By Design - Summer 2015

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to rename, reposition and rebrand
the facility in the market place.
“Rebranding makes it more viable
to raise prices,” says Brauer. “Golfers
expect to pay more for a better
product, and if achieved it accelerates
the return on investment.”
Re-opening a newly renovated
course also provides the ideal
opportunity for owners to overhaul
and improve all aspects of the
business. Brauer explains: “A new
design and improved conditions will
certainly attract play, but owners
should also update and improve
operational processes, find new
ways to manage maintenance costs,
and restructure or retrain teams to
enhance customer service. Quickly
falling back into old habits can negate
other improvements.”
“Renaming after minor or
infrastructure renovations is less
common, but in any renovation, it
is essential that owners market and
advertise when the course reopens
to showcase new improvements in
conditions and service.”
“While the bigger D-FW renovation
projects drove a greater rise in total
revenue, the NGF and Sirius Golf
Advisors’ report showed the four
courses that underwent minor
renovations also successfully increased
revenues, by an average of $210,250.
And while it could be tempting to
completely redesign the course, it
could be equally lucrative to simply
replace a drainage system or the turf
on the greens. Sometimes, it pays to fix
just what needs fixing on an otherwise
solid course.”
Brauer has found that you must do
nearly everything right and spend
reasonably to achieve best results. He
notes the report showed that projects
spending the least on clubhouse
improvements (under $200,000)
provided the highest ROI.” It also
means minimizing lost revenues
by properly timing your renovation
to meet grassing dates. Or paying
for more sod to shorten grow-in
time. “On average, the major D-FW
renovations took seven months to
complete, giving your customers a
chance to play different courses in
the interim, so the owners need to
work hard to ensure they return,”
said Brauer.
It starts with establishing a clear
business plan outlining financial
possibilities and targets for repairing,
replacing and redesign that will
help to generate a positive ROI and
increase revenue. “Every proposed
renovation needs its own specific
economic analysis and, since 2006,
most golf course renovations and
master plans have been preceded by
an overall business plan,” said Brauer.
But the experience and expertise of a
golf course architect is critical to help
arrive at the right decision.
According to Brauer, the consistency
of increased positive rounds, revenues
and ROI results in the NGF and
Sirius Golf Advisors report are vrey
encouraging for anyone considering a
major renovation, particularly in large
and vibrant areas where the public
golf market is similar to that of DF-W.
“Course owners will agree that while
renovations can be challenging, they
are often a less risky strategy than
doing nothing at all.”•
For more information on how an ASGCA
member can assist in your renovation
project, download ‘The Golf Course
Remodeling Process: Questions & Answers’
from
ANALYSIS
Course
Major 1
Major 2
Major 3
Major 4
Major 5
Major 6
Major 7
Major 8
Major 9
Minor 1
Minor 2
Minor 3
Minor 4
Renovation cost
$9,999,000
$8,800,000
$8,200,000
$4,000,000
$4,600,000
$3,700,000
$3,400,000
$2,900,000
$1,940,000
$950,000
$350,000
$300,000
$180,000
Revenue per year
(Before)
$435,000
$1,265,000
$1,395,000
$1,824,000
$773,000
$385,000
$787,000
$1,250,000
$1,080,000
$1,031,000
$897,000
$847,000
$1,894,000
Revenue per year
(After Year 1)
$1,163,000
$2,153,000
$2,200,000
$2,200,000
$882,000
$553,000
$1,000,000
$1,800,000
$1,850,000
$1,147,000
$1,659,000
$1,109,000
$2,014,000
Revenue per year
(After Year 2)
$1,041,950
$1,986,000
$2,112,000
$2,025,000
$846,720
$569,000
$950,000
$1,640,000
$1,665,000
$874,000
$1,657,000
$1,025,000
$1,957,000
Return
6.1%
8.2%
8.7%
5.0%
1.6%
5.0%
4.8%
13.4%
30.2%
-16.5%
217.1%
59.3%
35.0%
Source: NGF, Sirius Golf Advisors and Jeff Brauer, ASGCA Past President
while renovations can be challenging, they
are often a less risky strategy than
doing nothing at all