MANAGEMENT IS IN FINANCIAL CRISIS
The club's owners, General Manager and Board of Directors have to look for ways to raise revenues and lower expenses. On the revenue side, this may mean raising dues, golf fees, food and beverage fees, adding F&B minimums and even imposing annual assessments to cover operating deficits. But because a club cannot forever raise dues or ask the membership to cover operating deficits, they have to implement cost cutting measures. So they start to reduce the golf course maintenance budget, lower the number of staff members, reduce the hours of operation, change to a cheaper brand of golf cart, and generally reduce the quality of product and service to minimum levels. These short-term financial strategies may work to make the profit and loss statement look good this month or year, but in reality what they have done is to perpetuate an out of control financial equation.
The Property Owners
HOW THIS AFFECTS REAL ESTATE AND MEMBERSHIP
When the financial condition of the club starts to decline, so do the amenities. This affects the club's ability to keep existing members as well as attract new home buyers that want to join the club. If the club isn't making operational profits, capital improvement projects have to be cut, landscaping expenses are scaled back, basic maintenance services are suspended, and amenities continue to erode in both physical appearance and perception by outsiders. This feeds a downward spiral leading to an inferior club image that can quickly harm property owners real estate values, whether they belong to the club or not.
A CMP WILL HELP THE CLUB AND THE PROPERTY OWNERS
A steady and predictable stream of dues stabilizes club revenues so operating costs can be met and the club can make necessary capital improvements, whether through secured debt or capital improvement funds. This sustains the economic viability of the club and the community in a fair and equitable manner among all who benefit from the existence of the country club amenities.
A community with a financially stable club tends to attract home buyers who want a high quality social and recreational country club lifestyle. These new buyers are genuinely concerned with the lifestyle of the community and are more comfortable if the country club is supported by all the residents in the community, not just a few.