The Pellucid Perspective - August 2015 - (Page 15)

Market focus New York, New York - Play it again New York NY/Newark NJ Core Business Statistical Area (CBSA) I n this monthly section we profile one of the Top 25 US Golf Markets (based on a Pellucid composite score of the golfer base, the supply level and rounds demand). Within that Top 25 universe, we then rank them based on relative health using a Pellucid weighted scoring system on 8 variables ranging from Population Growth to Estimated Profitability-per-Available Round. In this issue, we'll profile the 12th healthiest market, the New York NY/Newark NJ Core Business Statistical Area (CBSA). Hopping coasts from last month's profile of Seattle, this month we go East Coast by focusing on the New York NY/ Newark NJ CBSA, which got some publicity earlier this summer as the LPGA Tour made its first appearance at the storied Westchester Country Club. Speaking of Westchester as a part of this market, after the build-a-course-a-day movement went bust, NGF was famous for saying that Westchester County was likely the only market in the country where new development was needed due to the fact that the economic constraints of acquiring land in this area had insulated it from overbuilding. As we'll see in the analysis below, there's still an abundance of golfers for the amount of existing supply and the challenge in this particular market is being able to place the supply somewhat proximate to the golfers and, in the case of Manhattan, that's just not possible. By rounds demand (one of our 3 selection criteria for initial inclusion in the Top 25 list), the NYC CBSA ranks number 1 among US markets with facility-reported annual demand of nearly 13M rounds (Wow!). That facility-reported tally counts both local and tourist play. Looking at the golf consumer base, we see that NYC/Newark CBSA is home to a huge local golfer base of roughly 1.8M golfers (also top ranking in the US, and remember this is only local, resident population, doesn't count the tourist crowd). That golfer base is served by a relatively modest supply amount of 448 18-hole equivalents (EHE) producing a healthy ratio of roughly 3.9K local resident golfers per EHE, roughly 2.5x the national average. The supply mix vs. the national distribution across Pellucid's five access/value/usage segments skews overwhelmingly to Private at 51% of total holes compared to the national average of 27%. The Private vs. Public access balance is 51%/49%, way out of balance vs. the national average of 27%/73%. (With all the wealth here though and the cost of real estate, this is driven by market forces). The balance of Value-added golf supply (Private & Public-Premium) vs. Value golf (Public-Value, Price and Learning & Practice) is 65%/35%, which obviously skews heavily to the Value-added classification vs. the 50%/50% national distribution. Within Public-Regulation golf (which removes the huge Private bias influence), the distribution between Premium/Value/Price is 32%/46%/22% vs. the national picture of 34%/42%/24%, which reflects only a modest "bulge" in the www.PellucidCorp.com Private PublicPremium PublicValue PublicPrice Golfer Base - Est. # of Golfers (Ks) - # of 18 Hole Equivalent Facilities - Golfers per 18-Hole Equiv. Learning & Practice Tot US Index vs. US 1,761.8 22,900 448 14,672 3,933 1,561 252 New York NY CBSA Supply Mix - Private - Pub-Prem - Pub-Val - Pub-Price - Learn & Prac 51% 14% 20% 10% 5% 27% 23% 28% 16% 6% 189 62 73 60 78 8% -12% 9% -12% 86 100 -20% -21% 94 26.7 33.8 79 43% 56% $1,505.7 $1,155 $25 $19 77 130 132 Supply/Demand Balance - '00-'13 Cume Supply Growth/Decline - '00-'13 Cume Rds Demand Growth/ Decline - '00-'13 Cume Mkt Supply Dilution (-)/Absorption (+) Level* - Avg Ann Rds Velocity (Ks per 18-hole vs. ks) Rounds & GF Revenue Health - % Utilization Rate - Avg. Ann. Rev. per Public Regulation EHE ($Ks) - Revenue per Available Round (RevpAR) Future Facility * Period % Chng in Rds vs. Period % Chng in Supply + Inverse index, lower is better Above average level vs. US (Index >105) Average level vs. US (Index 95-104) Below average level vs. US (Index <95) midpoint range vs. the US benchmark. Remember that, in this particular analysis, Pellucid allows the definitions of Premium/ Value/Price to "float" across each of the markets driven by the local market price spectrum, so the absolute price of golf isn't necessarily revealed by a balanced distribution. (For reference, The Pellucid PersPecTive 15 http://www.PellucidcorP.com

Table of Contents for the Digital Edition of The Pellucid Perspective - August 2015

TOC
TaylorMade: The Golf Gods giveth and taketh away
Rise of Arcis Golf contributes to record high in industry consolidation
Teeing up some competition – PGA Tour and EZLinks Golf
One year later, Goat Hill on the road to recovery
Good customer service and communication two keys to success
July golf weather impact: A small step backwards
New York, New York – Play it again
Fathers and sons

The Pellucid Perspective - August 2015