Mr Business Golf

It has been awhile since I have reported on the results of the sale of ClubCorp of America to KSL. It is not that there has been nothing to report because I am hearing everything the members are saying, but not anything from the new owners.

Mostly my lack of reporting on the sale is due to neither KSL nor the management of ClubCorp feel it important to make an announcement on what specifically they are going to do to please the 100 thousand or so members of their many country clubs.

CCA did, in their usual way, make an announcement in this month’s bill with the increases they made in the service fees. How CCA goes about making announcements is par for a company that has bad news to pass on to its members. I am still gathering information on if this is company wide situation or just local to their flagship cash cow club, Brookhaven Country Club.

Like the many other increases made over the past five years the members can rest assured that these increases will more than likely not go towards any of the many major improvements needed for the aging club.

Annual increases have been standard procedure for this club’s recent management style alone with the members expecting the usual result of little to show for the increase. The clubhouse, build in the mid 60’s, still is in desperate need of being replaced. The pro-shop and locker rooms and other infrastructures like plumbing and electrical are so outdated that the majority of members are embarrassed to bring friends and relatives to the club, much less admitting to anyone they are paying monthly fees for such a dilapidated facility.

However, this management crew feels an increase in food, beverages and other services is needed to keep up with alleged increases in operation costs. Yes, like most businesses, CCA also finds it easy to blame the increase in service fees on operations costs and as the reason for not making needed improvements.

Since nothing other than KSL and CCA propaganda has been announced since the Deadman family dumped the family business and ran, there is little else for the members to consider will happen at the club other the increases in their monthly bill that more than likely is going towards paying for the costs KSL incurred for buying the business.

OH, the club management has had some private meetings with a select few members who have been hand picked to represent the membership. What this group was told was of a vague plan CCA wants the members to believe they have for improving minor issues. Again, when no certainty or specifics are offered on a full plan how are the people who are paying the bills to believe that any of it is really going to take place?

There has been some mention of KSL coming to town recently to look over the plans CCA developed a few years ago to overhaul the entire facility. Obviously those plans made by Brookhaven Country Club management, which included a complete redo of one of the three courses, a new clubhouse and needed golf member facility, were just an effort to keep the members from knowing that the company was being sold. So how can anything they say they aer going to do be trusted?

All of this deception makes anything KSL or Club Corp say to be looked at as being very suspicious and untrustworthy. Again, another mistake made by a company that claims to be a leader in the golf industry.

Meanwhile, the property owners that circle the aging facility are left holding the bag with deflating property values for their homes. Little signs of disrepair are starting to show up on the course like large tress dieing and many being cut down with no replacements being made. If this keeps up the golf courses will look like open pastures. These actions shows potential home buyers that maybe the golf course will not remain a golf course much longer.

Brick wall entry way crumbling and hordes of people walking the golf course with their dogs all provide uncertainty in the Brookhaven neighborhood housing market that prudent investors may not think buying in a home in this community is a very good idea.

The vague announcements KSL is making to the public on their plan to put $142 million back into the CCA business came with no specifics of where or for what it will be spent on to improve. As anyone who has paid for the construction of a doghouse knows, $142 million would be swallowed up by any project that brings Brookhaven Country Club up to a minimum standard of quality.

Where does that leave the other clubs who also are in need of being updating? And, what did this announcement tell all CCA members?

A disgruntled climate amongst the membership of the club is heating up each day that goes by and there is no announcement of any specifics CCA and KSL are going to make to the club’s facilities. I am sure the membership would like to think that whatever is going on in the back rooms of these companies is going to be positive for the stakeholders. One can only hope that the smart thing will be done, but the longer there is no announcement the more rumors will feed the negative things that could happen.

Here at Brookhaven some of these negatives could be the selling off of the properties to the city to run as a municipal facility. The club manage has said this will not happen, but they also are trying tell us that they are not shrinking the greens on the golf courses.

Selling off the land of one of the golf courses to pay for the upgrade of the other golf courses is in the rumor mill. Since one of the courses has major water drainage problems this might not be too far off from being true.

Or just selling off each club in CCA to recover the cost of the sale of CCA to KSL all could be remote but very possible reality.

One thing that CCA and KSL have forgotten and that is the members of all of the clubs became members of the CCA clubs so they could enjoy quality services at a quality facility. A few years ago that was the true, but today that is not happening.

The members of CCA are not stupid as KSL and CCA seem to think they are and since these members have the income that affords them the opportunity to pay for a country club membership, I am sure many are looking at the crumbling cart paths, sewer back-ups in the parking lot, doors falling off hinges, the worn out furniture in the dining rooms as things that cause them to ask themselves what are these increased prices they now are going to have to pay going to improve.

These same members are not blind to the corporate pillaging KSL is indulging in with pulling out the very profitable Barton Creek and Homestead and other resort properties of the CCA stable and placing them squarely in the KSL owned resort groups. This move leaves the CCA identify to managing the very small profit margin driven private clubs.

What is taking place with all of this deception KSL and CCA is providing is what I warn my clients will happen if all of the stakeholders of their business are not immediately communicated what the plan is for the business. I find it appalling that a company with the resources theses two business have at hand is unable to host a dinner and sending invitation to the entire membership to attend a presentation of the entire plan they are going to put immediately in place.

That would have been the solution to avoiding the negative assumptions that are growing amongst the membership and communities towards the KSL purchase of CCA.

Maybe the reason KSL has not been able to make the announcements is that they also are not able to afford the recent increases made on all of the services. It simply amazes me that doing something as simple as letting the members know how they are going to be treated cannot be done….or did the members just get that announcement in their bill this month?

I am sure this story is far from over…so stay tuned.