Three Companies Tee Up Proposals to Run Flagler Beach’s Fallow 9-Hole Golf Course
FlaglerLive | September 17, 2015
Disused and overgrown for seven years, the 34 acres of what used to be the Ocean Palm Golf Club at the south end of Flagler Beach will be in serious play for the first time this evening at 5:30 p.m. as a city committee hears proposals from three companies to take over the grounds and run them as a golf course again.
The city owns the grounds since 2013, when it bought the acreage for $490,000 in a foreclosure sale. But the city has had trouble finding a firm willing or capable to lease and run the site. Golf is in the midst of a prolonged depression, with thousands of courses failing or closing in the last several years and many more–among them the Palm Coast-owned Palm Harbor Golf Club–losing money. Flagler Beach is hoping to take advantage of one caveat: that nine-hole courses are better suited for today’s environment than time-sucking 18-hole courses.
“From a time standpoint, we’re all busy, everybody is connected full speed all day long,” Flagler Beach City Manager Bruce Campbell said. But with a 9-hole course, in contrast, “you can get down here after work at 5 o’clock and be done at 6:30.”
The presentations by the three golf concerns will take place, without time limits, before the so-called Alternative Use Committee. That committee has no binding power on the Flagler Beach City Commission. But its recommendation to the commission will carry weight. Most, possibly all, of Flagler Beach’s commissioners are expected to attend the meeting this evening, held at city hall’s commission chambers.
The three companies presenting are Pine Lakes Golf Club, Indigo Golf Club of Daytona Beach, and Flagler Golf Management, the latter a firm that first registered last March and listing Duane McDaniel of Flagler Beach and Terrence McManus of Wellington, Fla., as its principals.
The golf club includes an enclave of about 3 acres that the city does not own, and tried to buy. But the owners have so far been unwilling to sell. The enclave appeared to have been an obstacle for some companies to take over the rest of the grounds, but the companies presenting this evening are aware of the snag, and are making their proposals with the understanding that the 3 acres will remain out of their hands.
Flagler Golf Management is proposing to take over the grounds in a 40-year lease, at $1 for the first five years. It would then pay the city 3 percent of all gross revenue, including food, alcohol and other drinks, over the next 35 years. If the city were to take in a $2,000 a month rent payment, in other words, the golf course would have to generate gross revenue of just under $67,000 a month. The company expects s somewhat lower revenue stream.
Salaries would total $120,000 a year, and annual gross operating costs are projected at $189,000. The company expects a gross revenue of $470,000 a year–$400,000 of it from 20,000 rounds of golf per year, or 55 rounds per day. So net profit would be $281,100. The 3 percent share for the city, according to those calculations, would be $14,000, or $1,175 a month, far less than what the city would be earning in tax revenue if the land was owned privately and run as a golf course privately. The taxes owed this year on the 3-acre enclave within the golf course totaled $1,621, with $379 of that owed Flagler Beach. A 37-acre parcel at the same taxable value would generate $4,674 in city taxes. (Caribbean Condominium Limikted, which owns the enclave, is $3,831 in arrears on taxes.)
Flagler Golf Management proposes to invest $274,000, including $166,300 in capital improvements and 10 golf carts for $30,000. The company is asking the city to contribute $14,700, money the city ostensibly spends to mow the property. Whether that contribution is requested every year or just once is unclear. The company pledges to get the operation going within 120 days of signing the agreement.
Pine Lakes and Indigo golf clubs did not turn in proposals ahead of time. In March, Indigo sent a letter of intent to the city in which it requested the complete demolition and removal of the existing clubhouse and required that Flagler Beach buy the 3-acre enclave.