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.
Click to access Ocean-Palms-Presentation.pdf
Dean Carpenter says
[Selected as the Comment of the Day in the Daily Briefing.–FL]
I don’t understand why the city is speculating on a sport that is declining in popularity and focused on cost containment as the primary path to survival. Unless there is a plan to turn casual golfers into avid golfers all parties involved should project 0 growth in business models.
It seems to me the golf depression is related to the following.
Money
1. Low to median wages are not keeping up with inflation. High income earners will not be seeking a
discount public golf coarse.
2. If you track the annual increase in hotel and restaurant prices visitors will have
less money to spend on golf in the future.
3. Median income was $57,006 in 2007. In 2013 it had dropped to $52,250.
Time
1. Work weeks are getting longer. Over a third of full time employees work more than 50 hours each
week.
2. In a two income home most couples will seek recreation they enjoy together. This reduces the
total number of potential golfers.
3. If 9 holes become popular all current golf clubs will offer the option taking away any potential
competitive advantage.
Location
1. Golfers have a huge selection of golf courses in this region. Can Flagler/leasee afford to maintain a
course that will compete with a private course?
I bet a unique, well run miniature golf course would be more profitable. It would give families a reason to drive here from Daytona and St. Augustine.
DM says
Is it true that Caribbean Condominium Limited, which owns the enclave, and is $3,831 in arrears on taxes is attempting to get the town to approve a rezoning of this enclave for residential use, i.e.. condo’s?
Bob says
Why doesn’t somebody do this with Matanzas Woods? It was a world class 18 hole course which was bought to half the price. And the one company who thinks there will be 55 rounds a day is dreaming.
snapperhead says
“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 same for most on any of the courses around here. Just because they’re 18 hole courses doesn’t mean you have to play 18. And if i’m laying down a 20 spot or so to play 9 holes it won’t be at that cow pasture.
THE VOICE OF REASON says
I wonder if Flagler Golf Management is in any way affiliated with Tee Times USA?
Mr Endeavor says
Great move by the city! Moving forward in the right direction!!