.tee-stretch.com.
Tell your club you want one at the first tee at your course. And, by the way: They can actually make a few bucks a year by agreeing to the classy advertisments you see on the web site.
If you are a board member, golf course owner, municipally owned golf course, write me at: mike@golfmak.com. I will see that aTee-Stretch is installed at your club.
Play better golf by being prepared for your first drive.
Mike
Next time you step up to the first tee look for the Tee-Stretch and take a very quick and simple stretch warmup. You'll take a relaxing 'hang' that will prepare you for that first drive down the fairway.
Designed by people who have been creating this type of apparatus for many years, Tee-Stretch will become a must for every golfer before teeing off.
Have a look at it here: http://www.tee-stretch.com.
Tell your club you want one at the first tee at your course. And, by the way: They can actually make a few bucks a year by agreeing to the classy advertisments you see on the web site.
If you are a board member, golf course owner, municipally owned golf course, write me at: mike@golfmak.com. I will see that aTee-Stretch is installed at your club.
Play better golf by being prepared for your first drive.
Mike
Wednesday, December 5, 2012
AGILITY. DOES YOUR GOLF CLUB HAVE IT?
Hi everyone.
Sorry that I've been lax in this department. I have so much to say I don't know where to start. However, I have a question for golf course owners, board members and management companies: Are you agile enough to adjust to your environment? Can you shift gears quickly?
I believe the golf world is moving at light speed. The Internet, direct communication with customers via cel phones along with the current highly competitive business environment, I believe, requires up-to-the-minute decisions.
We all know (now) that there is a finite number of golf players out there and they cannot be two places at once. As a business person you want the customer in your store - not the competitor's store. You need to do what you have to do to win that customer, which means continued communication with the customer base with reminders, enticements, and loyalty rewards.
I've been at it for over 50-years. I never sat back and watched the customers roll in. I never let up. My marketing budget was always up to ten times what golf courses normally spend to keep the name out there. That's why I was able to boost revenues at the Ravines in Jacksonville in my short stint there (the folks that followed reversed all I had accomplished). I was able to manage Oak Ford Golf Club in Sarasota from less than 50,000 rounds to over 80,000 in a couple of seasons - successful in rescuing the business from bankruptcy.
As an associate with the Brookwoods Country Club, Ontario, New York, under management by PGA Professional, Bill McIntosh, the 2012 season was the best in almost a generation. Rounds up, golf revenues up, clubhouse activities up. McIntosh is a promoter like me. And, man! The Rochester area of upper New York is a very competitive golf neighborhood.
I'm always available for a complimentary consultation for any course owner, general manager, board member, even bankers to discuss a golf club;s current situation.
Remember my web site: www.golfmak.com.
I would enjoy your comments.
Mike
Sorry that I've been lax in this department. I have so much to say I don't know where to start. However, I have a question for golf course owners, board members and management companies: Are you agile enough to adjust to your environment? Can you shift gears quickly?
I believe the golf world is moving at light speed. The Internet, direct communication with customers via cel phones along with the current highly competitive business environment, I believe, requires up-to-the-minute decisions.
We all know (now) that there is a finite number of golf players out there and they cannot be two places at once. As a business person you want the customer in your store - not the competitor's store. You need to do what you have to do to win that customer, which means continued communication with the customer base with reminders, enticements, and loyalty rewards.
I've been at it for over 50-years. I never sat back and watched the customers roll in. I never let up. My marketing budget was always up to ten times what golf courses normally spend to keep the name out there. That's why I was able to boost revenues at the Ravines in Jacksonville in my short stint there (the folks that followed reversed all I had accomplished). I was able to manage Oak Ford Golf Club in Sarasota from less than 50,000 rounds to over 80,000 in a couple of seasons - successful in rescuing the business from bankruptcy.
As an associate with the Brookwoods Country Club, Ontario, New York, under management by PGA Professional, Bill McIntosh, the 2012 season was the best in almost a generation. Rounds up, golf revenues up, clubhouse activities up. McIntosh is a promoter like me. And, man! The Rochester area of upper New York is a very competitive golf neighborhood.
I'm always available for a complimentary consultation for any course owner, general manager, board member, even bankers to discuss a golf club;s current situation.
Remember my web site: www.golfmak.com.
I would enjoy your comments.
Mike
Monday, April 23, 2012
GOLF COURSE BUSINESS - SERIOUS!
It's 2012 and the golf course industry is in a serious correction (that's a kind term, it's really in a decline) due to an oversupply of golf courses and at flat or declining participation rate of golf players.
We're seeing private clubs going public because their membership is down 50%. Their beautiful palace (clubhouse) can no longer sustain itself because they're collecting half the annual dues they were collecting ten years ago.
Many troubled golf courses are part of residential developments - especially the southeast USA. In Florida several courses have closed - Ravines in Middleburg, Forest Lakes in Sarasota, Turkey Creek in Alachua, and several others. There are several on the brink at the moment this article is being written.
What is the solution?
I'm a 'Back-in-the-Box' thinker. There are times when we have to look at what worked when golf was a growing (virtually exploding) industry. I mean, what was it that took golf from 90% private to 90% public between 1955 and 2005?
I was there all the way. I watched golf grow. I was part of it. For at least my first 30-years in golf we were constantly building the game. I mean encouraging people to play. All kinds of people: kids, men, women, seniors. We made it easy to get started. Easy lessons, starter sets of golf clubs, beginner or starter leagues. All that stopped sometime around 1985. I know the National Golf Foundation indicated growth in participation had been flat since the late 1990s, but I believe golf stopped its strong growth pattern at least 10 and probably 15 years earlier.
When I say, "Golf needs to get itself back in the box." I'm trying to regenerate the enthusiasm for growing golf from the grass roots. I want to see the National Golf Foundation getting back to the business they were founded on - growing the game of golf.
They don't want to hear this, but the PGA and the USGA have, been patting themselves on the back for the last 30-years, when they should have been watching the game - taking a few minutes a day to come down to street level. They needed then, and more importantly now, to look at the foundation of golf, the 90-shooters, the hackers, the dreamers who buy those $600.00 drivers.
Truth is, the powers in golf have become too snobbish, too removed from golf's grass roots. Where are all the drive-by driving ranges? What happened to the par-3 and executive golf courses? Who conducts learn-to-play-golf classes for beginners?
Do you own a golf course? When was the last time you actually started a brand new golfer?
Show me one management company who sincerely runs golf growth programs.
I believe there are as many people out there who do not play golf who would play if the route to play was more inviting. We're talking up to 30 million North Americans who don't play golf who would at least give the game a try. But the 'powers' in golf have to use their heads.
If I'm going to market to find new golfers the last place I will advertise is on the golf channel, or, for instance, in Golf Digest. I hate to use the word 'stupid' but think of it: The only people who watch the golf channel, or subscribe to Golf Digest are already golfers! When you're aiming at the 90% of population who do not play golf you have to go to the widest audience possible. That sure ain't the golf channel!
I learned the largest reading audience in a small town newspaper was the obituary page - really! Women generally turned to that page first. So, that's where I ran my ads for my learn to play golf classes. I set up the ad so a woman would be attracted to it - not that they were to be my intended new golf prospect, but they would show it to their spouse and family members. I used the same strategy every year for over 20-years and sold out every class every spring in Peterborough, Ontario (1965 through 1985). I'm not talking a class of ten people. We started between 230 and 250 new golfers every year for over 20-years. That's the box we need to jump back into!
Any comments so far? Dig in. Say something!
We're seeing private clubs going public because their membership is down 50%. Their beautiful palace (clubhouse) can no longer sustain itself because they're collecting half the annual dues they were collecting ten years ago.
Many troubled golf courses are part of residential developments - especially the southeast USA. In Florida several courses have closed - Ravines in Middleburg, Forest Lakes in Sarasota, Turkey Creek in Alachua, and several others. There are several on the brink at the moment this article is being written.
What is the solution?
I'm a 'Back-in-the-Box' thinker. There are times when we have to look at what worked when golf was a growing (virtually exploding) industry. I mean, what was it that took golf from 90% private to 90% public between 1955 and 2005?
I was there all the way. I watched golf grow. I was part of it. For at least my first 30-years in golf we were constantly building the game. I mean encouraging people to play. All kinds of people: kids, men, women, seniors. We made it easy to get started. Easy lessons, starter sets of golf clubs, beginner or starter leagues. All that stopped sometime around 1985. I know the National Golf Foundation indicated growth in participation had been flat since the late 1990s, but I believe golf stopped its strong growth pattern at least 10 and probably 15 years earlier.
When I say, "Golf needs to get itself back in the box." I'm trying to regenerate the enthusiasm for growing golf from the grass roots. I want to see the National Golf Foundation getting back to the business they were founded on - growing the game of golf.
They don't want to hear this, but the PGA and the USGA have, been patting themselves on the back for the last 30-years, when they should have been watching the game - taking a few minutes a day to come down to street level. They needed then, and more importantly now, to look at the foundation of golf, the 90-shooters, the hackers, the dreamers who buy those $600.00 drivers.
Truth is, the powers in golf have become too snobbish, too removed from golf's grass roots. Where are all the drive-by driving ranges? What happened to the par-3 and executive golf courses? Who conducts learn-to-play-golf classes for beginners?
Do you own a golf course? When was the last time you actually started a brand new golfer?
Show me one management company who sincerely runs golf growth programs.
I believe there are as many people out there who do not play golf who would play if the route to play was more inviting. We're talking up to 30 million North Americans who don't play golf who would at least give the game a try. But the 'powers' in golf have to use their heads.
If I'm going to market to find new golfers the last place I will advertise is on the golf channel, or, for instance, in Golf Digest. I hate to use the word 'stupid' but think of it: The only people who watch the golf channel, or subscribe to Golf Digest are already golfers! When you're aiming at the 90% of population who do not play golf you have to go to the widest audience possible. That sure ain't the golf channel!
I learned the largest reading audience in a small town newspaper was the obituary page - really! Women generally turned to that page first. So, that's where I ran my ads for my learn to play golf classes. I set up the ad so a woman would be attracted to it - not that they were to be my intended new golf prospect, but they would show it to their spouse and family members. I used the same strategy every year for over 20-years and sold out every class every spring in Peterborough, Ontario (1965 through 1985). I'm not talking a class of ten people. We started between 230 and 250 new golfers every year for over 20-years. That's the box we need to jump back into!
Any comments so far? Dig in. Say something!
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