Hollywood lakes gc

Dealerz · 13-06-2013 10:25PM #1

I'm a former member of Hollywood lakes and I just read on their website that they had a member meeting where they started accepting "confidential pledges" from members- is that what I think it is or can a current member elaborate?

ForeRight · 13-06-2013 10:27PM

Depends on what you think it is?

TheDoc · 14-06-2013 01:52PM

Dealerz wrote: »

I'm a former member of Hollywood lakes and I just read on their website that they had a member meeting where they started accepting "confidential pledges" from members- is that what I think it is or can a current member elaborate?

Don't want to go into too much details as it's not my place, but it's something that is going on in alot of golf clubs and has to do with debt write down.

What did you think it was?

Dealerz · 14-06-2013 03:01PM

TheDoc wrote: »

Don't want to go into too much details as it's not my place, but it's something that is going on in alot of golf clubs and has to do with debt write down.

What did you think it was?

For a minute there I thought it was a money grab... Phew.
I really do hope that the clubhouse that was built is not a noose around the golf clubs neck.

Dealerz · 24-07-2013 01:41PM

Hollywood lakes in receivership from yesterday

Oilbeefhooked! · 24-07-2013 07:49PM

Is this true, havent heard anything else about it??
Was looking at memberships there last year!!

The Neon Knight · 25-07-2013 04:40AM

Dealerz wrote: »

Hollywood lakes in receivership from yesterday

completely untrue. love to know where you got your info from.

Dealerz · 25-07-2013 09:32AM

Don't shoot the messenger!!
It's on this account!
@irishgolfclubs via a current member

Northcodub · 25-07-2013 12:00PM

Completely untrue to say Hollywood Lakes in receivership.
If you dont agree check web (solocheck.ie, duedil etc) all updated daily.
Rumours are killing this country

charlieIRL · 25-07-2013 12:03PM

I'm going to shut down this thread until evidence of receivership is sent to me

charlieIRL · 02-10-2013 11:23AM

Thread reopened.

golfwallah · 02-10-2013 11:33AM

Pity to see it, but an advert for sale of the course and buildings appeared in the Irish Times last week on 25th September 2013.

You can view the ad on:
http://www.dtzsf.com/Details.aspx?OpportunityID=16064

Maybe the members have organised to buy the land & buildings back (and good luck to them), but with so many alternatives around in a shrinking membership market, it's a difficult call at this stage!

Dealerz · 02-10-2013 12:43PM

The members are raising funds themselves to purchase the land and club house with additional finance from banks too.
My point is similar to yours in that there are just too many courses in such a relatively small area of north co Dublin.

Even if they are successfull I would assume there would be drastic operational changes as well as an increase in yearly subs... Why would a "mobile" existing member be bothered?

John Divney · 02-10-2013 03:21PM

Dealerz wrote: »

The members are raising funds themselves to purchase the land and club house with additional finance from banks too.
My point is similar to yours in that there are just too many courses in such a relatively small area of north co Dublin.

Even if they are successfull I would assume there would be drastic operational changes as well as an increase in yearly subs... Why would a "mobile" existing member be bothered?

They said if they were succesful in the bid, that subs would come down drastically.. They appear to have a lot of cash in an account, so a loan and a bit of organisation , etc, they might be ok. Probably need a good winter.

golfwallah · 02-10-2013 11:11PM

John Divney wrote: »

They said if they were succesful in the bid, that subs would come down drastically.. They appear to have a lot of cash in an account, so a loan and a bit of organisation , etc, they might be ok. Probably need a good winter.

That’s expecting a lot from “if, would, appear, might and probably” in 2 sentences before the work required to raise the cash from members and secure another bank loan.

And do you seriously expect other clubs in the area to stand about doing nothing, if Hollywood Lakes drastically reduces its subs?

John Divney · 03-10-2013 12:30AM

golfwallah wrote: »

That’s expecting a lot from “if, would, appear, might and probably” in 2 sentences before the work required to raise the cash from members and secure another bank loan.

And do you seriously expect other clubs in the area to stand about doing nothing, if Hollywood Lakes drastically reduces its subs?

Sure, it could be a turnip field by the new year

But they do have money in an account, and the price is 1.2m I'm no expert in banking but if it goes for lesss, which is an assumption in this market, they raise almost half, then is the debt manageable for a club like that, if they bring in more members due to lower subs?

golfwallah · 03-10-2013 07:36AM

John Divney wrote: »

Sure, it could be a turnip field by the new year

But they do have money in an account, and the price is 1.2m I'm no expert in banking but if it goes for lesss, which is an assumption in this market, they raise almost half, then is the debt manageable for a club like that, if they bring in more members due to lower subs?

The word "if" again, this time attached to the assumptions that (1) the land & buildings could go for less than the asking price of €1.2m and (2) they will be able to bring in more members with lower subs.

As regards (1) above, maybe ..... but this still leaves a lot of money to be raised from a shrinking existing membership and another loan to be raised. They also need a business plan for the next 20 years or so that is seen as viably credible to both members and their new lenders.

As regards (2) above, given that the bulk of potential new members are already in clubs, this is bound to prompt competing clubs to react to such lower subs to survive themselves.

Interesting times ahead!

Golfgraffix · 03-10-2013 09:24AM

IMO the underlying problem in attracting members willing to pay a fee that could sustain the club is its quality,

There are so many competing clubs in the area and Hollywood Lakes is bottom of the list when it comes to course quality (IMO)

If there are financial issues I don't think that lower members fees is the magic bullet.

As mentioned earlier if fees do drop if is only going to fuel this race to the bottom that is happening.

I do feel for the members but the simple fact is there are too many clubs and some need to go to the wall.

J

Derek Zoolander · 03-10-2013 09:27AM

golfwallah wrote: »

The word "if" again, this time attached to the assumptions that (1) the land & buildings could go for less than the asking price of €1.2m and (2) they will be able to bring in more members with lower subs.

As regards (1) above, maybe ..... but this still leaves a lot of money to be raised from a shrinking existing membership and another loan to be raised. They also need a business plan for the next 20 years or so that is seen as viably credible to both members and their new lenders.

As regards (2) above, given that the bulk of potential new members are already in clubs, this is bound to prompt competing clubs to react to such lower subs to survive themselves.

Interesting times ahead!

Its hard to see how an entity like this suddenly becomes viable - I doubt the club would be in receivership if it was just the capatial expentiture that was causing the issue.

They may be able to cover the initial capital spend but for a footprint that size it won't run itself for much less than a million a year - so assuming the capital is no issue - all that the new club would need is 1000 members @ 1000 per annum.... is that realistic in the current market?

Dealerz · 03-10-2013 09:36AM

Golfgraffix wrote: »

IMO the underlying problem in attracting members willing to pay a fee that could sustain the club is its quality,

There are so many competing clubs in the area and Hollywood Lakes is bottom of the list when it comes to course quality (IMO)

If there are financial issues I don't think that lower members fees is the magic bullet.

As mentioned earlier if fees do drop if is only going to fuel this race to the bottom that is happening.

I do feel for the members but the simple fact is there are too many clubs and some need to go to the wall.

J

Spot on there I think J

Dealerz · 03-10-2013 09:41AM

Derek Zoolander wrote: »

Its hard to see how an entity like this suddenly becomes viable - I doubt the club would be in receivership if it was just the capatial expentiture that was causing the issue.

They may be able to cover the initial capital spend but for a footprint that size it won't run itself for much less than a million a year - so assuming the capital is no issue - all that the new club would need is 1000 members @ 1000 per annum.... is that realistic in the current market?

Would you join a club when it's known what's happening in the background re financing?

I wonder what operational day to day changes would have to be made by the club to remain viable?

Derek Zoolander · 03-10-2013 10:39AM

Dealerz wrote: »

Would you join a club when it's known what's happening in the background re financing?

I wonder what operational day to day changes would have to be made by the club to remain viable?

my point exactly, golden bullets are few and far between - but members sometimes keep flogging a dead donkey, rather than drawing a line under a bad investment and moving on

ssbob · 03-10-2013 11:09AM

Derek Zoolander wrote: »

They may be able to cover the initial capital spend but for a footprint that size it won't run itself for much less than a million a year - so assuming the capital is no issue - all that the new club would need is 1000 members @ 1000 per annum.... is that realistic in the current market?

1,000 members is unrealistic depending on location and course quality of course but you never mentioned green fee's, for every 5,000 green fee's thats an extra €100,000 into the coffers assuming €20 green fee and no spend in clubhouse at all........

Don't know the course, never played it, but with a business manager running the place rather than a committee I am sure a sustainable business model can be found if the members could get the place at the right price!

josie19 · 03-10-2013 12:34PM

John Divney wrote: »

They said if they were succesful in the bid, that subs would come down drastically.. They appear to have a lot of cash in an account, so a loan and a bit of organisation , etc, they might be ok. Probably need a good winter.

The cash in the account is bonds from members with a dividend of 5% pa and repayment in full after 7 years. This is in effect a loan from the members and that account has in an around €200k in it at the moment. If it sells for €1.2m they still have to source another loan of €1m. Danske have called in the (circa) €3m debt and will probably get 1/3 of that back. I really can't see a bank lending €1m to a member club which has trouble attracting new members given it's location.

Shame really cos it's a nice course but these are hard times for golf clubs.

John Divney · 03-10-2013 02:42PM

Isn't the point it isn't viable at a 3m debt, like all clubs who got caught after the crash.

Which is why the land is in recievershiip, but viable at one third of that for a mortgage of around 800k to run a course with existing and expanded membership?

There must be some belief to it, as I was surprised that they did get so much money. people don't generally throw cash at lost causes.

As for the banks, what the hell were they thinking in the first place, crazy times, every GAA and golf club needed a state of the art clubhouse.

josie19 · 03-10-2013 03:03PM

John Divney wrote: »

Isn't the point it isn't viable at a 3m debt, like all clubs who got caught after the crash.

Which is why the land is in recievershiip, but viable at one third of that for a mortgage of around 800k to run a course with existing and expanded membership?

There must be some belief to it, as I was surprised that they did get so much money. people don't generally throw cash at lost causes.

As for the banks, what the hell were they thinking in the first place, crazy times, every GAA and golf club needed a state of the art clubhouse.

More likely to be a contracting membership. Currently around 450 men and 50 women in a mixture of 7 day, 5 day and lifestyle memberships. The plan is to reduce the annual sub to €1,000 for 7 day membership (€1,350 currently) which on current numbers will bring in well short of €500k per year. Probably €130k - €140k per year to service the €1m debt alone.

They have a real difficulty in expanding membership out in the sticks.

Ollieboy · 03-10-2013 03:07PM

josie19 wrote: »

The cash in the account is bonds from members with a dividend of 5% pa and repayment in full after 7 years. This is in effect a loan from the members and that account has in an around €200k in it at the moment. If it sells for €1.2m they still have to source another loan of €1m. Danske have called in the (circa) €3m debt and will probably get 1/3 of that back. I really can't see a bank lending €1m to a member club which has trouble attracting new members given it's location.

Shame really cos it's a nice course but these are hard times for golf clubs.

This is what all golf courses should do to get a write down of debt. No different to how business are re-structuring debt.

The banks made a mistake and better to have a business servicing 1 million debt that will be paid then having 3 million with a question mark on it.

After there debt write down they'll need 1.2 million a year to run the place. Should be very possible with 600/700 members. Compared to currently needing about 1.5 million.

Makes total business sense to me.

josie19 · 03-10-2013 03:15PM

Ollieboy wrote: »

This is what all golf courses should do to get a write down of debt. No different to how business are re-structuring debt.

The banks made a mistake and better to have a business servicing 1 million debt that will be paid then having 3 million with a question mark on it.

After there debt write down they'll need 1.2 million a year to run the place. Should be very possible with 600/700 members. Compared to currently needing about 1.5 million.

Makes total business sense to me.

Their restructuring business plan is setting the annual sub at €1,000 per year. The optimistic 600/700 membership will only generate €600/€700k. Green fees only generate around €60k per year.

A very big shortfall even on optimistic membership numbers (imo)

josie19 · 03-10-2013 03:19PM

Ollieboy wrote: »

This is what all golf courses should do to get a write down of debt. No different to how business are re-structuring debt.

The banks made a mistake and better to have a business servicing 1 million debt that will be paid then having 3 million with a question mark on it.

After there debt write down they'll need 1.2 million a year to run the place. Should be very possible with 600/700 members. Compared to currently needing about 1.5 million.

Makes total business sense to me.

No write down of debt here. Danske have called in the loan as they are exiting the Irish market. The Golf Club is up for sale and the members are trying to buy it at what they perceive to be a knockdown price. At €1.2m it doesn't reprent value to me.

Ollieboy · 03-10-2013 05:28PM

josie19 wrote: »

No write down of debt here. Danske have called in the loan as they are exiting the Irish market. The Golf Club is up for sale and the members are trying to buy it at what they perceive to be a knockdown price. At €1.2m it doesn't reprent value to me.

Firstly I'm not a member of the club.

If the bank accept 1 million instead of 3 million, then that's a write off on debt in anyone's language.

Nobody else will bid for the site so I reckon the final figure will be around 750k. Not sure where you get the figure of 60k for green fees, but I would expect this to around 100k.

Finally, the sub will never be 1k, more likely 1200 plus.

So 1200 x 600 =720000
Green fees = 100000
Plus bar, opens, etc.

Main aim should be keeping cost down.

1200 is a fair membership fee for any club in co. Dublin.

Remember this club had no funding issue before the 3 million in debt ie pre 2007 this time next year they will have 3 million in improvements and a manageable debt.

josie19 · 03-10-2013 05:53PM

The company that owns the land "Dahlen" is in receivership. The only way the bank gets any money is to sell. This is not a write down of debt. It is a limited company with limited assets which the receiver will sell on behalf of the bank. There's no guarantee that the members will get backing from any financial instituition. It could easily be sold as agricultural land.

As regards the annual sub: The cash being raised by the members is on the basis that the subs will be reduced to €1,000 for the next 3 years. This is in the business plan so the possibility of charging €1,200 does not exist if they use members money in their bid to buy the golf club.

Hollywood lakes gc

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