The Pellucid Perspective - June 2024 - 16

MARKET FOCUS
Pinehurst NC, host of upcoming US Open, destination
golfer-driven with a " side " of local golfers
Pinehurst, NC
Core Business Statistical Area (CBSA)
I
n this monthly section we profile one of the 200+ Core Business
Statistical Areas (CBSAs) This month we'll focus on
the " unusual " golf market of Pinehurst, NC which will host
the upcoming US Open. This will give us the opportunity to
highlight one of the unique features of our Golf Local Market
Analyzer (GLMA) to give directional guidance on how much
local vs. non-local (both tourists and " commuters " (non-local day
trips) play exists in any given geography.
Looking at the market profile measures (above table), we
see that the market has a local golfer consumer base of...just
~8K golfers (this is local, resident population, that would support
~2 golf courses in any other local play-driven market).
The local golfer base is served by a (overwhelming) supply base
of 34 18-hole equivalent (EHE) facilities (that's nearly the
equivalent of the Louisville KY market which we profiled last
month). This non-tourist view of the golfer/courses balance
suggests it's way out of whack with only 222 golfers per EHE
(16 Index vs. Nat'l Avg). What you don't see in the above
table is the projected local population-driven annual rounds
which is ~206K. Comparing that to the Facility-reported
rounds (which you can see in above table) of 1.3M, there is
obviously considerable tourist and non-local golf being played
here in the neighborhood of 1.1M rds/yr. Put another way,
~85% of annual market rounds are non-local in nature. While
I wouldn't necessarily use these numbers as the crucial support
for a bank loan, it's a better estimation and methodology than
anything else currently out in trying to quantify the impact of
tourist play in this destination market. Looking at the map
three things stand out: There's been significant supply contraction
since '15 (the black hexagons), the market is heavily
weighted to high-end golf (both Public-Premium and Private,
blue and red stars respectively) and there's no municipal golf
on-ramp in Pinehurst (lack of any green icons).
The Private/Public supply mix across Pellucid's five access/
value/usage segments, at 30%/70% (dominated by Pub-Premium
golf) is surprisingly similar to the national distribution
of 28%/72% (107 index). The balance between Value-added
golf supply (Private & Public Premium) vs. Value golf (Public
Value, Price and Learning & Practice) is 81%/19% which
is incredibly tilted to Value-added golf vs. the US average of
49%/51% (165 index, all due to Public-Premium development
around resort golf). Remember also that we establish the
Premium/Value/Price segments by individual market so that's
factoring in differences in cost of living/cost of golf as we cross
markets (unlike industry trade associations' classifications
where Manhattan NY has the same price segmentation as
Manhattan KS, go figure). Within Public-Regulation golf, the
16 The Pellucid PersPecTive
Golfer Base
- Est. # of Golfers (Ks)
- # of 18 Hole Equivalent Facilities
- Golfers per 18-Hole Equiv.
Supply Mix
Tot. Holes
- Private
- Pub-Prem
- Pub-Val
- Pub-Price
- Learn & Prac
Rounds Demand & Facility Velocity
Tot. Facility-reported Rounds
Pinehurst, NC
CBSA Tot US
8 21,065
34 15,242
222 1,382
Index
vs. US
16
579
30% 29% 103
51% 22% 232
3% 23%
14% 17%
2%
9%
- Avg. Ann Rds Velocity (Ks, per EHE)
- %Utilization Rate (Fac. Vel/Cap. Rds)
1,301,126
38.2 32.4
52% 54%
Above average level vs. US (Index >105)
Average level vs. US (Index 95-104)
Below average level vs. US (Index <95)
13
82
22
118
96
Private
PubPremium
FPROF
PubPremium
MUNI
PubValue
FPROF
PubValue
MUNI
PubPrice
FPROF
PubPrice
MUNI
Learning
&
Practice
distribution
between Premium/Value/Price is 75%/4%/21%
which skews to the Pub-Premium segment vs. national distribution
of 32%/35%/32% (234 index for Premium).
Looking at the productivity of the average facility in the
market, using our proprietary Velocity measure (Annual
Rounds per 18-hole equivalent), shows ~38K rounds per year
which exceeds (118 index) the Tot. US All Facilities average
of 32K. Applying our industry-exclusive Utilization measure
(played rounds/capacity rounds), we see slight underperformance,
after weather adjustment, of 52% vs. the national averJune
2024
Closed
The Pellucid Perspective - June 2024

Table of Contents for the Digital Edition of The Pellucid Perspective - June 2024
