02212012 GOLF COURSE PRESENTATIONCity of Virginia Beach Golf Course
Operations 2009, 2010, & 2011
Performance Update
Kevin Bennington, Golf Course Coordinator
February 21, 2012
The Beginning of a New Day in Golf
Five Courses -Three Partners
1.Bow Creek, Kempsville Greens and Red Wing lake
Golf Courses
Parks and Recreation provides contract oversight.
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2.Stumpy Lake Golf Course Inc.
Parks and Recreation provides contract oversight.
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3.Virginia Beach National Golf Club
Virginia Beach Development Authority partnered with
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Virginia Beach Golf Clubs LLC. The Department of
Economic Development provides financial oversight. Parks
and Recreation provides facility and maintenance
assistance.
The Benefits of Public/Private
Partnerships are Clear
In the first 12 months of the three course agreement,
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Virginia Beach Golf Management provided the City of
Virginia Beach with $342,152 in revenue based on rental
income and usage taxes.
In the past three years, Stumpy Lake Golf Course provided
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an average of $131,433 annually to the City of Virginia
Beach in lease rent and usage taxes.
In the past three years, Virginia Beach National Golf Club
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provided an average of $237,885 annually to the City of
Virginia Beach in lease rent and usage taxes.
Virginia Beach Golf Management
The City of Virginia Beach entered into a lease agreement
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with Virginia Beach Golf Management LLC. for the operation
and management of Bow Creek, Kempsville Greens and Red
Wing Lake Golf Courses on February 1, 2011. This is a ten
year agreement with the possibility of two 5-year renewals.
Virginia Beach Golf Management will pay the City of Virginia
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Beach rental of $150,000 or 10% of gross revenue, whichever
is greater.
Virginia Beach Golf Management
Virginia Beach Golf Management committed to investing
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$552,500 to provide improvements to Kempsville Greens
and Red Wing Lake Golf Courses
Fifty percent of the rental income generated with this
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partnership is placed into a golf course infrastructure and
improvement CIP account.
City of Virginia Beach and Virginia Beach
Golf Management Performance
Total Golf Rounds
Golf Course200920102011
Bow Creek29,75928,11123,984
Kempsville Greens30,22327,25732,536
Red Wing Lake30,88432,30740,797
Total90,86687,67597,317
City of Virginia BeachGolf Operations
Total Gross Revenue
GolfCourse200920102011
BowCreek$557,938$532,070$554,242
KempsvilleGreens$492,876$516,769$715,958
Red Wing$878,647$927,792$1,360,547
Total$1,929,461$1,976,631$2,630,747
Profit/Loss
GolfCourse200920102011
Bow Creek$35,728$31,008$39,008
Kempsville Greens($128,781)($194,003)$42,339
Red Wing$146,508$271,723$101,552
Total$53,455$108,728$182,899
Virginia Beach Golf Management
Course Improvements
In the first 11 months of operation VBGM has spent
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$472,000 to improve Kempsville Greens and Red
Wing Lake Golf Courses.
Kempsville Greens –cart path
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renovation and replacement, tree work,
new fence at maintenance facility
Red Wing Golf Course –clubhouse
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renovation
Stumpy Lake Golf Course
Stumpy Lake Golf Course was purchased by the City
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of Virginia Beach in 2001.
Parks and Recreation has negotiated a lease
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agreement with Stumpy Lake Golf Course Inc.
Stumpy Lake Golf Course cont’d.
The current agreement with Stumpy Lake Golf Course began on
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January 1, 2008 and will end December 31, 2017.
The agreement includes the possibility of two 5-year
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extensions.
The City will receive rental for the lease of the course based on
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10% of the gross income up to $900,000 and 12% above the
$900,000 in a calendar year.
Stumpy Lake Golf Course cont’d.
Three percent of the first $900,000 is placed in a dedicated
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account reserved for Capital Improvements for the Stumpy Lake
Golf Course.
Upon entering into the agreement, Stumpy Lake Golf Course LLC.
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agreed to invest $545,000 in course and infrastructure
improvements within the first two years.
In addition, Stumpy Lake committed to a total of $250,000 in
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improvements by the end of the contract.
Stumpy Lake Golf Course
200920102011
GolfRounds33,92734,34040,315
Gross Revenue$1,019,106$1,032,594$1,134,328
Rentpaid to the City$97,155$104,959$116,119
Taxespaid to the City$23,492$24,420$28,155
InfrastructureRe-investment from
$656,860$425,710$11,668
Partner
Stumpy Lake Golf Course Improvements
New Toro Golf Course
Irrigation System
Stumpy Lake Golf Course Clubhouse Renovation
Cart Wash Down Area
Virginia Beach National Golf Club
Virginia Beach Development Authority entered into
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operational agreement for the Virginia Beach National
Golf Club in 2007.
The initial term of the Virginia Beach National Golf
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Club agreement was for 4 years and began April 1,
2007.
The agreement has been amended to extend through
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December 31, 2015 with the possibility of one 2-year
extension.
Virginia Beach National Golf Club
The Virginia Beach Development Authority will
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receive 10% of the gross revenues as rent for the
Virginia Beach National Golf Club:
Fifty percent of rental income is
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placed in a CIP account for
improvements to the Virginia Beach
National Golf Club.
Profit sharing of 25% of net income
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over $100,000 per year.
Virginia Beach National Golf Club
200920102011
GolfRounds26,11525,99030,853
Gross Revenue$1,773,690$1,621,586$1,847,923
Rentpaid to City$192,553$155,723$198,355
Taxespaid to City$57,883$49,468$59,674
InfrastructureRe-investment from
$19,620$21,920$16,380
Partner
Total Amount of Improvements Provided
to City of Virginia Beach by Partners
Golf Course200920102011
Bow Creek Golf CourseNANA$0
Kempsville Greens Golf CourseNANA$187,342
Red Wing Lake Golf CourseNANA$284,402
Stumpy Lake Golf Course$656,860$425,710$11,668
Virginia Beach National Golf Course$19,620$21,920$16,380
TOTAL OF FIVE COURSES$676,480$447,630$499,792
We are Heading in the Right Direction
with Public/Private Partnerships for
our Municipal Golf Courses
The partnership with Virginia Beach Golf Management has
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increased gross revenue by $650,000 in the first 11 months.
The past three years, our partners have provided over $3
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million in revenue and improvements to the City of Virginia
Beach.
These public/private partnerships will ensure that self
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sustaining, well maintained golf courses will remain available
for the community’s enjoyment.
Any Questions?