Golf Operations Assessment

For Northbrook Park District

Presented to: Ed Dalton Director of Parks and Properties

Presented by

Pinehurst, North Carolina * Dallas, Texas * Columbus, Georgia September 28, 2017

The information and findings within this report were gathered by Sirius Golf Advisors, LLC and are transcribed herein. While we reviewed the information contained in this assessment to ensure its accuracy, the Northbrook Park District is not responsible of possible errors or omissions within this report Golf Operations Assessment

CONTENTS Executive Summary ...... 11 Initial Impression ...... 11 Market Analysis ...... 12 Competitive Review ...... 13 Classic 18 ...... 14 East 9 ...... 15 Anetsberger ...... 15 Performance Analysis ...... 15 Impact of Renovations and Rebranding ...... 15 Conclusions ...... 16 Performance Review ...... 16 Customer Feedback ...... 19 Overall Customer Satisfaction ...... 19 Satisfaction Factors ...... 20 Loyalty Driver ...... 22 Other Findings ...... 23 Facilities ...... 23 Sportsman’s ...... 23 Anetsberger ...... 24 Recommendations for SCC ...... 25 Operations ...... 28 Staffing ...... 28 Permanent Teetimes ...... 29 Carts ...... 29 Fees ...... 30 Female Friendly...... 30 Food and beverage ...... 30 Merchandise Sales ...... 31 Marketing ...... 31 Anetsberger ...... 32 Latent Golfers ...... 33 Architect’s Report ...... 33

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Practice Facility ...... 33 Classic 18 ...... 34 East 9 ...... 35 Infrastructure/Agronomy ...... 35 Clubhouse ...... 38 Projections ...... 38 Scenario Development ...... 38 Assumptions ...... 39 Scenario 0: Status Quo ...... 39 Scenario 1: Minimum ...... 40 Scenario 2: Moderate ...... 41 Scenario 3: Major ...... 42 Scenario Comparison ...... 43 Discussion ...... 44 Return on Investment ...... 44 Cost/Benefit ...... 45 Alternative Funding ...... 46 Rebranding ...... 47 Cash Needed ...... 47 Phasing ...... 48 Number of Holes ...... 48 Bottom Line ...... 50 Scenario Comparison ...... 51 Overview ...... 53 Study Objectives ...... 53 Commissioner Survey ...... 54 Disclaimer ...... 57 Initial Impressions ...... 58 National Trends in Golf ...... 60 Snapshot ...... 60 Golf Participation ...... 61 Rounds ...... 64 Number of Facilities ...... 65 Renovations ...... 68

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Conclusion ...... 69 Market Analysis ...... 70 Demographics ...... 70 Sportsman’s ...... 70 Anetsberger ...... 74 Discussion ...... 74 Golf Demand...... 75 Sportsman’s ...... 75 Anetsberger ...... 76 Golf Supply ...... 77 Change in supply ...... 79 Anetsberger ...... 79 Supply and Demand ...... 80 Anetsberger ...... 81 Competitive Review ...... 82 Overall Market ...... 82 Course Closings ...... 83 Comparables ...... 84 Classic 18 ...... 85 Driving Range ...... 96 East 9 ...... 96 Anetsberger ...... 98 Performance Analysis ...... 98 Discussion ...... 100 Impact of Renovations and Rebranding ...... 101 East Nine ...... 101 Anetsberger ...... 102 Enterprise Funds ...... 102 Performance Review ...... 103 Rounds ...... 103 Classic 18 ...... 104 East 9 ...... 105 Anetsberger ...... 106 Revenue ...... 107

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Total Revenue ...... 107 Green Fee ...... 108 Cart Revenue ...... 110 Other Revenue ...... 110 Expenses ...... 113 Sportsman’s Golf ...... 113 Driving Range ...... 116 Academy ...... 116 Anetsberger ...... 117 Divisional ...... 117 Net Operating Income ...... 119 “True” NOI ...... 121 Discussion ...... 122 Customer Feedback...... 123 Overall Customer Satisfaction ...... 123 Overall Impression ...... 123 Classic 18 ...... 125 East 9 ...... 126 Anetsberger ...... 127 Satisfaction Factors ...... 127 Classic 18 ...... 127 East 9 ...... 129 Anetsberger ...... 130 Loyalty Driver ...... 131 Classic 18 ...... 131 East 9 ...... 133 Anetsberger ...... 134 Customer Referrals ...... 135 Competition ...... 135 Zip Codes ...... 136 Customer Profile ...... 136 Course Rounds ...... 137 Gender ...... 138 Age ...... 138

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Customer Segment ...... 139 Comments ...... 140 Like Most ...... 140 Needs Improvement ...... 141 Custom Questions ...... 143 Where you play ...... 143 How often do you use the range? ...... 143 How much would you pay to fund improvements? ...... 144 Opinion on the East 9 ...... 144 Do you enjoy Executive Length courses? ...... 145 Do you consider Sportsman’s when looking to book and outing or event? ...... 145 Availability of Carts ...... 146 Factors that keep you from playing more rounds at SCC ...... 147 Miniature Golf ...... 147 Family Tees ...... 148 Short Game Area ...... 148 Play without Pay? ...... 148 Importance of Improvements ...... 148 Discussion ...... 149 Facilities ...... 151 Sportsman’s Complex ...... 151 SCC Clubhouse ...... 151 Offices ...... 152 Proshop ...... 152 Food Service Area...... 153 Locker Rooms ...... 153 Miniature Golf ...... 154 Other Sportsman’s Facilities ...... 154 SCC Maintenance Facility ...... 154 Halfway House ...... 154 On Course Restrooms and amenities ...... 154 Range Building ...... 155 Cart Building ...... 155 Anetsberger ...... 155

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Clubhouse ...... 156 Maintenance ...... 156 Recommendations ...... 156 Entrance ...... 156 Parking Lot ...... 156 Clubhouse ...... 157 Operations ...... 163 Golf Operations ...... 163 Staffing ...... 163 Management ...... 169 Rangers and Starters ...... 170 Not My Job ...... 171 Permanent Tee Times ...... 171 Carts ...... 173 Quality ...... 173 Cart Quantity ...... 173 Parking Lot ...... 173 Teetimes ...... 174 Fees ...... 174 Preferred Player Program ...... 175 Female Friendly ...... 175 What needs to be done ...... 176 Food & Beverage ...... 177 The Opportunity ...... 177 What can be done Now? ...... 177 Merchandise Sales ...... 178 Physical Improvements ...... 178 Logo ...... 179 Strategy ...... 179 Marketing ...... 180 Budget ...... 181 NPD Marketing Department ...... 181 Website ...... 181 Email Promotions ...... 182

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Social Networking ...... 182 Anetsberger ...... 182 Recommendations ...... 183 Latent Golfers ...... 185 Cost ...... 185 Time ...... 185 Intimidation ...... 185 Architect’s Report ...... 187 Goals and Objectives ...... 187 Golf Course History ...... 187 Original Golf Course Architects ...... 188 East Nine and Renovations by Other Golf Course Architects ...... 191 Golf Course Renovation Basics ...... 192 Current Course Condition Analysis – Classic 18 ...... 193 Routing ...... 193 Practice Facilities ...... 194 Back Tee Length/Par ...... 205 Forward Tees Length/Par ...... 211 Routing Safety Issues ...... 212 Circulation/Speed of Play ...... 213 Design Features/Quality ...... 214 Infrastructure/Agronomy ...... 215 Greens ...... 216 Tees ...... 224 Sand Bunkers ...... 226 Cart Path ...... 230 Drainage...... 236 Irrigation ...... 239 Classic-18 ...... 239 East-9 ...... 240 Irrigation Ponds ...... 241 Anetsberger ...... 242 Clubhouse ...... 242 Cart Storage ...... 244

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Design Recommendations ...... 245 Phasing Strategies ...... 246 Anetsberger Golf Course ...... 248 Potential ...... 249 Recommendations ...... 249 Proposed Routings ...... 251 Moderate Plan ...... 251 Major ...... 252 Projections ...... 253 Assumptions ...... 253 Scenario Descriptions ...... 253 East 9 Configuration ...... 254 Scenario 0: Status Quo ...... 255 Scenario 1: Minimal ...... 255 Scenario 2: Moderate ...... 260 Scenario 3: Major ...... 263 Scenario 0: Status Quo ...... 267 SCC Rounds ...... 267 Revenue ...... 267 Expenses ...... 267 Net Operating Income ...... 268 Cash Flow ...... 268 Scenario 1: Minimum ...... 268 SCC Rounds ...... 269 Revenue ...... 269 Expenses ...... 269 Net Operating Income ...... 269 Cash Flow ...... 270 Scenario 2: Moderate ...... 270 Rounds ...... 270 Revenue ...... 271 Expenses ...... 271 Net Operating Income ...... 271 Cash Flow ...... 272

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Scenario 3: Major ...... 272 Rounds ...... 272 Revenue ...... 272 Expenses ...... 272 Net Operating Income ...... 273 Cash Flow ...... 273 Comparison ...... 274 Scenario Comparison ...... 275 Discussion ...... 277 Return on Investment ...... 279 Net Present Value ...... 279 Total Return ...... 279 Alternate Funding ...... 280 Revenue Bonds ...... 280 General Obligation Bonds ...... 282 Lease ...... 282 Sponsors ...... 283 Grants ...... 284 Recommendations ...... 285 Phasing ...... 286 Academy and Range ...... 286 Management Options ...... 287 Self-Managed ...... 289 Leasing ...... 291 Outside Management ...... 294 Pass- Through ...... 296 Hybrid Contract ...... 296 Discussion and Recommendation ...... 300 Rebranding ...... 302 Appendices ...... 304 Appendix A: Demographics ...... 305 Sportsman’s ...... 305 Anetsberger ...... 317 Appendix B: Comparable Courses ...... 326

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Classic 18 ...... 326 East 9 ...... 342 Anetsberger ...... 345 Appendix C: Impact of Renovations ...... 349 Impact of Renovations ...... 349 Appendix E: Performance ...... 356 Rounds ...... 356 Revenue ...... 359 Expenses ...... 368 Appendix F: Customer Feedback ...... 380 Satisfaction Factors ...... 380 Customer Profile ...... 382 Factors that keep you from playing more rounds at the course ...... 385 Family tees ...... 387 Importance of Specific Improvements ...... 389 Appendix G: Financial Projections ...... 392 Scenario 0: Status Quo ...... 392 Scenario 1: Minimal ...... 409 Scenario 2: Moderate ...... 425 Scenario 3: Major ...... 442

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Sirius Golf Advisors, LLC (“Sirius”) was hired by the Northbrook Park District (“NPD”) to do an overall assessment of their golf operations, including the facilities at Sportsman’s Country Club (“SCC”) and at Anetsberger (“AGC”). The Sirius team included John Wait, President of Sirius and an expert in municipal golf facilities, noted golf course architect Jeffrey D. Brauer, and top agronomist, Peter Dejak. In addition to our examination of the facilities, we interviewed all course managers and most of the staff, met with the NPD Commissioners and with various stakeholder groups, and visited over 50 of the competitors. In addition, Sirius conducted a web-based customer survey as well as a survey of the competition. We also received and analyzed area demographic and golf demand data supplied by the National Golf Foundation (“NGF”). Because of the massive amounts of data reviewed, in the interest of time we will only discuss the most salient findings and recommendations in this section. Sirius will be focused on what can be done to improve performance and customer satisfaction which may give the false impression that the current management team is somehow at fault. This is inaccurate as we found the management team within the Golf Division and NPD to be outstanding. We want to thank them, especially Director of Golf Greg Baron, for their tremendous assistance throughout this project. Initial Impression One of the first issues we found is that Sportsman’s Country Club (SCC) presents a poor first impression. And first impressions are difficult to overcome. Some of the main issues we saw upon our initial visit, before our interview for the RFP include: • Name: There is nothing about the name “Sportsman’s Country Club” that is favorable in today’s market. The name “Sportsman’s,” besides being inherently sexist, conjures images of a hunting club, or a multi-sports facility like Techny Prairie Park and Fields. It does not inspire impressions of golf. And “country club” is associated most closely with exclusively private clubs, which do not welcome the general public. • Sign: The sign was difficult to see, especially eastbound on Dundee. And is dated and unattractive. • Range: The range looks dated, and unattractive with all the netting. It also appeared to be too narrow and shallow and lacks modern features such as target greens. • Entrance: The clubhouse was remote from the parking lot. Not only is this unwelcoming and inconvenient, but a lot of people have disabilities that make it difficult to walk long distances. • Clubhouse: The outside of the clubhouse appears dated. It gets a lot worse once you enter. The pro shop was cluttered, with a very “unfriendly”

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counter. Then you go into the restaurant area, where you feel like you’re at a sporting event with concession windows, rather than at a golf facility located in an affluent area and that charges a premium price to play. This conflict between the image and the pricing was most striking to us. From all appearances prior to going on the course, SCC “feels” like a low-end municipal golf course, with the exception of the attended bag drop. Market Analysis We examined the market demographics around both SCC and AGC, looking at 15- , 30-, and 60-minute drive times, as well as the metro area. An overwhelming majority of the play at both facilities comes from within the 15-minute area. The demographics of the area are very favorable for golf. But they are also changing. There is a steady increase in the area’s Asian population, plus the area’s population as a whole is aging. The fact that there is an increasing number of seniors is actually good for the short-term since they tend to play a lot of golf. But it does cause concerns for the long-term as the seniors age out of the marketplace. We found that golf demand was particularly strong in this area. The chart below provides index values comparing the local golf participation to national participation. The national figures have an index value of “100”. A value of 110 means 10% more than the national, while 90 would mean 10% below the national average. Demand Indices (National = 100) Travel Time of 15 Travel Time of 30 Travel Time of 60

minutes minutes minutes Golfing Household Participation Rate 157 122 121 Seasonal Golfing Households 33 18 21 Latent Demand/Interested Non-Golfers 110 121 112 Rounds Potential per Household (resident 149 107 108 golfers) Estimated Course Rounds per Household (in- 153 67 68 market supply)

We then looked at the supply of golf holes in relation to the demand. Golfing Households Per 18 Holes Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro minutes minutes minutes # Index # Index # Index # Index Total 1,119 93 2,014 167 2,036 168 1,868 154 Public 2,238 135 3,629 219 3,057 185 2,731 165 Public: Daily Fee 13,105 15,491 7,290 5,487

Public: Municipal 2,698 4,738 5,265 5,438

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Golfing Households Per 18 Holes Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro minutes minutes minutes Private 2,238 50 4,526 101 6,096 136 5,907 132 Premium (>$70) 4,368 43 10,599 104 11,713 115 13,566 134 Standard ($40-$70) 8,340 210 8,756 221 6,096 154 5,253 132 Value (<$40) 10,193 258 14,917 377 12,870 326 9,798 248

One notable fact emerges when looking at this data. SCC is in the most competitive band, being in the local area and considered a “premium” public facility. The National Golf Foundation defines a Premium facility as one that charges more than $70 to play (rack rate), cart plus green fee, peak time (SCC charges a $73 non-resident rate on weekends). Premium facilities within the local (15-minute) area have an index value of 43%, meaning there are less than half as many patrons per premium golf hole in this area than the national average. However, as we get farther away from the immediate area, the ratio changes in favor of the premium facility. In other words, SCC needs to be able to attract golfers from more than 15-minutes away in order to have a favorable competitive environment. But as we will see, SCC does not do this very well. Note: Throughout this report we will be referring to both the Classic 18 and East 9 as “Premium” facilities. This is based on NGF guidelines and solely on the highest price-point. It is not meant as a descriptor of quality. However, consumers do make a qualitative judgement based on price alone. They are going to assume that a $70 facility is inherently better than a $30 one. SCC just happens to be in a market that is dominated by higher-priced facilities. AGC, on the other hand, is in a very good market (value) from a competitive basis. Competitive Review The sheer number of golf facilities is incredibly impressive. There are 24 courses within 5 miles of SCC (15 public), 56 within 10 miles (34 public) and 170 within 25 miles (109 public). We also note that 14 courses have closed in the last 10 years. However, poor performance was not a factor in a lot of them; they were sold for redevelopment. This has been a common national theme as the land values for courses, especially those in densely populated areas, increases well beyond the value of the golf course as a business. To get a better perspective on competition, we took a closer look at 33 courses that were deemed comparable to the Classic 18, five for the East 9 and nine for AGC. The list was formed based on their location, nature of the facility and perceived target markets.

Below are the most salient findings.

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Classic 18 • Par: As a Par 70 course, Classic 18 is at a competitive disadvantage as golfers tend to prefer the more traditional Par 72. Four of the competitors had Pars of 71, and seven had a Par 70. The rest were Par 72s. • Back Yardage: Classic 18 is at a major disadvantage when it comes to back yardage. The defacto modern standard for courses is 7,000 yards from the tips. 17% of golfers typically play from 6,600 yards or longer. Classic 18 is completely missing this market. Further, being considered a “short course” as is the case with the Classic 18, creates a negative image that hurts performance even with players who normally play 6,000 yards or less. • Forward Tees: The Classic 18 measures 5,133 yards from the forward tee, which is the tee most preferred by women. As women typically hit about 70% (or less) than men, this is equivalent to a 7,542-yard course for men! As such, it is not only overly difficult, making it less enjoyable for women, but it naturally takes women a lot longer to play. This effectively slows down the pace of play, which affects all golfers. However, SCC is not alone in disadvantaging women. Only a couple of courses in the area even come close to having equitable yardage. With new forward tees in the 4,000 to 4,400-yard range, Classic 18 (and East 9) could dominate the market for women golfers. It would also greatly improve the pace of play, a common complaint. • Food & Beverage: All the Premium courses offer beverage cart service outside and table service inside. SCC does neither. • Fees: The Classic 18 was priced close to the middle of the market. When we grouped facilities by price, we noticed potential market opportunities for the Classic 18 by moving either up (over $80) or down (below $70). However, at this time moving in either direction does not appear warranted. • Bonus Program (Preferred Player Program at SCC): Only a few facilities had programs similar to SCC’s Preferred Player Program. However, both of those had a less generous program. Performance Comparison We compared the performances of 20 facilities, although not all facilities provided the same information. For example, we had rounds information from just 14. Below is a summary of the most important findings: • Rounds: For the facilities reporting rounds for both 2015 and 2016, two had increased rounds, while seven (including SCC) declined. However, only three of 14 courses reported fewer rounds than the Classic 18. Classic 18 appears to be underperforming in the market. • Revenue: For facilities reporting both revenue and rounds, the average revenue per round was $70.13. SCC is well below average at $46.98, placing 10th out of 12 facilities. This is due in part to the absence of food and beverage and no banquet space, and the fact that half the rounds are on the East 9, which is priced at 55% of the Classic 18. • Green Fees: The two operating 27-hole facilities in the area (Village Links and Arrowhead) both generated significantly more green fee revenue than

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SCC. Village Links was at $1,800,000, followed by Arrowhead at $1,600,000 and SCC at $1,400,000. • Net Operating Income (NOI): Net Operating Income is defined as Gross Revenue less cost-of-sales and operating expenses. Non-operating expenses such as depreciation, capital investments and debt service are not included. Of the 19 operations reporting NOI, eleven (58%) reported having a positive NOI, while eight (42%), including SCC, had a loss. The Top 3 performing facilities, all with NOIs of over $500,000, have significant banquet operations. This includes neighboring Chevy Chase. East 9 The results were similar for the East 9, especially with regards to being at a disadvantage for both being short, and having too long of a forward tee. The East 9 is even longer than the Classic 18, with an equivalent yardage for women compared to men of 7,820 yards! But, again, all of the facilities in this group would be deemed “unfriendly” to women. With new forward tees, the East 9, like the Classic 18, has an opportunity to dominate this market, and greatly improve its pace of play. We did find the East 9 to be the highest priced of the 9-hole facilities, suggesting it may be overpriced for the market, especially for non-residents. Anetsberger Facility-wise, AGC was consistent with the other facilities in the Par 3 marketplace. However, it had the second-lowest revenue among the six facilities reporting. AGC is underperforming in the marketplace. Performance Analysis We grouped those 20 facilities comparable to the Classic 18 for which we had performance information. We looked at Par, Household Income for the city in which the facility was located, back yardage, peak fee, food & beverage (F&B) revenue and Google rating. • SCC was in the lowest performing group in terms of percentage of facilities with a positive NOI in all but one of these groupings. In the one area in which it wasn’t the lowest, it was second lowest. • The factors that seemed to correlate strongest with performance were peak fees, yardage, and F&B income. Impact of Renovations and Rebranding Sirius did a study in conjunction with NGF, on the impact of renovations and rebranding. The study, reproduced in Appendix C, showed that municipal facilities that had significant renovations increased performance substantially after the renovations. However, by far the biggest impact was when the renovations were packaged with rebranding efforts.

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Conclusions All three courses, the Classic 18, East 9 and AGC, are underperforming in the marketplace. The Classic 18 needs to be stretched at both ends, becoming longer from the back tees and shorter from the forward. The East 9 desperately needs to be shorter from the forward. The East 9 may be better if repositioned at a lower fee structure, especially for non-residents. A strong F&B program, especially one with banquet spaces, has proven to be a ticket for success in this market. And SCC has advantages over the other facilities in terms of location. We recommend adding Foot Golf to AGC. Given the prevalence of soccer fields at Techny Prairie Park and Fields, the market is already onsite. Performance Review Below are the important findings: • Weekend Rounds have declined, which is troubling as these are the most lucrative. Weekend Rounds have a substantially higher yield than weekday rounds on the Classic 18, averaging $42.63 in green fees compared to $24.89. This clearly illustrates the importance of weekend play. • Discount Card Holders, which are both residents and non-residents, accounted for over half the rounds (52%). The percentage has increased over the past three years. • East 9 is trending better than the Classic 18. • Revenues had been trending up until FY2015-16, then slipped last year. But overall have been very stable. Revenue per round has improved each of the last three years, helping negate the loss of rounds over the same time frame. 4 Year Revenue History FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 Average Sportsman's Golf $1,988,936 $2,004,396 $2,057,978 $1,966,047 $2,004,339 Range $267,889 $285,026 $281,421 $251,139 $271,369 Academy $260,661 $279,213 $298,339 $364,832 $300,761 Anetsberger $128,068 $129,704 $122,254 $125,937 $126,491 Other $23,815 $22,891 $3,024 $13,431 $15,790 Total $2,669,369 $2,721,230 $2,763,017 $2,721,385 $2,718,750

• The Academy has, by far, had the strongest growth over the past three years, increasing 40% over this time. • Cart usage is very low for both the Classic 18 and East 9, indicating a high percentage of walkers. Carts were rented for only 48.25% of the 18-hole play and just 37.4% of the 9-hole play. The high percentage of walkers, no doubt, contributes to a slower pace of play.

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• Merchandise Sales are good, averaging over $230,000 over the past four years (about $4/round). Most Premium courses, though, average $8 or more per round. The difference is that Sportsman’s does not sell facility logoed merchandise due to the lack of a marketable logo. Furthermore, at about 77%, the cost-of-sales is very high. We normally expect around 70-72%. Again, the lack of logoed merchandise, which has a high profit margin, may be partially to blame. SCC does do a good job with hard goods such as clubs. • Driving Range: The driving range has clearly out-performed similar facilities, averaging $262,000 over the past four years, although last year it slipped to $225,000. This is impressive, given the relatively poor quality of the range. • Payroll: Golf Operations payroll is higher than expected. Contributing to this are the inefficiencies created by the facilities’ deficiencies. For example, the remote driving range requires a secondary building and sales center. The remote parking, along with a policy against carts in the parking lot, means having an attended bag drop. • Course Maintenance: Course maintenance has averaged $740,000 in expenses over the past four years. This is, if anything, low, especially for a department that is maintaining 36 holes of golf over two facilities. • Net Operating Income: Overall, the Golf Division has averaged an operating loss of $72,409. This has been improving in each of the past four years, going from a loss of $178,747 in FY14 to a loss of $72,915 last year. This is an improvement of $105,832 or 59.2%.

The table below shows the NOI for each aspect of the Golf Division, when we allocate divisional expenses prorated to each department based on percentage of revenue. Net Adjusted Operating Income FY 2013- FY 2014- FY 2015- FY 2016- Average 14 15 16 17 Sportsman's Golf Revenue $1,988,936 $2,004,396 $2,057,978 $1,966,047 $2,004,339 Cost of Sales $162,713 $184,267 $192,648 $176,773 $179,100 Expenses $1,987,237 $1,973,699 $1,963,057 $1,963,059 $1,971,763 Net Operating Income ($161,014) ($153,570) ($97,727) ($173,785) ($146,524) Driving Range Revenue $267,889 $285,026 $281,421 $251,139 $271,369

Cost of Sales $29 $148 $0 $0 $44 Expenses $139,767 $139,261 $135,160 $55,365 $138,194 Net Operating Income $128,093 $145,618 $146,262 $195,774 $133,130 Academy

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Net Adjusted Operating Income FY 2013- FY 2014- FY 2015- FY 2016- Average 14 15 16 17 Revenue $260,661 $279,213 $298,339 $364,832 $300,761 Cost of Sales $184,548 $192,727 $203,145 $156,349 $184,192 Expenses $110,152 $23,674 $28,354 $126,134 $72,078 Net Operating Income ($34,039) $62,813 $66,840 $82,350 $44,491 Anetsberger Revenue $128,068 $129,704 $122,254 $125,937 $126,491 Cost of Sales $10,175 $12,808 $11,172 $11,139 $11,324 Expenses $143,180 $122,942 $107,042 $86,607 $114,943 Net Operating Income ($25,287) ($6,046) $4,040 $28,191 $224 Divisional and Other Revenue $23,815 $22,891 $3,024 $13,431 $15,790 Cost of Sales $0 $0 $0 $0 $0 Expenses $11,124 $11,012 $6,542 $6,117 $8,699 Net Operating Income $12,691 $11,879 ($3,518) $7,314 $7,091 TOTAL FOR DIVISION Revenue $2,669,369 $2,721,230 $2,763,017 $2,721,385 $2,718,750 Cost of Sales $357,465 $389,949 $406,965 $344,261 $374,660 Expenses $2,490,651 $2,495,374 $2,456,691 $2,450,039 $2,473,189 Net Operating Income ($178,747) ($164,094) ($100,640) ($72,915) ($129,099)

• “True” NOI: We then adjusted the total NOI for the Division, taking out that part of the $300,000 annual admin fee that does not relate to any Golf Operation expenses, then adding back the employee contributions to the health insurance which is currently going to the HR Department and not back to the Golf Division. When these adjustments are made, the Golf Division essentially broke even last year. Adjusted Net Operating Income FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 Average Stated NOI ($178,747) ($164,094) ($100,640) ($72,915) ($129,099)

Adjustments Admin Overhead fee $24,151 $21,402 $31,428 $47,182 $31,041 Est Empl Contribution $14,000 $14,000 $14,000 $13,995 $13,999 Adjusted NOI ($140,596) ($128,692) ($55,211) ($11,738) ($84,059)

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Customer Feedback With NPD’s cooperation, we administered a web-based customer survey provided by NGF. About half the questions are presented to customers on all of NGF course surveys. This allows us to compare the results from NPD’s surveys to those of other courses. The other half of the questions were custom questions written by a combination of NPD and Golf Division management, with assistance from Sirius. Three surveys were administered: one each for the Classic 18, East 9 and AGC.

The comparison to the national database is essential in understanding the results. This is due to a natural bias among survey takers as well as it allows us to better judge relative performance. For example, an average answer of 7.5 on a scale from 1 to 10 where 1 is the worst and 10 is the best, may seem like a decent score – until we compare it to the national database and discover that it rates in the bottom 5% of all courses surveyed.

Overall Customer Satisfaction Measures Customer Classic 18 East 9 Anets Satisfaction Total Responses 313 108 35 We were very surprised Overall Customer Satisfaction at just how poorly the Average Score 7.6 8.3 8 three courses, Rate Band Percentile 16 40 58 especially the Classic National Percentile 33 62 41 18 fared. The results Satisfaction Compared to Expectations were compared to all Average Score 7.3 7.7 8.2 the courses in the NGF Rate Band Percentile 14 35 76 database (over 1,000), and those that are in National Percentile 21 45 81 the same rate band Satisfaction Compared to Competition (premium for Classic Average Score 7.3 8 7.9 18 and East 9 and Rate Band Percentile 13 47 68 value for AGC). The National Percentile 26 61 60 percentile score Likelihood to play more represents the Average Score 6 6.4 6.1 percentage of facilities Rate Band Percentile 25 54 9 scoring worse than the target facility. National Percentile 13 44 18 Likelihood to recommend Average Score 7.4 8.1 8 Rate Band Percentile 7 38 59 National Percentile 17 54 47

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Only Anetsberger scored above average in its rate band, although still below the national average. Classic 18 respondents put this course in the bottom 20% of all courses in its rate band. While these percentile rankings are based on comparison to the national database, we can assure the reader they are not truly representative of SCC’s position in the national marketplace. However, golfers, like most people, will base their ratings using their own personal experience. Which, in this case, mostly means other area courses. And again, SCC is in a market full of very good golf courses. So, while these rankings may not be accurate in terms of SCC’s national positioning, it is reasonable to assume they do reflect SCC’s relative position compared to the local competition. NGF has created a Loyalty Index based on the responses. They divide respondents into three groups based on their score for overall satisfaction: promoters, who gave a rating of 9 or 10; detractors, who rated 0-6; and passives, giving ratings of 7 or 8. Subtracting the percentage of detractors from the promoters gives you the “Loyalty Index.” On this measure, Classic 18 scored just 8.9%. This compares to the Premium benchmark of 44.5% and the benchmark for all courses of 24.1%. East 9 fared better at 34.2%, while AGC had 25.7%. A low loyalty score means that the facility is more vulnerable to losing its customers to the competition. Satisfaction Factors – see Appendix F We believe that these poor ratings reflect the course’s relative position in relation to the other courses your customers play – that is, the primary competition. The only factor given superior ratings for both Classic 18 and East 9, was location. Below are the most important findings: Classic 18 • Course Conditions: Classic 18 was rated in the 12th percentile (bottom 12 percent) in its peer group and 34th overall with regards to its course conditions. This is not reflective of its current conditions, but it does reflect its condition relative to its primary competition. And this is key. When we looked at the written comments, there were actually more positive comments about course maintenance than negative.. It seems to be the universal opinion that the course conditions have dramatically improved over the past five years. This was also confirmed in our personal interviews and stakeholder meetings. However, this does NOT mean it is the equal of its peers. When we asked a group of league players (about 25), they unanimously voted that Classic 18’s conditions had greatly improved. But when asked, “Are Classic 18’s conditions as good as or better than the other courses you play” only one of the 25 voted “yes.” This is due mostly to deteriorating infrastructure such as old greens, poor drainage on the course, bunkers in bad need of renovation, etc. • Friendliness/Helpfulness of the Staff: Classic 18 ranked in the 22nd percentile in its peer group (Premium) and 31st overall. Yet East 9, which

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Golf Operations Assessment Executive Summary

has the same staff, fared better (although still poorly) at the 32nd peer percentile and 46th national. We will see this rating somewhat contradicted in the comments section, where staff are praised. It does not seem like the customer service is “bad”, but rather it may not yet be on a par with the primary competition. We found a dramatic difference by looking at the people who use the course the most (league, Preferred Player Program, discount card holders) versus those that use it occasionally. The heavy users gave Classic 18 a score of 8.6, ranking it in the 40th percentile, while the light users rated it at 8.0, which puts it at the 10th percentile. This difference could indicate that staff consciously, or not, may be treating “regulars” preferentially. While this may create loyalty, it greatly hurts the ability to attract new customers. • Pace of Play ranked in the 16th percentile among peers. Women rated the pace (60th percentile) much higher than men (12th percentile). Seniors (over 60), gave a rating of 31st percentile. • Course Design/Layout rated in the 5th percentile among peers. Again, this did not match our own perception, but does strongly suggest some improvement is required. Younger golfers (under 50) gave the rating as less the 1st percentile. One of the factors that is likely contributing to this low score is the length. • Overall Experience: The average score was in the 8th percentile. Women (34%) were happier than men (6th). High users rated it much higher (7.9) than low users (6.9). Ratings were also highly correlated with age, with seniors more satisfied (8.0, 18th percentile). • Bunkers rated at 7th percentile; greens (7th percentile), tees (5th percentile) and fairways (14th percentile). In all cases, seniors were more generous than younger players, although still rating them poorly. • Condition of the Golf Carts rated in the lowest one percent. • Food and Beverage Service: Also rated at the 1st percentile for Premium courses and 2nd percentile for all course. East 9 • Course Conditions: Rated in the 31st in the Premium percentile, 55th nationally. This is one of the main drivers for repeat play. These are much better than for Classic 18, although the same team works on both. It reflects that the customer base is different for the two courses, with the East 9 base perhaps not as discriminating. It may also reflect the fact that the infrastructure, particularly the greens, are all newer on East 9. • Course Design/Layout: rated in the 7th percentile for Premium and 20th for national. • Amenities, which includes the clubhouse, received a very low score – putting East 9 in the 2nd percentile for Premiums and just the 8th for national.

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Golf Operations Assessment Executive Summary

• Food and Beverage Service was the lowest rated factor, rating in the bottom 1%. • Overall Experience was in the 18th percentile for Premium, 34th national. Anetsberger • Staff: Ratings for staff were favorable, in the top quartile. • Amenities: Was rated in the bottom 20% of courses. Percentile? • Food and beverage: Rated below the bottom 1% in both measures. • Overall Experience: Rated above average, at the 62nd percentile. • Affordability: Also rated well, in the top 30% of its peers and top 6% overall. • Merchandise: Rated poorly in all measures. • Course Conditions: Greens was the lowest rated, in the bottom 25%, (22), as were tees (23rd percentile). Fairways were close to average (42nd percentile), while bunkers (few though they are) rated well – in the top 20% of value courses. Loyalty Driver NGF takes the ratings for each of these factors and then plots them, taking into consideration their relative importance in determining where golfers play (based on years of collecting and analyzing data from their national surveys). The two most important quadrants are “Strength,” which are factors that are driving customers to the course, and “Must Improve” which are factors that are keeping customers from playing the course. For SCC, there is only one factor considered a “Strength,” which was loyalty, and that was borderline. On the other hand, 13 factors were in the “Must Improve” quadrant, indicating a serious weakness that impacts performance, with “overall experience” being the most important and showing the greatest weakness. These ratings indicate a facility that is struggling and in critical danger of losing its customer base.

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Golf Operations Assessment Executive Summary

Other Findings • Gender: East 9 had twice as high a How much would you pay to percentage of women respondents than the Classic 18, indicating that women generally fund improvements? prefer playing 9 holes. Classic 18 East 9 313 106 • Age: There was a paucity of younger players responding, especially for the Nothing Classic 18, where only 3% of the # 103 40 respondents were under 30 and 13% under % 32.9% 37.7% 40. This is a concern and shows a big gap $1-$3 in market penetration. We believe the # 120 49 length is one of the primary contributing % 38.3% 46.2% factors to this gap. (We recognize survey $4-6 length may have caused some sampling # 54 11 error. However, the lack of younger golfers was consistent with staff feedback). % 17.3% 10.4% Whatever it took Willingness to Fund Improvements: • # 36 6 Perhaps the most revealing custom % 11.5% 5.7% question was “how much would you be willing to pay extra to help fund course improvements?” Over two-thirds of the Classic 18 customers and nearly that many for East 9 said they would be willing to pay more if it meant improved course conditions. • Importance of Improvements: We asked customers to rate the importance of various improvement ideas. For the Classic 18 respondents, the highest rated response was “Adding a short game area,” followed by “Adding grass tees to the range,” “Improving the quality of the Classic 18,” “Improving the Greens on the Classic 18,” “Adding stalls to the range,” and “Adding target greens to the range.” For the East 9 responders, the highest rated was “Improving the quality of the East 9” followed by “Adding a short game area,” “Adding grass tees,” “Allowing carts into parking lot,” “Adding target greens”, “Adding covered stalls”, and “Renovating the clubhouse.” Facilities This section reviews the facilities within the Department, excluding the range and the golf courses, which are covered in the Architect’s Report. Sportsman’s Parking Having parking remote from the clubhouse and not allowing carts in the parking lot is detrimental to the customer experience especially to seniors and people with disabilities as handicap parking is extremely limited. It also eliminates any outside business opportunities for the restaurant inside the clubhouse.

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Golf Operations Assessment Executive Summary

Clubhouse There are many serious deficiencies with the clubhouse that are either inhibiting performance or adding inefficiencies to the operation. Chief among them: • Restaurant: The “concession stand windows” are completely out-of-place at a course in this price range. It is more consistent with low-end facilities. The lack of a bar and banquet space not only represents lost business opportunity, but can keep golf customers away as well. • Offices: All management offices are in the basement, away from staff and customers. This isolation creates an unintended “ivory tower” effect and is detrimental to customer service and operational efficiency. • Proshop: The proshop area is dated and cramped. The counter is too high. which can be intimidating to customers. Shorter customers have difficulty seeing over it. The display area is limited and spills over into a hallway, which is out of view from the staff behind the counter. • Restrooms: They are in need of updating. The locker rooms are obsolete. A gender bias is evident in that the men’s locker room has showers and the women’s does not. Miniature Golf The miniature golf course seems out-of-place at Sportsman’s. It is also an extremely plain design that is outdated. Our recommendation is to move miniature golf to AGC, where it is more consistent with the market at Techny Prairie Park and Fields and could boost performance of both the miniature golf and AGC. A much nicer course can be built that is market competitive. Cart Building Carts are stored in a dilapidated building. Much of the 11,000 sf building is not being utilized. The area where the carts are stored is extremely dusty and full of birds. Carts go in clean at night, often are dirty by morning, requiring additional cleaning (inefficiency). We recommend the cart barn be replaced. Our preference would be to include cart storage as part of a new clubhouse, with the cart storage underneath. The clear majority of the competing courses in this market have such an arrangement. Anetsberger Clubhouse The “clubhouse” at AGC is very small, with very little storage. This greatly limits its ability to help sell merchandise or food and beverage (almost non-existent currently). But the biggest issue is its location. The 1st tee is not visible from the clubhouse. This leads to control issues, which is a significant problem at the course. According to both staff and customer feedback, there are a large number of players who are not paying to play the course. And because there is only one

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Golf Operations Assessment Executive Summary staff member on duty at a time, it makes it difficult to leave the proshop in order to police the grounds. Our recommendation is to place a modular building to serve as the proshop, near the first tee, possibly where the current picnic area is located. The new clubhouse would: • Be Modular, which means it can be rented rather than built. Good quality modular designed to be proshops can be rented for $1,000 to $1,500/month, which is a lot less than the cost of building a new structure. • Be about 1,500 sf in size, which is large enough to have a good merchandise display area, as well as a small sitting area for food and beverage. • Have an office • Have a “snack bar” offering hot dogs, snack items, and beverages. • Have two restrooms • Have a deck around it The cost to bring plumbing to the site and build a deck should be $25,000 to $50,000. We further suggest that the existing proshop be converted into a concession stand that can serve Techny Prairie Park and Fields. It would only be open during peak periods and special events. Maintenance The maintenance crew at AGC must use the Parks maintenance building, which is remote from the course and adds both labor and fuel costs. There is no on-site storage for materials, such as sand and chemicals, necessitating they be brought as needed from SCC, creating additional inefficiencies. We recommend an inexpensive metal building be built on-site at AGC, with storage for most used equipment and supplies, and room for up to five carts for operations. The cost should be more than made up by the gained efficiency. Recommendations for SCC We recommend a new clubhouse be built for the facility. At the same time, we recommend a new entrance sign and a redesigned parking lot, bringing parking a lot closer to the clubhouse by removing the greenspace and relocating the retention pond. The proposed clubhouse should: • Have cart storage underneath • Be about 10,000-12,000 sf in size • Have a banquet room large enough to handle at least 200 people, preferably 300. The room should be able to be subdivided into at least two smaller rooms, making it easier to host smaller events or to host two small events simultaneously.

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Golf Operations Assessment Executive Summary

• Have a commercial kitchen • Have a bar area, configured like a sports bar • Have table service dining room with a capacity of 65 or so. • Have a private dining room, capable of seating 25-40. • Have a bridal changing room • Have at least five offices for management • Have a large deck • Have an indoor training area under the clubhouse.

Because the cart storage will be underneath, the clubhouse will be elevated relative to the golf course. This will greatly enhance the New Revenue from Golf view from the dining, Yield Qty Revenue New Tournament Golfers 1,500 banquet and proshop areas. A large deck will Average GF and CF $65.00 further enhance the Average Merchandise $7.50 clubhouse’s appeal. Total Yield per Round $72.50 Paying for the Total Revenue $108,750 New Classic 18 Golfers 2,000 Clubhouse Average GF $33.24 While a full feasibility Average CF $8.83 study for a new Average Merchandise $4.10 clubhouse was beyond Average Range $1.50 the scope of this study, Total Yield per Round $47.67 we did take a quick look Total Revenue $95,334 at its impact. New East 9 Golfers 1,500

Golf Average GF $18.14 The table above shows Average CF $3.80 the estimated impact a Average Merchandise $4.10 new clubhouse will have Average Range $1.50 on performance of the Total Yield per Round $27.54 two golf courses. Total Revenue $41,309 Grand Total $245,393 We anticipate more play, especially from non-residents. This will include both daily fee and tournament play. The latter is a high profit area that is largely underserved currently at SCC.

The total estimated impact is an additional $245,393 in annual revenue. Food and Beverage There are three ways in which food and beverage revenue will be enhanced. • Increased revenue from golfers • Non-golf restaurant revenue • Weddings and banquets

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Golf Operations Assessment Executive Summary

The latter two of these are areas of opportunity that are currently not being addressed by the existing facility. With regards to golfer income, the current operation is generating slightly over $3/round from golfers. This is less than one- third what is normal with premium facilities. A new restaurant, combined with a bar and adding beverage cart service, should get this up to $10/round or more. Given SCC’s prime location on Dundee, directly across from a large office park and off a major road, plus the general paucity of restaurants in the immediate area, we feel there is a significant opportunity for non-golf restaurant business, given that more convenient parking is created for restaurant customers. Food and Beverage Daily Avg # Annual Qty Avg Yield Total Days From Golf 65,000 $10.00 $650,000 Restaurant in-season 50 180 9,000 $25.00 $225,000 Restaurant off-season 120 180 21,600 $25.00 $540,000 Banquets $1,500,000 Total $2,915,000 NPD's share 10% $291,500

We also believe that significant banquet business is achievable with a banquet capacity of 300. We note several golf competitors are generating significant revenues, primarily from banquet sales. For example, Chevy Chase is generating over $3,000,000 in sales. In total, we are estimating annual F&B revenues of $2,900,000. Assuming that this operation continues to be leased out, and further assuming the new lease is a revenue sharing one, providing at least 10% of the gross revenue to NPD, we get an annual revenue stream of $291,500 to NPD. Combining the two revenue streams, we get $536,893 in increased revenue to NPD from the new clubhouse. Should debt financing be used, the improved cash flow will support a debt of $7,500,000, assuming 20-year amortization and interest rate no more than 3.5%. It should also be noted that if an indoor training area is built underneath as proposed, it should also have a significant impact on the Academy and allow it to become a 12-month operation. This could potentially add another $100,000 or more in annual revenue to the above equation. Interim Solutions Recognizing that a new clubhouse and parking area may be years in the future, there are several things that can be done as soon as this off-season, that we recommend, including: • Cart Path: Build a temporary cart path (probably gravel or crushed stone) going from the clubhouse down the east side of the parking lot to the range,

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Golf Operations Assessment Executive Summary

where a cart parking area should be built. This will increase range utilization (and revenue) from golfers wanting to warm up before playing. • Bar: Build a bar in the restaurant, around the concession windows. Then create a door from this area into the current serving area. We would then add table service during peak periods. • Proshop Counter: Build a new counter in the proshop. We recommend it be located in the southwest corner. It should be configured to handle three POS stations, instead of the current two, which will help with customer service during peak periods. It should also be built at a more accommodating height. • Hall: Tear down the wall between the proshop and the hallway where merchandise is currently being displayed. This will increase the sales floor and decrease the clutter. Total cost should be under $250,000. The renovations would lead to both improved revenue and increased customer satisfaction. Operations As noted previously, the golf operations are very well managed. Below are suggestions for improvements, not criticisms of the current operations. Staffing • Look at the possibility of using volunteers for rangers and or starters. • Consider reducing hours for cashiers in the afternoon during known slow periods. Utilize the assistant pros to fill in the gaps. • Consider reducing the number of Assistant Professionals, but making an additional one full-time. • Consider using non-PGA managers and supervisors • There needs to be an on-site manager at Anetsberger that is full-time during the season. • Consider cooperating with other park amenities, such as ice skating/hockey, that have opposite seasons to golf, whereby some valued golf employees/manager can have 12-month employment with benefits. • Rangers should be trained to assist in other areas, such as fixing ball-marks, as well as looking for opportunities to provide better customer service, such as helping with lost balls. • The demographics of the staff do not reflect the area. The staff is overwhelming white male. There are few women, and no Asians, which make up a sizable percentage of the local population. We recommend an effort be made to create a more diversified make up of staff, especially in customer contact positions.

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Golf Operations Assessment Executive Summary

• We noted a general attitude from staff whereby if something was not specifically part of their job description, it was not likely to get done. An example was picking up trash. Lesson Split The current lesson split, which is at best 70/30 in favor of the professional, but can be lower, especially with camps and group lessons, is less generous than the industry and area standard of 80/20 splits. A mandated 40% margin on group lessons makes it difficult to attract and retain quality professional staff and makes the pricing noncompetitive. We recommend relaxing these requirements. We also looked at the Assistant’s scheduling and could verify that the time spent by the professional staff on private lessons, camps and clinics was in addition to their 40+hours put in at the facility. Permanent Teetimes Permanent teetimes are an established custom among area golf facilities. However, they can be detrimental, especially in encouraging new business. With the current set-up, an individual or group can continuously renew a specific time, year after year. We strongly disapprove of this method. Imagine being a tax paying citizen of the area and being told that they can never play their course during the most desirable times. Our recommendations: • Reenact the lottery for time slots • Interfuse “open” teetimes at every third teetime slot. This will allow the general public the opportunity to play during these peak periods. • Consider increasing the rates for those high-demand times. • Increase the program fee. Carts The two biggest issues with carts is their quality and the inability to use them in the parking lot. Cart Quality We have never seen as much negative feedback on carts as we got from the customers at SCC. The current fleet is eight years old. In our twenty plus years of experience, we have never seen a premium facility a cart fleet over four years of age. Yet, SCC’s is currently double that. Clearly, the cart fleet is being treated the same as other equipment, trying to get the maximum use out of them. This totally ignores the fact that they are being used by customers and that it reflects on the overall golf experience and the image of the facility. While we understand a new fleet is being purchase for next year, we strong recommend that they be replaced no more than every four years.

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Golf Operations Assessment Executive Summary

Cart Quantity Currently, SCC has 85 golf carts. A typical 27-hole golf course has 108 carts, allowing two per hole to accommodate maximum load (especially for tournaments). However, given the high percentage of walkers at SCC, a smaller number can be justified. We understand the average for the area for a 27-hole facility is 97.5 carts. We recommend a minimum of 95, given you need some for rangers and for back-up. Carts in the Parking Lot Current practice is to not let golf carts into the parking lot. To compensate, SCC offers a manned bag drop area. But with only two people working, it can quickly get overloaded during peak periods. And due to the distance between the parking lot and the clubhouse, this presents a major inconvenience to customers. Needless to say, it is not a good business practice to cause significant inconvenience to your customers! We were told that because of the narrow distance between parking lanes that insurance mandated the no-cart practice. However, our investigation showed this was a recommendation, not a requirement. Further, we found at least two nearby facilities that had even narrow parking lanes, and both allowed carts in the lot. We recommend reconsidering this practice. Fees Recommendations include: • Lower the fees on the East 9. They should not be based, as they currently are, on the Classic 18. Non-resident rates should be reduced by 10% or so. • Raise the 9-hole rate on the Classic 18 course to 60% of the 18-hole rate. And encourage more 9-hole play on the Classic 18. • Preferred Player Program: Lower the bonus incentives. We recommend starting at 10% for $500 and going to 40% with a $1,600 investment. Female Friendly Make the facility more female friendly by: • New forward tees as noted previously • Increase selection of female goods in the proshop • Improve menu, adding more healthy choices • Improve the restrooms, especially on the East 9. • Hire more female employees Food and Beverage The food and beverage operation can generously be considered “substandard”. Part of this is due to the inadequate facilities, especially the “concession stand” in

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Golf Operations Assessment Executive Summary the clubhouse. But the operator also must take responsibility. We heard numerous complaints about both quality and service. And the vendor refuses to do beverage cart service on a regular basis. Beverage cart service is an expected amenity at most golf courses and at all premium-priced facilities. It is more than a profit center, is a vital customer service. And while the half-way house does help for the Classic 18, it is not convenient to the East 9. SCC is the only course in the market priced over $60 that does not offer regular beverage cart service or table service in its restaurant. We also recommend a revenue sharing lease as opposed to a flat-fee. This is fairer to both sides and can ultimately lead to significantly more revenue to NPD. Our suggested amount is 10% of the gross. Merchandise Sales The merchandise sales at SCC works out to about $4/round. While this is about twice the national average for all public facilities, it is lower than expectation for premium ones, where we expect $6 to $10 per round. We also noted a high cost of sales figure (76% compared to 70% expectation). Our recommendations: • New Logo: Currently, SCC sells no logoed shirts. This is primarily because the current logo is very poor in terms of marketability, especially for a course in this price range. A new logo needs to be designed that is just for the golf course. It needs to be appealing and look good on merchandise, especially shirts. SCC sells about one-third the number of shirts we would expect. Moreover, they get a lot lower margin because they are directly competing with retail merchants. With logo shirts, there is no competition (no one else has your logo) and a much higher profit margin. • Sales: There should always be a sale. Rotate stock in and out of the sales area. Do not just use sales to sell unwanted merchandise! Treat this as a retail store. Consider themes, such as “all Nike merchandise on sale.” You are likely to get vendor participation. • Promote: A promotion not promoted is not much of a promotion. Sales should be widely promoted – on the website, through emails, in golf cart displays, and with signage throughout the clubhouse. • Counter: Build a new proshop counter, preferably in the southeast corner. • Floorspace: Declutter. As noted before, we recommend removing the wall between the proshop and the hallway where merchandise is already displayed. • Incentives: Consider providing incentives to staff for merchandise sales. Marketing There is no factor that is more highly correlated with performance than marketing, yet it is often the first expense cut. This is because operators fail to recognize its importance. If revenues do not fall more than the marketing savings gained, the marketing was not doing the job in the first place!

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Golf Operations Assessment Executive Summary

Our recommendations: • Budget: The biggest issue is budget. The recommended marketing budget for public courses is 3% of gross revenue. This would equate to $78,000 for the Golf Division. Yet they are spending 1/20th of this. Last year it was $2,300. We recommend at least a $25,000 budget. • Website: There are several issues with the current website. o “Searchability”: A website is only good if people can find it. If you are specifically searching for Sportsman’s, you will find it, or if you’re searching for “Northbrook Golf” it will pop up. But what about golfers searching for golf courses in nearby communities? Sportsman’s is nowhere to be found. Given how close SCC (and AGC) is to these communities, this is an opportunity lost. There are techniques that can be used to increase placement on “Google” and other search engines where searches for “Highland Park Golf” and other communities plus “golf” will have Sportsman’s Golf turning up on the first or second page. o East 9: East 9 is much overlooked. In fact, when you click on “course info” only the Classic 18 appears. The Classic 18 and East 9 as well as AGC all appeal to different markets. It must be made a lot clearer that you have a product for these markets and give equal attention to them. o Range: As the range is a major profit center it is surprising it is given little attention other than prices. We do like the fact that you promote rental clubs for the range. o Leagues: There is a page devoted to leagues, which is excellent. But it fails to provide any information about them or how to sign up other than to call or email. • Social Networking o Update social networking on a regular basis. Twitter should be updated daily. Have a staff member or a member of the marketing team be responsible for daily updates. o Advertise: Social media is perhaps the most effective advertising media in today’s market, especially with the younger golfers that SCC needs. Anetsberger In addition to the modular clubhouse recommended above, we recommend: • Fencing: Add fencing around the south and west sides to discourage people walking on without paying • Supervisor: Have an on-site full-time supervisor. Anetsberger is greatly overlooked by current management.

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• Carts: We would like to see four golf carts available for customer rental. This would help increase play among seniors. • NDP Education: Educate the staff at Anetsberger about what’s going on at the park, and provide park materials. They are going to be asked anyway, they might as well know what to say! • Make More of a Priority: In general, Anetsberger is being overlooked in every aspect, from management, to maintenance and especially marketing. It is a nice facility that could get a lot more usage if it’s given a little more attention. Latent Golfers Develop strategies to attract the latent golfers previously mentioned. These include: • Cost: Lower the cost barrier by o Rental Clubs: Provide low-cost rentals to beginners at all the facilities. o Packages: Develop more beginner bundles that include equipment, lessons, supplies, range balls and green fees. • Intimidation: Reduce the intimidation factor by: o Targeted Clinics: Have and promote targeted beginner clinics for various peer groups, such as adults, women, seniors, etc. o Beginner League: Create a league just for beginner adults at AGC and/or the East 9. Have a pro participate to provide tips to players while on the course. Studies have clearly demonstrated that golfers tend to be very loyal to the facility where they learn the game. By welcoming beginners, SCC and AGC are helping secure their long-term success. Architect’s Report Below are some of the significant issues noted and potential solutions. Practice Facility ➢ Safety: Range location, combined with net height, allows a number of balls to escape and hit on Dundee Road. This is a significant liability. ➢ Range Location: Safety, convenience, adds operating costs. Losing revenue opportunity from golfers wanting to warm up before a round. ➢ Range Size: Too narrow, too short ➢ No grass tees ➢ Narrow stalls ➢ Poor lighting

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Golf Operations Assessment Executive Summary

Recommendations Best solution would be to relocate adjacent to clubhouse, where a wider, deeper range can be built. If not relocated, ➢ Add wider tee area, increasing to 45 stalls (requires moving miniature golf and range house). ➢ Improve lighting ➢ Add covered stalls ➢ Potentially add second level ➢ Create a turf tee Cost/Benefit Analysis on Moving Range Moving the range closer to the clubhouse will allow for the closing of the range house (assuming the miniature course is moved to AGC). This will save $25,000 in labor. Moving closer to the clubhouse should generate about $1/round additional revenue from existing golfers. This generates an additional $55,000 in revenue. Expanding the number of tees, will increase capacity during the busy times. This should add another $25,000 in revenue. Adding covered and heated stalls allows for play in the off-season, as well as in inclement weather during the season. This should add another $25,000 in revenue. Combined, these add $130,000 in cash flow. This would support a debt service of $1,850,000. The cost of the new range is expected to be $1,400,000 (with soft costs, about $1,680,000). However, this does not include the impact on the Academy. The Academy will also greatly benefit from the new range, especially with the indoor practice facilities. This potentially could add another $100,000 or more in revenue. In addition, the overall appeal of the facility will increase, which should add more rounds and even more revenue. Classic 18 ➢ Length: Too short from the back tees, too long from the front. ➢ Safety: A few holes and the range present safety concerns. ➢ Par 35/70: Less desirable than Par 36 or 72. Adding Length We looked at three different options: ➢ No Cost: When we measured the distance from 2 yards in front of the back edge of all tees (the accepted measure for back tee length), we get 6,404 yards instead of the 6,278 on the scorecard. Simply change the scorecard to more accurately reflect the length. ➢ Moderate Cost: Add back tees to holes 2,3, 8, 12, and 15. Reshape 11. Move 17 tee east. Add alternative tee for hole 18, Adjusted yardage: 6,548 yards. Estimated cost: $240,000.

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Golf Operations Assessment Executive Summary

➢ Reroute: Moving four greens and an additional four tees. Result: 6,700 yards. Cost $1,200,000. This yardage qualifies you to be able to host PGA-sponsored events, and makes you market competitive. Shorten As noted previously, all three nines at SCC are too long for women. This not only hurts its market appeal, but significantly slows down play. We recommend a new set of forward tees be added, averaging about 35-40 yards shorter than the current ones. The existing tees would be preserved, giving the courses five sets of tees, which is the modern standard. Routing ➢ Move tees back on hole 8 to make it a short par 4 ➢ Move the 9th tee forward or back to shorten as a par 4, or make short par 5 (Recommended, but keep back tees in place for scorecard yardage)

East 9 The East 9 desperately needs new forward tees as it is even longer than the two Classic 9s. The overall length is shorter, but this is consistent with its market. And there is no easy way to add significantly more yardage that would justify the cost. The East 9 would need to be rerouted if the range is relocated. This would include adding new holes on the existing range. The new yardage would be 3,189, which is longer than current, but short of what would be needed to add significant market share. Infrastructure/Agronomy Greens The greens have lived past their normal life cycle. They drain poorly and are contaminated with poa. The Classic 18 loses all revenue for an average of 14 days a year due to the greens being too wet (poor drainage). This is costing an estimated $70,000 in lost revenue. Three options for renovating include: ➢ XGD: Placing drainage into existing greens. Advantages: Cost – an estimated $378,000. Disadvantage: Doesn’t address other needs such as the contamination and has limited lifespan of 10 years. ➢ California Greens: Rebuild the greens using the California method, which uses less greens mix than the USGA. Lifespan: 20 years. Cost: $47,947/green, $1,160,000 total ➢ USGA: These are the most preferred. They also have a 20-year lifespan. The East 9 already has USGA greens. Cost $69,463/green, $1,460,000 total. ➢ Rebuild Complex: This is where the entire greens complex is rebuilt, including bunkers, etc., giving a completely new look to the greens. The

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Golf Operations Assessment Executive Summary

greens could be either California or USGA. Adds about $60,000 to the cost, including cart path, bunkers, irrigation, etc. Cost/Benefit Analysis Assuming debt financing at 20 years and 3.5% interest, the XGD method would create $26,500 debt service vs. $70,000 added revenue. Generating an extra $43,500/year. However, it only last 10 years, half as long as the others. The California method would create $81,500 in debt. But these require less maintenance. The combination of added revenue and less maintenance yields a break-even. The USGA method would create $105,789 in annual debt service. With the same maintenance gain as the California, it would result in a net loss of $25,000/year. XGD is initially the least expensive, but long-term, rebuilding with a sand based system is more cost-effective. Nor does it address the cosmetic issues that are important to golfers. Superintendents generally prefer USGA greens and represent the “safest” choice. But California Greens have the best return. At Anetsberger, they have pure sand greens, which drain too fast, allowing poor turf growth. They should be rebuilt with California style greens. But given the current volume, this project is of lower priority. Tees The tees on the Classic 18 are also substandard and should be rebuilt on both courses. Bunkers The bunkers are substandard on both courses and suffer from poor drainage and inconsistent surface. We also recommend reducing the number and size of the bunkers on the Classic 18 to lower maintenance costs and improve pace without affecting aesthetics or appeal. With 83 bunkers, Classic 18 has more bunkers than all but two of its competitors. We recommend the bunkers on both courses be rebuilt with “Best Billy Bunkers” lining. The cost for the Classic 18 would be $708,750 and $259,200 for the East 9. Northbrook averages 70 rainy days over a six-month golf season, and if all require a 4-person crew, 8 hours each, to fix, labor adds up quickly. At $15 per hour, that comes to $480 per day. If half of rain days require re-shoveling, the cost is $17,000. Less sand will be replaced each year, saving a similar amount for a total of $34,000/year. The recommended liners would cost $26,400 in debt service per year. We also recommend replacing the sand on the Classic 18 (but not the East 9) with a “white” sand instead of the buff colored sand now. This is more consistent with the “Premium” facility and enhances the course’s appeal. The cost difference works out to about $1,127 per year in added debt, or less than 25 additional rounds of revenue.

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Golf Operations Assessment Executive Summary

Cart Paths The existing cart paths are worn. The lack of looping cart paths also costs the facility revenue as there are numerous days in which carts are not allowed out, but walkers are. Sportsman's play logs show that course closures directly attributable to lack of cart paths average 30 days per year in-season (and probably that number again during the spring and fall). SCC averages about 381 rounds/day. Based on our survey, at least 30% of the players will not play if carts are not allowed. Using the average yield of $35.06/round in revenue, this results in a loss of $4,008 per day. In addition, another 20% or more will play, but would normally have rented a cart – a loss of $14/round or another $1,121 from these players. This results in an in-season loss of $154,000 per year. If we include off-season, the loss is at least $200,000. Replacing existing cart paths and adding continuous cart paths will cost an estimated $1,253,075 with asphalt. This creates $87,200 in annual debt versus the $200,000 in added revenue. Moreover, we believe there would be additional maintenance savings of $5,000/year, making the total benefit $112,800/year. Another possibility is to use porous paving. However, this more than doubles the cost to $2,878,275. This would create $202,000 in annual debt. Drainage There are notable drainage issues on both courses. Specific problem areas are seen on holes 13, 15 and 16 of the Classic 18. But there are low areas on seven other Classic 18 holes and several on the East 9. Because of the complexity and age of the current systems installed, we recommend a comprehensive drainage study be done by a qualified engineer. A new drainage system would cost $10,000 to $15,000 per hole. Assuming some existing systems could be reused, this could save 20% or so of the cost. A drainage fix for all 27 holes would cost an estimated $290,000, or about $20,000/year in debt. A lot of this cost would be made up for in maintenance savings from re-sodding, roping and mowing around wet areas. An intermediate solution would be to just fix the drainage on those holes that are most problematic. Irrigation The current system is 17 years old on the Classic 18 and nearing its expected life cycle, but is currently in good condition. While the Classic 18 irrigation system could last another five to ten years with partial changes/rebuilds/ upgrades, if more comprehensive routing changes are implemented, reconstructing now, rather than in a few years may be wise. Play and revenue often suffer after years of constant disruption, suggesting full irrigation replacement if and when renovating other parts of the course. On the East 9, though, the irrigation system is already at life expectancy at 27 years of age (normal is 25-30 years).

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Golf Operations Assessment Executive Summary

Problems include: ➢ No isolation valves (which allow repairs to be made without affecting the other parts of the course) ➢ Poor/inconsistent spray patterns, ➢ Poor uniformity of coverage, water waste. ➢ Need for spot hand watering, as per above. Problem getting worse. ➢ The former will become a bigger problem as the system ages, and the latter will continue to require over watering in some spots, hand watering in others, etc., as well as generally wasting water.

A total replacement will be needed within 3-5 years if not addressed sooner. As with the Classic 18, any major renovations should also include the irrigation system replacement. Storage Ponds The water storage ponds on both courses is inadequate. Current recommendations are for bigger storage ponds and higher GPM pump stations, which you should expect an irrigation designer to recommend a pump station larger than your existing 1600 GPM plant for the Classic 18. Clubhouse The estimated cost for a 12,000 sf clubhouse, plus renovating and expanding the parking is $7,878,420. Projections We made cash flow projections for four different scenarios. The projections were over a 10-year period. Detailed projections are found in Appendix G. Scenario Development While the number of combinations of different items needing renovating are endless, we felt it would be useful to create four different combinations to facilitate evaluations. They are: ➢ Scenario 0: Status Quo – This is what will likely happen if no capital improvements are made and no operational changes. ➢ Scenario 1: Minimum – This scenario includes most of the recommended operational changes, plus the minimum amount of renovations needed – based largely on the Superintendent’s recommendations. This includes XGD drainage for the greens, new bunker sand (but not complete rebuild), intermediate clubhouse improvements, new irrigation on the East 9, adding fencing at AGC. Total estimated cost $2,524,138. Because the capital improvements are not long-lasting and do not cover all the needs, this could also be referred to as the “Band-Aid” scenario.

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Golf Operations Assessment Executive Summary

➢ Scenario 2: Moderate – This adds needed length to the Classic 18 (6,548 yards), plus several other recommended improvements, including continuous cart paths, California greens on the Classic 18, new bunkers on all 27 holes with fabric liners, expanded range tee, portable tee shelter, new short game area, additional drainage work. It also expands the parking lot to the clubhouse, adds a modular clubhouse to AGC and moves the miniature golf to AGC and adds a storage building there. Total estimated cost $9,682,087. ➢ Scenario 3: Major – This includes moving the range and building a new clubhouse. It also lengthens the Classic 18 to around 6,700 yards, as well as putting “white” sand in the Classic 18 bunkers. These changes will allow the facility to be rebranded and repositioned in the marketplace. Other improvements include: upgrade bunkers to Billy Bunker, new irrigation on all 27 holes, and increased water storage/detention capacity. Total estimated cost $20,620,975. Assumptions • Phasing: Construction starts in 2019 and is done over three years, one nine at a time, starting with the East 9 and range. Clubhouse improvements in Minimum and Moderate done in 2019. Moving miniature golf, adding the modular clubhouse and building the storage building at AGC would also be done in 2019. For the major, the new clubhouse would be finished by 2022. • Operational Changes: Take effect in 2018. • Debt Financing: We assume construction costs are all debt financed using revenue bonds at 3.5% interest over 20 years. • Food and Beverage: For all but the status quo, we assume a new vendor, with a 10% revenue share lease. • Maintenance Savings: We noted in the text the maintenance savings achieved by various renovations. The projections do not reflect these. Instead, it is assumed that the budget would remain the same, with the savings being applied to upgrading the overall conditioning. • Fees: While we noted in our customer survey, the willingness to pay more for improvements, these are not reflected in the projections with the exception of the Major, which assumes both rebranding and repositioning the facility into a higher bracket ($80 range). • Conservative: We believe the projections to be conservative in nature. Construction costs are likely higher than what can be realized in a competitive bid situation and performance should exceed our projections. Scenario 0: Status Quo This scenario assumes that nothing will change. The result is the likely degradation of conditions due to deteriorating infrastructure at all three courses, leading to customer defections. This will be amplified by the reopening of Sunset Valley as well as recent and planned renovations at other area courses. Eventually, rates will

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Golf Operations Assessment Executive Summary fall to try and recover volume. Expenses will eventually be slashed, but these effect revenues more than the savings and the “death cycle” begins.

Status Quo $3,000,000

$2,500,000

$2,000,000

$1,500,000

$1,000,000

$500,000

$0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($500,000)

($1,000,000)

Gross Profit Total Expenses NOI The 10-year total for Net Operating Income is projected to be ($2,789,000). Scenario 1: Minimum Performance should jump with the operational changes in place and the few improvements that directly tie into performance. However, as with all the improvement scenarios, there will be a three-year period of heavy loss during the construction phase. This scenario does not address the irrigation system on the Classic 18, requiring more major capital expenses and course closure would be needed 5-10 years down the line. Also, the greens, which only have a 10-year lifespan with the XGD method, will also need to be redone. Performance will improve significantly initially, then level off and gradually decline as the issues not addressed become more significant. By the 10th year, performance will have declined to the point where it is now. And this does not include the major capital improvements that will be needed at least by

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Golf Operations Assessment Executive Summary this time. The 10-year total for NOI is expected to total ($1,088,000). While this is still negative it is $1,700,000 better than the status quo.

Minimum $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($500,000) ($1,000,000) ($1,500,000)

Gross Profit Total Expenses Net Operating Income

Scenario 2: Moderate The Moderate performs at a much higher level in terms of revenue and net operating income. However, the high debt service yields a negative cash flow every year. AGC performance and the miniature golf performance are greatly enhanced with the move of the miniature golf to AGC. Both driving range and Academy performance are enhanced with the range improvements.

Moderate $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 ($500,000) 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($1,000,000)

Gross Profit Total Expenses Net Operating Income

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Golf Operations Assessment Executive Summary

The improvements to the range and East 9 will allow for better performance in the second and third year of construction. And because of all the renovations, the reopening will become a much bigger deal, leading to increased performance. The 10-year total for NOI is projected at $2,418,000. This is $5,207,000 better than the Status Quo and $3,507,000 better than the Minimal. And, unlike the other two, the NOI continues to improve beyond the 10th year. Scenario 3: Major The Major makes dramatic improvement to rounds, revenue and net operating income over the other scenarios. But it comes at a very high cost. It has the worst cash flow over the 10-year period due to an annual debt service of $1,450,000. However, it will likely produce the best overall results, especially over a 20-year period. It also has the added benefit of making the golf operation, and the clubhouse operations, into 12-month revenue production. This will not only enhance revenue, but help with staff recruitment and retention.

Major $6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

$0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($1,000,000)

($2,000,000)

Gross Profit Total Expenses Net Operating Income Net Operating Income is extremely strong with this scenario as it benefits not only from extending the operation to 12-months, but also the addition of banquet sales, which are expected to be significant. Indeed, in the first year after the renovations are complete and the new clubhouse opened, we project an NOI of $1,187,000. It will also have a stronger NOI during the construction years due to the relocation of the range and the benefit of heated/covered stalls that help both range and Academy revenue. The cumulative NOI for the 10-year period is $7,700,000, which is $10,489,000 better than the Status Quo and $5,207,000 better than the Moderate.

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Golf Operations Assessment Executive Summary

Scenario Comparison In addition to looking at Net Operating Income, we also looked at Cash Flow. This includes debt service on the construction cost based on using 100% financing through revenue bonds at 3.5% annual interest over 20-years. We also include capital expenses. This includes equipment replacement and minor capital improvements and repairs. Over the past four years, capital expenses have averaged about $276,000 annually. We do not believe there will be a significant difference between the four scenarios on this item.

Cash Flow $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

($500,000)

($1,000,000)

($1,500,000)

($2,000,000)

($2,500,000)

($3,000,000)

Status Quo Minimum Moderate Major

On initial inspection, the Minimal scenario seems to be the winner. It produces the best cash flow over the 10-year period (a negative $5,753,000) And the Major appears worst, as it had the worst cash-flow over that time frame at ($8,434,000). But appearances can be deceiving. At the end of the 10-year period, if not before, the Minimal scenario will require another round of major renovations, including new irrigation and greens on the Classic 18. This will again result in closing the course, presumably over a two-year period. Not only will this be extremely costly, but it will also disrupt play substantially so soon after the previous construction. As the chart above shows, both the Status Quo and Minimal scenarios are tracking downward, while both the Moderate and Major track upwards, with the Major having the steeper upward slope. Thus, if we were to look at an extended 20-year period, the Major would be the likely winner, and by a considerable margin.

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Golf Operations Assessment Executive Summary

Discussion Using the cash flow analysis can be deceiving if the project is not 100% debt financed. As the graph below shows, there is a remarkable difference between the major and the other scenarios in terms of Net Operating Income, and Net Operating Income the difference continues $2,000,000 to grow. Thus, to the $1,500,000 degree that non-debt financing, or at least $1,000,000 revenue bonds, are not $500,000 used, the Major looks better and better. $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 As our customer survey ($500,000) shows, SCC is ($1,000,000) dominated by seniors Status Quo Minimum Moderate Major and locals. While this business is good, it is not healthy in the long-term to be so dependent on such a narrow market. SCC needs to be able to attract both younger golfers and golfers from a wider area (without losing the market it currently has). To do either of these things will require a better product and better marketing. Return on Investment We looked at two methods of determining return on investment. The first was using Net Present Value and the second was based on Total Return. We based the Net Present Value on using a 2% discount rate, with the initial investment being the cost and looking at performance based on improvement of NOI over the Status Quo. Net Present Value Construction Total ROI 10 Annual ROI Cost NPV 10 yr Yr 10 Yr Status Quo 0 ($2,367,675) Minimal $2,524,138 $1,440,669 150.9% 15.1% Moderate $9,682,087 $11,435,593 142.6% 14.3%

Major $20,620,975 $25,740,432 136.3% 13.6% All three improvement scenarios show a significant rate of return compared to the Status Quo. And while the Minimum shows the best, this again is misleading as it does not reflect the probability of needing additional capital improvements after 10

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Golf Operations Assessment Executive Summary years. If we look just at the improvement in Net Present Value compared to cost, the Major scenario shows the best gain, with a 24.8% improvement relative to the investment. Moderate is next with an 18.1% gain. The Minimum, however, shows a loss of 42.9%. In our total return analysis, we are looking at two factors: the differences in cash flow between the four scenarios and the change in market value. As a golf course broker, we can provide an estimate of market value based on remaining a golf operation. This does not include highest and best usage analysis, but assumes the operations are sold with the restriction that they must remain golf courses. In today’s market, the value of golf courses is determined largely by financial performance. The two main formulas used are a multiple of gross revenue and a multiple of Net Operating Income. For gross revenue, the multiple ranges from .8 to 1.2, depending on location, etc. We will use 1.0. For the NOI, the multiple ranges from 8 to 12 times. We will use 10x in our analysis. Total Return Current MV 10 year rev 10 yr NOI Best Total Return Status Quo $3,189,621 $2,522,057 ($6,043,119) $2,522,057 ($6,522,314) Minimal $3,189,621 $3,333,333 ($809,743) $3,333,333 ($5,609,048) Moderate $3,189,621 $4,484,761 $6,685,169 $6,685,169 ($3,283,389) Major $3,189,621 $5,867,671 $15,602,571 $15,602,571 $3,978,579 The “Best” column above refers to the highest market value based on the two formulas. The current market value is estimated at $3,190,000. Under the Status Quo scenario, this will decrease to $2,522,000 by 2027. On the other hand, the Major scenario shows a 2027 value of $15,602,000. When we add in the combined cash flow (which includes debt financing and capital expenses), we see that the Major scenario is the only scenario showing a positive total return. Cost/Benefit Within the report, we show how the following improvements easily pay for themselves, either in reducing costs or improving revenue (assuming 3.5% debt financing amortized over 20 years): • A new clubhouse (up to $7,500,000 cost) • Looping cart paths • Bunker repair • Extending the yardage on the Classic 18 • New forward tees on both the Classic 18 and East 9 • Drainage improvements • Greens rebuild on Classic 18 using California method

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Golf Operations Assessment Executive Summary

• Moving the range • Adding covered/heated stalls to range Other improvements are not as easy to isolate in their impact, making it difficult to do a true cost/benefit analysis. But they all contribute to the overall improvement in the golf experience, which will, in turn, greatly improve performance. We believe that the Major scenario provides the best long-term solution for NPD and provides a quality product that is more in line with the preferred image of the community. However, we also recognize that the clubhouse could be added to the Moderate scenario and that may work well too. We do believe that a new clubhouse is essential, although a slightly smaller one may work just as well at a savings of 10-15% (as long as it has a banquet room and the other key components outlined herein). Alternative Funding The biggest drawback to the Major scenario is its high cost, which, if 100% debt financed, creates a negative cash flow for the next 8 years, to the tune of a combined $6,500,000. (After which, though, the cash flow becomes positive for the next 12 years). The best solution then, would be to find alternative funding sources that can reduce the amount of debt financing required. Some options include: • General Bonds: As the clubhouse has benefits to NPD beyond golf, including it in a general bond funding would seem appropriate, at least to cover some of the costs. • Vendor Financing: Several vendors may be willing to foot at least part of the bill in exchange for a long-term lease (at least 15 years). This is true for not only the clubhouse, but also for the golf course, should the NPD consider leasing the operation. • Donations: Northbrook is a wealthy community, with many its citizens playing the course. A fund-raising campaign would likely be able to fund a significant portion of the costs. • Naming Rights: This has been a successful strategy for a lot of municipalities who sell the naming rights to the clubhouse in exchange for a significant contribution that will cover a significant percentage of the cost. Again, SCC’s location in Northbrook, where there are several Fortune 500 companies and other large businesses, should prove favorable. Naming rights can also be extended to individual rooms, such as the Allstate banquet facility, etc. or to the facility itself. • Customers: As noted previously, except for the Major scenario, our projections do not include an increase in fees, except from inflation. Yet in our survey, two-thirds of the customers indicated they would be willing to pay more to see these course improvements happen. However, the extra revenue generated from these increased fees would only fund a portion of the overall cost of them. The main increase in revenue comes from an

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Golf Operations Assessment Executive Summary

increase in volume. Further, we expect that the increase is more likely to come from non-residents as we already see a high percentage of Northbrook residents playing here, and Northbrook is relatively small. As non-residents pay a higher fee structure, the yield per round should improve significantly with increased volume. Rebranding As our research has demonstrated, the biggest improvement in performance comes from a combination of renovations with a rebranding of the facility. This may or may not include market repositioning (price change). We recommend a rebranding occur with any of the change scenarios. It is critical, though, for the Major, which is the only one that also includes a repositioning in the marketplace. Rebranding should include: • New Name: Sportsman’s Country Club needs to be renamed. The current name has negative connotations and the facility has apparently developed a poor reputation in the marketplace, both as a “short course” and having poor playing conditions. Renaming will help emphasize that it is a different ball game now. • New Logo: A new logo is important for SCC under any situation, but is critical to rebranding. The purpose should be to create interest and sell shirts, not including the part district as part of the logo should be considered. • Marketing: Rebranding requires an extensive marketing campaign. Without it, the rebranding effort will not work. And this means a willingness to spend money. At a minimum, this should be $75,000 and really, should be more in the first year. Cash Needed With or without improvements, the golf operation will continue to need financial support from the NPD. While the operation is currently close to break-even in terms of NOI, this does not account for the nearly $276,000/year spent on capital needs, such as equipment. While the improvement scenarios will eventually help with this cash flow deficit (and can eliminate it, depending on the degree of non-debt financing used), consideration must be given to the fact that the cash needed for the improvements is more than just the cost of construction. There will also need to be added financial support at least through the construction years. This is largely due to the fact that there is not a lot of cost-savings involved in running a busy 18-hole operation and a 27-hole operation – especially since all 27-holes still need to be maintained throughout the construction period. (Being conservative, we believe we are overstating the expenses during this time).

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Golf Operations Assessment Executive Summary

Phasing In our scenarios, we have shown the improvements to be conducted over a three- year period, with nine holes done at a time. This has proven to be the most effective method with regards to a 27-hole facility. However, given the amount of improvements needed and the total costs involved, there may be a temptation to “pick and choose” the improvements to be made now, while putting off others for the future. There are significant concerns with this notation. They include: 1. Cost: Spreading the improvements over an extended period will significantly increase the overall cost. This is due to three factors: a. Inflation: Construction costs increase over time, usually at a pace much higher than overall inflation. b. Efficiency: Considerable costs savings are realized when the various projects are done together as there are natural relationships. For example, redoing greens or tees will require redoing the irrigation to them. This can mean paying for that irrigation twice if at a later date the entire system is replaced. c. Staging: Staging for construction costs a lot of money. The more times you are requiring this to be done, the higher the overall cost for the project. 2. Consistency: When the projects are spread out over time, often different vendors may “win” the bids. This can lead to inconsistencies with the finished product. It can also lead to a lot of finger pointing down the road when things go wrong. 3. Lost Revenue: Many of the improvements require closing the course down for extended periods of time. Naturally, the more times you do this, the more revenue you will lose. Further, the more times you inconvenience your customers, the less customers you will have. 4. Marketing Impact: The biggest marketing impact, part of the rebranding effort, occurs when there is a “Grand Reopening” featuring the major changes. This will be considerably diluted if the project is in constant flux. We strongly recommend that as much as possible, the improvements be done at the same time, even if this means delaying the project a year or two to get the financing lined up. Number of Holes With 36 holes of golf, some have questioned whether NPD should reduce the number of holes. Part of the argument being that by closing down some holes, it would lead to better performance on the remaining holes. While this argument certainly has some logical merit, we do not see the need for such drastic action at this time. Our reasoning is:

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• Permanent: We are inherently opposed to using a permanent solution to a temporary situation. Our demand analysis and competitive reviews all strongly suggest that there is enough demand to support all 36 holes. We just have to do a better job of competing. • Which Nine: What nine-holes do you close? AGC produces the lowest volume, but it also has the lowest cost, and it fills a need within the community for junior golf. The East 9 would be the logical choice, yet our analysis strongly suggests that its market is very different than the Classic 18’s. So, closing it would only provide some benefit to the Classic 18, the rest of the market would simply go elsewhere. One could then argue, are we best serving the community by denying those who prefer an easier, shorter nine-hole course? • Short-term: Closing nine-holes does not address the infrastructure concerns on the remaining 27-holes. While there may be a temporary gain, it is likely only short-term and the Park District will be back in the same position it is now, only with fewer holes. • Cost-savings: Closing the East 9 would basically save about $280,000 in operating costs – mostly from maintenance savings as the rest of the operation would remain unchanged. Yet the East 9 is producing over $600,000 in revenue from green and cart fees alone, not to mention merchandise and other revenue streams. It also has essentially the same number of customers as the Classic 18. Bottom-line, the cost-savings is likely to be a lot less than the revenue and customer loss. • Alternative Use: Assuming that the East 9 is not sold, there is considerable costs involved in converting the space to other uses. Furthermore, those other uses are likely to have a negative cash-flow. Even leaving it as green- space would require maintenance costs, with no opportunity for revenue to offset the cost. Selling the East 9 It was also suggested selling the East 9 to pay for the renovations to the rest of the facility. There are two possible scenarios: selling it as a golf course, or selling it for development. Selling it for development would likely generate enough revenue to pay for most if not all the recommended improvements. It was beyond the scope of our study, though, to determine its highest and best usage and value. But there are other considerations. For example, we understand that the land may be deed restricted to remain a golf course. This can be extremely difficult to get around. From an environmental standpoint, you would be destroying a lot of green space and replacing it with non-permeable surface. From a political standpoint, you would be upsetting a lot of golfers who prefer playing the East 9, most of whom are Northbrook residents. You may also be upsetting others in the area that would not appreciate the additional traffic generated by the development.

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As a golf course broker, I can tell you about its value as a golf course. Golf courses are sold primarily based on financial performance. In the case of the East 9, the presumed market value would be around $1,000,000. Its location would be an asset. However, it would not have a clubhouse, which would be a strong deterrent. You would gain much more by simply implementing the improvements recommended without adding to the competition. Bottom Line The bottom line is that the worst scenario is to do nothing. Not only is SCC’s relative position against the competition currently weak, it is likely to only get worse. In addition to the decline in course conditions resulting from a deteriorating infrastructure, SCC will also be facing better and better competition. Next year, Sunset Valley is reopening after an extended renovation. Schaumburg is in the middle of a 3-year renovation. Several facilities have recently undergone renovations and even more are planning them. The SCC is in an incredibly competitive market full of outstanding facilities. It is clearly a situation where simply “being good is not good enough.” However, it does have the potential to be one of the very best courses in the area, both in terms of quality and performance. This is especially true with the Major Scenario, where not only the golf would benefit greatly, but the community will have a 12-month golf operation once again, and a banquet facility that would be among the best in the area.

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Golf Operations Assessment Executive Summary

Scenario Comparison The table below compares the performance of the four scenarios on rounds, revenue, expenses, NOI and cash flow. We pick two key years, 2022 and 2027. 2022 is right after the facility reopens after renovations, and 2027 is the last year of the projection period. We also look at the subtotals for the first five years, second five years and total for the 10-years.

Scenario Comparison 2022 2018-22 2027 2023-27 2018-27 Dif from Dif from Total SQ Total Dif from SQ Total SQ Total Dif from SQ Total Dif from SQ SCC Rounds Status Quo $52,075 $269,268 $45,179 $240,308 $509,576 Minimal $61,500 $9,425 $227,480 ($41,788) $57,009 $11,830 $296,921 $56,613 $524,401 $14,825 Moderate $63,000 $10,925 $228,980 ($40,288) $65,415 $20,236 $322,205 $81,897 $551,185 $41,609 Major $65,500 $13,425 $231,694 ($37,573) $68,384 $23,204 $336,781 $96,473 $568,475 $58,899 Total Revenue Status Quo $2,889,031 $14,453,630 $2,606,748 $13,646,471 $28,100,100 Minimal $3,500,760 $611,729 $13,811,303 ($642,327) $3,390,229 $783,480 $17,383,839 $3,737,368 $31,195,141 $3,095,041 Moderate $3,826,259 $937,228 $14,796,352 $342,722 $4,346,962 $1,740,214 $20,665,566 $7,019,095 $35,461,918 $7,361,818 Major $4,963,572 $2,074,541 $15,690,579 $1,236,950 $5,756,832 $3,150,084 $27,004,235 $13,357,764 $42,694,814 $14,594,714 Total Expenses Status Quo $2,680,910 $13,043,966 $2,790,768 $13,680,176 $26,724,143 Minimal $2,783,048 $102,138 $13,019,709 ($24,257) $2,930,485 $139,717 $14,317,208 $637,031 $27,336,917 $612,774 Moderate $2,866,063 $185,152 $13,328,008 $284,042 $3,134,452 $343,684 $15,110,393 $1,430,216 $28,438,401 $1,714,258 Major $3,084,991 $404,080 $13,450,784 $406,818 $3,413,830 $623,063 $16,399,232 $2,719,055 $29,850,016 $3,125,873 NOI Status Quo ($180,270) ($487,590) ($557,991) ($1,938,675) ($2,426,265) Minimal $212,263 $392,533 ($1,272,019) ($784,429) ($46,435) $511,556 $519,458 $2,458,133 ($752,561) $1,673,704

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Golf Operations Assessment Executive Summary

Scenario Comparison 2022 2018-22 2027 2023-27 2018-27 Dif from Dif from Total SQ Total Dif from SQ Total SQ Total Dif from SQ Total Dif from SQ Moderate $389,868 $570,138 ($792,488) ($304,898) $568,285 $1,126,276 $2,485,553 $4,424,227 $1,693,064 $4,119,329 Major $1,145,507 $1,325,777 ($124,551) $363,039 $1,511,852 $2,069,843 $6,646,197 $8,584,872 $6,521,646 $8,947,911 Cash Flow Status Quo ($180,270) ($487,590) ($557,991) ($1,938,675) ($2,426,265) Minimal $34,662 $214,932 ($1,982,423) ($1,494,833) ($224,036) $333,955 ($190,946) $1,747,729 ($2,173,369) $252,895 Moderate ($291,374) ($111,104) ($3,517,457) ($3,029,867) ($112,957) $445,034 ($239,415) $1,699,259 ($3,756,872) ($1,330,607) Major ($305,407) ($125,137) ($5,928,207) ($5,440,617) $60,938 $618,929 ($608,373) $1,330,302 ($6,536,580) ($4,110,315)

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Golf Operations Assessment Overview

Sirius Golf Advisors, LLC (“Sirius”) was hired by the Northbrook Park District (“NPD”) to do an overall assessment of their golf operations, including the facilities at Sportsman’s Country Club (“SCC”) and at Anetsberger (“AGC”). For this study, three primary investigators were used: John S. Wait, the President of Sirius, Golf Course Architect, Jeffrey D. Brauer, and Agronomist Peter Dejak. Mr. Wait spent a total of 13 days on-site or surveying competition, Mr. Brauer spent seven and Mr. Dejak three. During this time, we conducted interviews with Park Commissioners, all the course managers and most of the staff, various stakeholder groups, owners of the vendor providing F&B services to the course, and several customers on site. We also visited fifty plus area golf facilities. In addition, we conducted surveys with the Park Commissioners, customers of the NPD golf facilities, and of the competition. We also examined financial records and various other reports provided by NPD or golf course management. The Sirius team was led by John S. Wait, managing member of Sirius Golf Advisors, LLC who is an acknowledged leader in municipal golf operations and who has worked on over 70 golf course evaluations. He is the primary author of this report. Assisting on this project was Jeffrey D. Brauer and Peter Dejak. Jeff is one of the leading golf course architects in the nation, and is one of very few architects to have won Golf Digest’s prestigious “Best New Public Golf Course” twice. As an area native (Arlington Heights), he is very familiar with the market, especially with Sportsman’s Country Club, having worked on a project there early in his career. Peter is a well-respected agronomist who graduated top of his class at Penn State and then interned at Augusta National. Currently he owns and operates Signet Golf Associates, a golf course construction and management firm out of Pinehurst, NC. Study Objectives The RFP for the study outlined the following study deliverables:

1) Evaluate existing golf course conditions and maintenance practices being performed to include, but not limited to: overall golf course conditions and maintenance practices being employed to maintain greens, teeboxes, fairways, irrigation system, cart paths, etc.; 2) Evaluate all clubhouse operations including guest services, food and beverage operations, golf shop, practice range and miniature golf to include but not limited to; review of the fee structures / financial information and provide an analysis as well as recommendations based upon Sportsman's/Anetsberger competitive market. 3) Identify and assess Sportsman's/Anetsberger competitive market, including the physical and operating characteristics of peer facilities and local competitor golf courses. This assignment should include, but not be limited to, the following: location, type of facilities, facility characteristics, rounds played, golf rates and fees, etc.

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Golf Operations Assessment Overview

4) Identify capital improvements that will create a competitive advantage and improve revenue generation and expense management of Sportsman's/Anetsberger courses. Prioritize capital improvements as the District's objective is to improve Sportsman's/Anetsberger courses to continue to be competitive in the North Shore area golf market as well as to minimize subsidies to the golf course operation. 5) Provide an assessment of Golf Course organizational structure that takes into consideration the unique operational attributes and current industry management trends. Include comparisons to like facilities, with comparable amenities, customer service experience expectations and do so from a local and if needed national level (if an alternative is recommended for consideration). 6) The District’s goal is to produce golf revenues that cover all operating expenses without subsidies from the Park District operating budget. Provide operational change recommendations/alternative program structure for consideration that illustrates the reasonably expected result from the implementation or elimination of each alternative for the District to consider. Commissioner Survey In addition to the study guidelines provided in the RFP, we also surveyed the Commissioners, both in a formal fashion (see below) and through interviews, to get their input on the study. The formal survey results are given below. The first and most important question dealt with the mission statement for the golf course. This is a critical question as it helped shape our recommendations. Below are some of the possible answers: Amenity to the Citizens of the Community: This used to be the primary mission statement for all municipal operations until the 1990s when other options became clear. Consequence: If it is an amenity, then it should be treated like other amenities within the park system, such as parks, pools, tennis courts, etc. In other words, it is expected to be subsidized like the other amenities. Furthermore, there would also be an expectation of discounts for local citizens. Affordability for the citizens would be extremely important as would accessibility for all citizens of the community. Profitability: In the 1980s, municipalities started to discover that the golf operations could be profitable. Indeed, in many cases, the courses became so profitable that they were able to support other programs. Today, most municipalities would be happy to simply have the golf course pay for itself. However, this can be in direct conflict to being an Amenity (above). To the degree that profitability is a priority – even breaking even – then the operation needs to more closely resemble a business operation and less like a park. Not only is it a business, but it is a business in a highly competitive field. The more emphasis on profitability, the more emphasis needs to be placed on both controlling costs and maximizing revenue. To maximize profitability, many municipalities have chosen to

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Golf Operations Assessment Overview privatize the operation to one degree or another. At the low end of the privatization scale, the course becomes an enterprise fund, giving it more freedom than a general fund. At the extreme end, the course is leased out to a private company. In between are various forms of management contracts. Icon/Community Pride: For many municipalities, the golf course(s) become a source of community pride. Here the most important aspect of the operation is the overall quality of the experience. The golf operation should stand above its peers, almost as a status symbol. This can have a positive impact on the community at large, even to non-golfers. Of course, becoming a status symbol may be in opposition to the profitability priority or even the amenity priority as it may make the course less affordable. It also impacts operations as it is important that the course be maintained at the highest levels and that customer service be a high priority. Economic Driver: According to many surveys, access to quality golf is one of the top 5 questions companies ask when looking at prospective new locations. Similarly, golf availability and quality, can be an important consideration for residents relocating to the area, especially higher-income families that are more likely to play golf. The golf operation, itself, can be an economic driver, not only through its revenue generation but also as an employment source. Further, a new golf course, or significant renovations of a golf operation, can become an economic stimulus to the neighboring area, often spawning other development or redevelopment. Another opportunity is bringing nonresidents, especially tourists to the golf course with the hopes that they will spend money within the community on non-golf activities such as dining or lodging. Golf Development: Similar to the Amenity priority, Golf Development helps new and current golfers improve their game – regardless of whether they are citizens of the community or not. Priority is placed on training facilities, clinics, lessons and programming. This places a priority on physical amenities of the club, such as the driving range, short game area, etc. as well as having qualified teachers and affordable programs that open golf to new markets. Youth Programming: Youth programs, such as First Tee, summer camps, leagues, clinics, etc., become a priority. While teaching golf is a part of these programs, this may not even be a major priority of the program (such as with First Tee, which is more about teaching life lessons). Importance is given to accessibility and availability of youth programming, even at the cost of making it more difficult for adults to access the facility at various times. Here are the results: Please assign a percentage to each priority area as to the desired purpose of the golf operation Average a. Amenity to area Citizens 39% b. Profitability 19%

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Golf Operations Assessment Overview c. Icon/Community Pride 8% d. Economic Driver 4% e. Golf Development 11% f. Youth Programming 16% g. Other 3%

Other:

On a scale of 1 to 10, with "1" being a "pasture with flagpoles" and "10" being "Best municipal golf course you have experienced", please rate: Average

a. Sportsman’s Club Classic 18 Course 8.1 b. Sportsman’s Club East Course 6.4 c. Anetsberger Golf Course 6.4

On a scale from 1-10, with "1" meaning "get rid of it now" and "10" being "Must keep at all costs" how do you rate the importance of the following: Average a. Sportsman’s Club Classic Course 9.3 b. Sportsman’s Club East Course 7.6 c. Anetsberger Golf Course 8.3 d. Sportsman’s driving range 8.9 e. Sportsman’s miniature golf course 4.1

Where would you spend money to improve the facility? Please prioritize the following from 1 to 8, with 1 meaning highest priority Average a. Sportsman’s Club Classic 18 Course 3.6 b. Sportsman’s Club East Course 3.0 c. Anetsberger Golf Course 6.7 d. Sportsman’s driving range 3.6

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Golf Operations Assessment Overview e. Sportsman’s miniature golf course 4.5 f. Sportsman’s clubhouse 3.0 g. Anetsberger Clubhouse 6.3 h. Undeveloped Land 6.3 i. Other

In our interviews with the Commissioners, they tended to be in the middle of the axis “Amenity vs. Profit Center,” expressing the desire to be an amenity to the residents, but for the courses to be self-sufficient. Some included capital improvements as part of that self-sufficiency, while others did not. This is a big difference. On an annual basis, the amount of money that should be set-aside for capital improvements for the combined facilities at Sportsman’s would likely be around $300,000 to $400,000. (Over the past four years it has averaged $276,000). Since this has not been done, there are a lot of deferred maintenance items that need to be addressed as the report will show. We also found, in examining the financials, that the course is already close to achieving an operational break-even in that the operating revenues match the operating expenses when everything is taken into consideration. Yet the perception seems to be that it is losing money. We will discuss this more in the financial review. Notably, some of the Park management team were more strongly on the side of increasing the profitability with the hopes of helping support other Park programs. This is out of concern for potential property tax income reductions in the future that could jeopardize other programs. The issue of the importance of profitability is critical as it determines how the operation is seen and how it should be run. If being an amenity is the most important, then it should operate within the Park system much like other amenities such as parks, tennis courts, pools, etc., with an expectation of subsidy. But to the degree that profitability becomes a concern, then the operation needs to be run more like a business than a park… and a business that is in a very competitive industry. This distinction affects everything about the operation, from staffing to fees, to procedures, to customer service, etc. Disclaimer Because our study was focused on how the facilities and their operations can be improved, it may unintentionally reflect negatively on the current operations, management and staff. This is highly regrettable and misleading. Indeed, we found the management and staff at Sportsman’s and Anetsberger to be outstanding. Sportsman’s is one of the best-run and managed facilities we have seen in our 25 years of experience. They are not only highly competent, but they are also clearly dedicated.

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Golf Operations Assessment Overview

Initial Impressions I am not from the Chicago area and was not familiar with Sportsman’s prior to coming for the interview for this job. I would like to share my initial impressions as I believe that they represent what others are likely to see and experience when they first come to Sportsman’s. Of course, the first impression is formed upon hearing the name “Sportsman’s Country Club.” Not a single word in this name is accurate or enticing. The first word, “Sportsman’s, aside from the sexist overlay, conjures up first, the image of a hunting club; secondly an image of a multi-sport facility (such as Techny Prairie Park and Fields). It certainly does NOT bring up thoughts of golf. The words “country club” are most commonly associated with a private club. This is a negative when talking about a public facility- especially a municipally owned one. It connotes thoughts of “exclusivity” and discourages a lot of public players from wanting to play. They do not like the thought of a “snobbish” club, where they may be looked down upon or made to feel unwelcome. My next impression came when driving down Dundee for the first time and passing right by the entrance because the sign is set so far back that it was obscured by trees until it was too late to stop. Moreover, the sign itself is very dated and unappealing. It is more in line with what I would expect at a low-end municipal facility. Indeed, most of what we saw driving in that first time, was reminiscent of a low- end facility rather than one priced in the premium range and located in one of the more prestigious areas of the metropolitan area. The range was not in great condition, appeared to be too narrow and not long enough. It was surrounded by ugly nets. It had no grass tees and no target greens – staples of the modern range. The miniature golf course appeared out of place and neglected (the carpet had not been replaced when I first visited for the interview). The landscaping was nice, but the parking lot was rather unremarkable. Then we discovered we had to park about 100+ yards away from the clubhouse. This may not seem like a big deal, but given that I am partially handicapped, it was certainly discouraging for me as I would think it would be for many seniors. Jeff and I both wondered about the green space and pond in front of the clubhouse. It just did not seem to fit and certainly was a major inconvenience to the customers. (There is a saying that is appropriate: “The more you inconvenience your customer, the less customers you will have.”) The attended bag drop was a nice feature, but seemed out-of-place given everything else we were seeing. The outside of the clubhouse was unappealing and dated. And then we walked in. The proshop featured crowded displays jamming up the walking areas, making it appear more like a bargain basement than a high-end proshop. The merchandise spilled over into a hallway that appeared to have no other purpose. The counter

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Golf Operations Assessment Overview was huge and very tall. My wife would have had a very difficult time peering over it. Next, we went over to the “restaurant” area. I am putting “restaurant” in quotes because it seemed more like a snack bar or cafeteria than the restaurant/grill/bar one would expect in a higher-end facility. One had to go to a window to order food, then sit in an area with a view of the golf course limited to a practice green and a teebox (a nice, but very limited view). The space itself, though, was unremarkable and unappealing. So, besides the bag-drop area and some of the landscaping, everything I had seen up to this point was consistent with a low-end facility, creating a negative impression in my mind. These negative first impressions create a low set of expectations for the course; in other words, you are climbing out of a big hole in order to create a favorable over-all impression. Fortunately, the rest of the experience was much better. We found staff to be very pleasant and the Classic 18 to be very nice. However, the East 9 appeared to be qualitatively below the Classic 18. So much so that we were surprised to learn that it was priced essentially on an even level with the Classic 18. The point of all this is to say that when one looks at the $73 weekend fee (non- resident with cart), one expects a facility to present a much nicer curb appeal and amenities. This market inconsistency no doubt hurts the business. The inconsistency becomes even larger when one considers the prestige of Northbrook.

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Golf Operations Assessment National Trends in Golf

This section is based on information supplied by the National Golf Foundation. The golf industry has certainly slowed down from its golden days that lasted from the 1980s through the turn of the century and especially during the period 1993-2001. There are three basic measures that are commonly examined with regards to the popularity of golf: • Golf Participation: How many people are playing golf • Number of Rounds: How many rounds of golf are being played • Number of Facilities: How many golf facilities are there. All three of these measures peaked during the first decade of this century and have been declining more or less since then. This decline has led to many Chicken Little wannabes to shout, “the sky is falling” or rather “golf is dying.” However, to paraphrase Mark Twain, “the news of (golf’s) death is greatly exaggerated” as a closer examination of the facts will reveal. For one thing, golf has been around for 500 years. It is not likely to disappear overnight. In fact, world-wide, the sport is growing as its inclusion in the most recent Olympics illustrates. Economically, golf’s influence in the U.S. is huge. The industry generates over $70 billion, employs nearly 2 million and produces about $55.6 billion in wage income. An estimated 81 million people, including 62 million non-golfers, watched golf on TV last year, while 27 million read about golf. In total, an estimated 95 million Americans – one out of three – either played golf, watched golf or read about golf last year. So, interest in golf is still strong. It is true that golf participation, rounds, and number of facilities have declined over the past 10 years. However, they are still higher than at any time in history prior to 1995. It is also important to note that there are as many people who express an interest to take up golf but who do not currently play as there are current players. Let’s look at each statistic in turn. Snapshot The table below provides a snapshot of changes in the golf industry over the past five years. In it we can find reasons for both optimism and pessimism. On the positive side, the pace of golf course closings has slowed significantly, while the number of openings has increased. Overall, the number of rounds has fallen over the five-year period, but they have gone up each of the past two years. The number of golfers, though, has steadily decreased.

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Golf Operations Assessment National Trends in Golf

Golf Snapshot 2012 to 2016 2012 2013 2014 2015 2016 Golf Course Inventory 15,619 15,516 15,372 15,204 15,014 (yearend) 18-hole equivalents 14,671.5 14,564.5 14,437.0 14,288.5 14,117.5 Golf Course openings 14 10

18-hole equivalents 13.5 14 10.5 17 15.5 Golf Course closings 203 95

18-hole equivalents 154.5 157.5 174 177 81.5 Golf Course renovations 41 38 42.5 41 37 Rounds overall (in millions) 489.5 465.5 457.6 465.8 468.6 Number of golfers (in 25.3 24.7 24.7 24.1 23.8 millions) Junior golfers (in millions) 2.7 3 3.2 3 2.9

Golf Participation According to the National Golf Foundation (NGF), which is the acknowledged leader in golf research, 24.1 million Americans played golf last year. (This includes those who played at alternative facilities such as Par 3 courses). This number is down slightly from the 24.7 million estimated in each of the previous two years. It also represents a decline of 21% since the peak, which was 30.5 million in 2003. However, it is also higher than any year prior to 1995. There certainly are several factors that influence golf participation. Among the most salient are: • Economy: Golf is not an inexpensive sport. Golf participation is highly correlated to the economy. • Access: It may be a bit of the “chicken and egg,” but if it is difficult to find a facility where you can play – especially learn to play – then you are less likely to play. Golf participation and the number of facilities are highly correlated. In some cases, it is easy to see that the increase in facilities preceded the increase in participation. This was especially true during the 1960s with the explosive growth in public golf courses. Prior to 1960, most courses were private, which by definition, limited access. • Competition: There are more and more alternatives for one’s leisure time than ever before. This is especially true with the explosion of electronic alternatives.

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Golf Operations Assessment National Trends in Golf

• Time: A round of golf takes a lot of time. For many, it is simply very difficult to find the time to play. On the other hand, many Golf Participation Since 1986 see the amount of time involved to be an asset (in Millions) rather than a weakness. 35.00 It provides a wonderful 30.00 opportunity to escape not only the hustle and bustle 25.00 of today’s world – but also 20.00 its electronic envelope. 15.00 • Social: While golf is an 10.00 individual sport, it is also a 5.00 group activity with a -

strong social component.

2008 1998

2006 1996

1988 1994 2004

1990 2000 2010 1992 2002 2012 One of the biggest reasons 1986 given for playing golf is “to Core Occasional Total socialize with friends.” • Business: It is often said that there are more deals done on the golf course than in the board room. And there is a lot of truth to this. Being able to entertain clients as well as socialize with coworkers (or the boss) has been a big reason for people to take up golf. Corporate golf outings account typically for at least 10% of the play, and sometimes as much as 50%, at higher-end daily fee facilities. Corporate retreats are often held at golf resorts, with golf being a major activity. • Tiger Woods: While it is difficult to ascertain the exact impact Tiger has had on golf, there is no doubt that it has been tremendous. It is not coincidence that the rise and fall of golf participation in the last 25 years coincides almost exactly with Tiger’s performance (and thus exposure) on the Tour. In fact, golf participation today is almost exactly where it was pre- Tiger. While the recent decline may be disturbing, there are many reasons for optimism. These include: • Latent Golfers: According to NGF, there are actually more people who express a desire to play golf than there are actual golfers. More importantly, this number, which now totals 32 million, has grown every year since 2011 when it was 27 million. • Beginners: More than half of all beginning golfers are between 18 and 39 years old. This speaks well for the future. • Youth Movement: The PGA of America has been championing youth golf for the past several years. The number of youth golfers has grown over this time by 29% to 3.1 million. • Jordan Spieth, etc.: While Tiger justifiably gets a lot of the credit for golf’s growth from 1995-2004, Arnold Palmer, Jack Nicklaus and to a lesser extent Lee Trevino and Gary Player, helped spur the dramatic growth in the game

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Golf Operations Assessment National Trends in Golf

during the 1960s. Today, the Tour is blessed with many young guns, such as Jordan Spieth, who have shown the potential to similarly capture the public’s imagination. • Top Golf: Golf participation, as the NGF defines it, is limited to those who played a round of golf. Historically, this definition made sense as very few people would practice a game they did not actually play. However, Top Golf has forever changed this reality. In case you are not familiar with Top Golf, it is a unique company and experience that has seen explosive growth over the past ten-years. A Top Golf facility is basically the marriage of a golf course driving range to an electronic game within a bar environment. A Top Golf facility will have a multi-story tee that fronts a driving range. The driving range features several target greens and a pair of goal posts at the end. Inside each “range” ball is a microchip that tracks that ball. An electronic “game board” adjoins each tee station. This allows for several “games” to be played. Basically, each target green is assigned a point value as are the goal posts. A player is given x number of balls to play. They can shoot at any target. The further the target is away, the higher the point value. But there is also a target right in front that virtually anyone can hit by simply dribbling the ball off the tee. At the same time, wait staff come by to keep the players supplied with the beverages (and food) of their choice. The average Top Golf facility will cost $15 to $25 million to build. And they make it up in the first year! Each Top Golf facility today generates an average of $20m in revenue a year. (Notably, 50% of the revenue comes from food and beverage). What is really amazing is that 95% of the players at Top Golf have never played a round of golf. It remains to be seen how successful the industry will be in transitioning the Top Golf generation into rounds on golf courses, but there are certainly many lessons to be learned. • Counter Revolution: Physics teaches that “for every action, there is an equal and opposite reaction.” Social movements are very much the same way, only the timing is often off. Each generation tends to “push back” against the previous. Thus, as today’s society trends toward electronics and “hyper” environments, the idea of an outdoor environment where one can not only commune with nature, but also socialize and play games, becomes more and more appealing. This, in fact, may pave the way for another growth spike in the game over the next ten-years. • Revolving Door: Last year about 3.5 million golfers “gave up” the game, while 2 million took it up and another 2 million returned. The main reasons for giving up the game were time, money and difficulty. • Age: Surprisingly, the highest percentage of “core” golfers (those who play 8 or more rounds a year) are aged 30-39 (18.8% of all golfers), followed by 40-49 (17.6%). There are actually more golfers under the age of 40 than over 50 (47% to 35%). This speaks well for the future of the game. It is our belief that golf participation will bottom out (if it hasn’t already) then begin to gradually increase over the next ten-years.

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Golf Operations Assessment National Trends in Golf

Rounds Rounds, of course, are what make the cash register ring. Rounds Annual Change in Total Rounds have basically yo-yoed back and 8.0% 6.7% forth over the past several years, 5.7% with a slight overall increase. This 6.0% trend follows about a ten-year history of decline since 2000. The 4.0% 2.1% 1.8% total number of rounds annually 2.0% has been around $375-380m for 0.9% 0.0%0.3% the nation. 0.0% -0.1% In addition to golf participation, -0.6% -0.6% -2.0% the factors that tend to influence -1.5% -1.8% -1.7% -2.3%-2.5% overall rounds the most are 1) -4.0% -3.0% weather and 2) the economy. For example, 2014 was a horrible -6.0% -4.9%

year, weather-wise as was 2013

2015

2014

2013

2012 2003

2011 2002

2001 2010

2009 2000 2006

2004 2007 2005 2008 (2014, in fact, had the fewest 1999 course open days since tracking began in 2004). 2015 was better and the increase in play reversed the two-year slide. Rounds were up again marginally last year (0.6%). However, rounds were down in 2017 by 3.8% largely due to unusually harsh weather nationally (Chicago’s 2017 numbers mimic the national with a 3.8% YTD reduction, with a 50% increase in precipitation over the time). In looking more closely at rounds, we find a very interesting trend. The number of rounds being played per golfer has been on a steady increase since 2003. In fact, the NGF says core golfers play more than two rounds a year more than they did in 2005. Another interesting fact is that rounds played per “playable” day has been increasing. This may be due to

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Golf Operations Assessment National Trends in Golf more favorable economic conditions. It may also be part of a trend towards “escaping the electronic hubbub.” Number of Facilities While the number of rounds has more or less held steady, the number of facilities in the U.S. has been steadily decreasing since peaking in 2005. This decline has certainly generated a lot of negative press as well as angst in the industry. The table below shows the change in the number of 18-hole equivalent facilities. (The number of 18-hole equivalent facilities is derived by taking the total number of golf holes and dividing by 18. Thus, two 9-hole courses count as one 18-hole equivalent facility (18HEQ), while a 36-hole complex counts as two.) Another alarming statistic is that, even though the number of facilities has declined, the number of golfers per facility has also declined significantly over the past 12 years. NGF estimates the decline to be around 16%. But again, a closer look reveals the sky is not falling. First, while the number of facilities has declined about 5% in the past 10 years, this pales in comparison to the 40% growth in facilities over the previous two decades. (Keep in mind, the US has 45% of the world’s golf courses). And while the number of golfers per facility has declined since 2003, it has held steady over the past five-years, even going up 1% last year. Change in # of 18-hole Equiv Facilities

500

400

300

200

100

0

-100

-200 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014

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It is important when looking at the change in the number of facilities, that the key word .is “change.” It takes into consideration both course openings as well as closings. In fact, when compared to the early 2000s, the biggest difference is not the number of course closings but the number of course openings. Prior to 2005, we were seeing 200+ golf course openings/year over the previous 15 years (most years had over 300). Yet there have only been 45 total new courses open over the past three-years. Closings are also way up. Why ARE golf courses closing? There are two primary reasons: 1) financial fails and 2) real estate opportunity. When looking at the closings, we see that a disproportionate number of them are either or both 9-hole facilities or “value” daily fee facilities (NGF defines a “value” facility as one with peak green fees less than $40). Only 7% of the facilities that have closed were private, according to NGF. NGF further reports that 85% of the public facilities that closed had peak fees under $40. Over half (57%) were 9-hole courses. Most of the rest of the facilities closed due to real estate development opportunities. With land becoming more and more valuable, golf courses are seen by developers as prime opportunities for development, largely due to their location. On the other hand, of the recent openings, NGF reports that 81% have at least 18 holes, and more than 60% are associated with real estate developments. Two- thirds of them have green fees over $40. And over 1/4th were private. So why are value facilities failing at disproportionately higher rate? I can think of several reasons. These include: • Margins: Golf courses have high fixed costs and low variable costs. Thus, lower fee courses typically have a much lower margin to work with. If the course has any debt, this margin can be extremely thin, making them much more vulnerable to fluctuations in the market due to weather, the economy or increased competition. • Oversupply/Competition: The golf course market went from huge demand to saturation to oversupply in a very brief period of time. The knee- jerk reaction for most operators in the face of competition is to lower their prices. (Which is a very poor strategy as it assumes no one else will lower theirs!) What we see happening is that a lot of mid-fee courses lower their prices to the point at which they are competitive with the value facilities. And given that the mid-fee courses typically have better facilities, the value courses suffer more.

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• Conditions: Golf courses deteriorate over time. Yet it requires considerable investment to rebuild infrastructure such as irrigation, greens, bunkers, etc. Value courses typically do not generate the revenue necessary to finance these repairs, causing the course conditions to decline. Performance and course conditions are very highly correlated. • Management: Value courses tend to be owner-operator facilities as opposed to being professionally managed. Many of these operators lack the sophistication, especially with regards to marketing, to compete in a highly competitive industry. • Real Estate Sales: The biggest push in new golf course construction during the 1990s and continuing today were real estate developments, where the golf course was the featured amenity. However, as the recession led to a reduction in home sales, many of these developments suffered as there were not enough homes to support the course. • Developers: Many real estate developers who built golf courses, were very short-sighted, and never considered the long-term health of the golf course and its subsequent impact on real estate sales. For example, If the development had major topographical features, such as a lake or a tremendous vista, they would inevitably take all the land having water frontage, etc., and turn it into featured lots –placing the golf course in the interior with no major feature. This works well in the short-term as these lots sell at a high value. However, because the golf course is less appealing, it holds less value for ALL the other lots and the public in general. So, it does less to enhance the value of the other lots. Instead, if the developer had given the golf course some waterfront (etc.) access, the golf course becomes more popular, has a better prospect for long-term success, and makes it a more valuable amenity for all the other homes, increasing both their value and their velocity (in terms of sales). • Difficulty/Design: Sadly, many architects (and developers) feel the need to make the golf course as difficult as possible, as if it were a competition and the PGA Tour was going to be knocking on their door. The truth is that the vast majority of golfers are higher handicap players. And while they enjoy an occasional challenge, they don’t want to be “beat up” every day. On the other hand, the golfing ego demands that there at least be an apparent challenge – that’s why golfers do not all play from the forward tee or play the easiest course. The best (and most successful) courses are those that appear challenging, but are fair and playable for the average golfer. The local market certainly has been an example of the above. Over the past few years, we have seen the closing of Rolling Knolls Country Club, Country Lakes Village Golf Course, Libertyville Golf Course, Maple Meadows East 9, Mid-Iron Club, Mission Hills, Woodbine Golf Course, Hunter Country Club, Orchard Hills, Wolf Run, Addison Golf Course, Crystal Highlands and, of course, Green Acres Country Club. It should also be pointed out that new golf course construction is almost exclusively with higher-end daily fee and private courses. It is also interesting to note that there were 17 new course openings last year, the highest number in five-years (up from 11 in 2014). What we are also seeing is an increasing number of courses

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Golf Operations Assessment National Trends in Golf undergoing major renovations each year. Another interesting statistic from last year is that there were 21 courses that reopened after being closed for a prolonged period (presumably from failure). NGF expects to see 15-25 new course openings this year, with 50-100 major renovations. They also expect there to be another 150-175 course closings. Renovations While we are not seeing nearly the number of new courses opening per year as in the recent past, there is no doubt that the number of major renovations is on a sharp increase. As noted above, NGF expects up to 100 new major renovations to be completed this year alone. There are two major reasons for the substantial increase in renovations. The first is that the facilities that were built during the “boom” years of the 1990s are now 20+ years old. As such, much of their infrastructure has gone beyond the expected life cycle. The table below comes from the US Golfers Association (USGA) and provides guidelines as to the expected lifecycle of golf course infrastructure.

As these parts wear out, course conditions decline and maintenance costs increase, hurting profitability on both revenue and expense sides. The other major reason for renovation is to gain a competitive edge. Golfers tend to like playing on “newer” courses. Major renovation (as opposed to ones that simply upgrade one aspect of the course), typically improve the golf experience significantly with improvements in both playability and aesthetics.

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Further, a recent study by Sirius Golf Advisors, in conjunction with the NGF, has shown that major renovations, especially when coupled with market repositioning plus increased marketing, can have a dramatic impact on performance. This study examined municipal golf courses in the Dallas-Ft. Worth area. At the time of the study, nineteen of these facilities had undergone renovations in recent years, with six doing major (over $3m) and four doing minor (under $1m). The two biggest findings were: • Both minor and major renovations had a significant impact in the first year. However, the improvement tapered off for the courses with minor improvements, while performance continued to increase for the major renovations. However, both renovation types paid for themselves over time. • By far, the biggest improvements were seen by courses that BOTH did major renovations and rebranded themselves. The Rebranders averaged a 65.5% increase in revenue (an average of $699,601) in the first year, compared to an 18.1% increase ($171,780) by the others. In the 2nd year, the Rebranders increased on average an additional $241,352, for a total improvement of 74.3% over base in the 2nd year. This compares to a $252,941 increase and 31.7% by the others.

Conclusion All indicators are that the recent decline in golf participation and facilities is more of a “market correction” than it is a foretelling of the future. Indeed, recent indicators are positive. Rounds are up, openings are up, participation among youth is up, etc. Further, while the number of facilities have been shrinking, the number of rounds has remained level or even increasing (this past year), thus concentrating the rounds on fewer facilities – making those facilities that much stronger. There is no doubt that closings will outnumber openings for several more years. As was the case with the growth in the number of facilities, real estate is leading the way. One of the biggest reasons for course closing is that the land has become more valuable for development than for golf. However, the stronger facilities, those that have good layouts, kept in good condition, and are well-managed, will not only survive, but will thrive. Prudent operators are recognizing this trend, which is one of the reasons we are seeing more and more renovations each year.

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In this section, we examine the general market as relates to the two facilities. We primarily focused on demographics as it relates to golf demand. All demographic and golf demand figures came from the National Golf Foundation. For Sportsman’s, we looked at three market areas: • Local Area: 15-minute drive time from the course – this represents where about 90% of the current business is coming from • Intermediate: 30-minute drive, and • Regional: 60-minute drive. For Anetsberger, we looked at the area within a 15-minute drive from the facility. We also looked at the metropolitan area. Below is a discussion on the key findings. Demographics Below is a summary discussion of the demographics around the two golf facilities. A more detailed profile can be found in Appendix A. Sportsman’s Population There are an estimated 549,184 people living within a 15-minute drive of Sportsman’s. This compares to 3,063,578 that live within a 30-minute drive, 8,247,160 living within an hour’s drive and 9,580,805 living in the metro area. Population Change Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Percent Percent Percent Percent Number Number Number Number Change Change Change Change 1980 Census 476,359 2,786,875 7,054,803 8,042,925 1990 Census 517,590 8.70% 2,870,590 3.00% 7,194,683 2.00% 8,181,089 1.70% 2000 Census 556,123 7.40% 3,115,674 8.50% 7,982,944 11.00% 9,098,339 11.20% 2010 Census 557,717 0.30% 3,051,186 -2.10% 8,133,659 1.90% 9,461,105 4.00% 2016 Projection 549,184 -1.50% 3,063,578 0.40% 8,247,160 1.40% 9,580,805 1.30% 2021 Projection 548,478 -0.10% 3,077,472 0.50% 8,296,768 0.60% 9,630,434 0.50%

As can be seen, the local population has stabilized and is starting to decline. The entire metro area, though, is expanding at a low rate.

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Race Race is important with regards to golf as whites have the highest participation rates, followed by Asians, then Hispanics, with blacks having the lowest of the four. Of course, participation is highly correlated with income, which makes up a large part of the difference. But there are also cultural factors at work. Whites make up 76% of the local population. The percentage declines to 62.4% for the 60-minute market, but ticks up to 64.1% for the metro area. Population by Race (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent White 418,856 76.30% 2,055,077 67.10% 5,143,232 62.40% 6,137,598 64.10% Black 16,413 3.00% 299,591 9.80% 1,448,147 17.60% 1,668,805 17.40% Asian 74,785 13.60% 301,532 9.80% 606,958 7.40% 632,330 6.60% Native American 1,344 0.20% 12,350 0.40% 33,294 0.40% 36,913 0.40% Hawaiian / Pacific Islander 149 0.00% 1,175 0.00% 2,698 0.00% 3,026 0.00% Two or More 11,854 2.20% 89,317 2.90% 224,379 2.70% 253,919 2.70% Other Race 25,783 4.70% 304,537 9.90% 788,452 9.60% 848,214 8.90% Total 549,184 100.00% 3,063,579 100.00% 8,247,160 100.00% 9,580,805 100.00%

By the same token, the local area only consists of 3% blacks, compared to 17.6% for the regional market. On the other hand, the local area consists of 13.6% Asian, compared to 9.8% for the intermediate and 7.4% for the regional markets.

Population by Race Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent White 2,109,282 69.10% 2,055,077 67.10% 2,015,792 65.50% Black 279,359 9.20% 299,591 9.80% 313,991 10.20% Native American 12,675 0.40% 12,350 0.40% 13,070 0.40% Asian 263,155 8.60% 301,532 9.80% 318,415 10.30% Hawaiian / Pacific 1,202 0.00% 1,175 0.00% 1,232 0.00% Islander Two or More 85,122 2.80% 89,317 2.90% 96,460 3.10% Other Race 300,391 9.80% 304,537 9.90% 318,512 10.30% Total 3,051,186 100.00% 3,063,578 100.00% 3,077,472 100.00% There is also a substantial difference in the percentage of Hispanics. The local white population is 13.2% Hispanic, compared to 24% for the intermediate area and 23.2% for the regional. The percentage of Hispanics is growing in each area. For the local market, it is expected to reach 14.9% by 2021, 25.3% for the

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Golf Operations Assessment Market intermediate and 24.5% for the regional. In each case, this means a reduction in the number of non-Hispanic whites as well as an increase in the number of Hispanics. Furthermore, we are seeing a shift in demographics, especially in the local area. The percentage of whites is decreasing and the percentage of both blacks and Asians is increasing. This same trend is true for the Intermediate market, but not as much for the regional.

Age Age in another important demographic in golf. While the highest participation is found in the 50-59 age band, seniors (over 60) generally produce the most rounds. This is because they have more time to devote to golf. This is a critical finding as the baby-boomers are reaching retirement age, and doing so with more disposable income than any previous generation. On the other hand, the millennials have shown a lower general interest in golf than the baby boomer generation. However, as youth program participation continues to reach record levels in each of the past several years, there is great hope that the generation following the millennials will again have a high Age Trend participation rate. 2010 2016 2021

The median age for the CENSUS ESTIMATE FORECAST local population is 42.3, Local (15 minute) which is significantly Median Age 42.3 42.2 42.9 higher than the other % under 20 25.5% 24.4% 24.1% market areas, which % over 60 22.7% 24.5% 26.6% are a little over 37 (the national average is 38). Intermediate (30 minute) All three areas, though, Median Age 36.2 37.4 38.7 are trending older. The % under 20 25.2% 24.2% 23.9% biggest increase is seen % over 60 17.1% 19.6% 22.0% in the intermediate market, which is Regional (60 minute) projected to go from a Median Age 35.7 37.1 38.3 median age of 37.4 to % under 20 27.6% 25.9% 25.0% 38.7 over the next five % over 60 16.3% 19.2% 21.8% years.

The local area does have, by far, the highest percentage of seniors, with nearly a quarter of the current population (24.5%) being over 60. This percentage should increase to 26.6% by the year 2021.

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Income Income, by far, is the demographic that is most highly correlated with golf participation. Participation increases as income increases. Again, the local market stands out. The average family income for the local market is $151,521, compared to $122,579 for the intermediate, $106,641 for the regional and $104,610 for the metro. Households by Income (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent Median Household Income $84,036 $69,099 $64,684 $64,684 Average Household Income $125,288 $99,941 $89,729 $88,331 Average Family Income $151,521 $122,579 $106,641 $104,610 Per Capita Income $48,725 $39,589 $34,102 $33,497 Less Than $10,000 7,925 3.70% 74,362 6.10% 217,940 7.00% 248,713 6.90% $10,000-$14,999 5,481 2.60% 43,662 3.60% 123,861 4.00% 142,774 3.90% $15,000-$19,999 6,430 3.00% 48,070 4.00% 133,957 4.30% 154,901 4.30% $20,000-$24,999 7,960 3.70% 53,690 4.40% 143,523 4.60% 164,960 4.60% $25,000-$29,999 7,001 3.30% 46,535 3.80% 127,210 4.10% 147,667 4.10% $30,000-$34,999 7,367 3.50% 47,240 3.90% 129,734 4.20% 151,501 4.20% $35,000-$39,999 7,397 3.50% 46,792 3.90% 124,704 4.00% 144,466 4.00% $40,000-$49,999 14,549 6.80% 91,851 7.60% 240,802 7.70% 279,363 7.70% $50,000-$59,999 13,848 6.50% 83,681 6.90% 225,821 7.20% 265,578 7.30% $60,000-$74,999 19,144 9.00% 113,282 9.40% 299,816 9.60% 351,952 9.70% $75,000-$99,999 26,373 12.40% 149,183 12.30% 393,186 12.60% 465,836 12.90% $100,000-$124,999 19,372 9.10% 106,183 8.80% 274,388 8.80% 324,466 9.00% $125,000-$149,999 15,412 7.20% 76,811 6.40% 195,329 6.30% 228,597 6.30% $150,000-$199,999 19,717 9.20% 91,220 7.50% 219,630 7.00% 251,809 7.00% $200,000-$249,999 13,619 6.40% 52,707 4.40% 104,840 3.40% 114,322 3.20% $250,000-$499,999 18,062 8.50% 70,018 5.80% 139,891 4.50% 152,539 4.20% $500,000+ 3,611 1.70% 13,919 1.20% 27,700 0.90% 30,208 0.80% Total 213,268 100.00% 1,209,206 100.00% 3,122,332 100.00% 3,619,652 100.00% % over $100,000 42.10% 34.10% 30.90% 30.50%

The percentage of households with incomes over $100,000 is 42.1% in the local market, compared to 34.1% in the intermediate, 30.9% in the regional and 30.5% in the metro. The gap between the regions is expected to remain about the same over the next five years.

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Home Ownership Home ownership is highly correlated with income. But it can also be an indicator of a transient population. Renters are more likely to move out of an area than home owners because they are less tied down. And once again, we find the local area has positive demographics. Almost three-fourths of the households in the local area are in owner occupied dwellings, compared to 57.2% in the intermediate area, 60.1% in the regional and 61.7% in the metro. This would seem to indicate a more stable population base for the local market. Households by Tenure (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent Owner Occupied 164,371 73.40% 727,633 57.20% 1,973,942 60.10% 2,349,281 61.70% Renter Occupied 48,897 21.80% 481,571 37.90% 1,148,388 35.00% 1,270,371 33.30% Vacant 10,798 4.80% 62,816 4.90% 161,366 4.90% 190,294 5.00% Total 224,066 100.00% 1,272,020 100.00% 3,283,696 100.00% 3,809,946 100.00%

Anetsberger There is not a lot of difference between the local market for Sportsman’s and that of Anetsberger. Below are the most salient. • Population: There are only 431,668 people within a 15-minute drive of AGC compared to 549,184 for SCC. However, the AGC local market is expected to increase its population over the next five years (by 1.9%) compared to an expected decrease to the SCC market. • Race: AGC’s local market has a slightly higher Asian population, 15.4% compared to 13.6%. It also has a lower percentage of Hispanics (11.4% of whites compared to 13.4%). • Age: AGC’s is a little older, with a median age of 43.1 compared to 42.3. • Income: AGC’s market has a slightly higher income, with an average family income of $158,475 compared to SGC’s $151,521. Discussion Bottom line, AGC’s local market is even more favorable to golf than SCC's. However, as a Par 3 course, AGC is expected to draw virtually all its play from the local market. As a premium facility, SCC is expected to draw significant play from both the intermediate and regional markets, although this has not necessarily been the case. Both local markets, though, are highly favorable for golf. And while there is certainly drop off from the local to the intermediate market, the intermediate and regional markets are still favorable for golf.

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Golf Demand The National Golf Foundation (NGF) does an annual survey that measures golf participation in the U.S. This is universally recognized as the industry standard for these measures. Based on these survey results, NGF can accurately estimate golf participation for a given area, including both the participation rate and the number of rounds produced. Sportsman’s Below is a table comparing the three market areas with regards to golf demand, including participation and rounds produced. As can be seen, and would be expected given the demographics of the area, the household participation rate is significantly higher (28%) for the local market compared to the intermediate or regional markets. However, the rates for the intermediate and regional areas are still much higher than the national average of 13.8% of households containing at least one golfer. Demand Measures Travel Time of 15 Travel Time of 30 Travel Time of 60

minutes minutes minutes Total Households 211,909 1,199,573 3,117,836 Number of Golfing Households 45,869 201,386 521,238 Projected Golfing Households (2020) 46,626 205,292 532,140 Projected Annual Growth Rate 0.30% 0.40% 0.40% Seasonal Golfing Households 416 1,289 3,884 Latent Demand/Interested Non-Golfers 69,495 425,352 1,066,344 Household Participation Rate 21.60% 16.80% 16.70% Number of Golfers 64,087 284,466 769,404 Rounds Potential (resident golfers) 1,186,969 4,807,774 12,607,330 Est. Course Rounds (in-market supply) 1,219,755 3,019,652 7,994,856 Median Household Income $84,159 $69,075 $64,551 Median Age 42.3 37.3 37.1 US Median Household Income $56,106 $56,106 $56,106 US Median Age 38 38 38

Other than the participation rates, another fact that jumps out is the comparison of estimated rounds produced (Rounds Potential) and actual rounds realized (Est. course rounds). We can see that the Local market generates fewer rounds than the area courses receive. However, this changes dramatically as we move away from the local area. The local courses are reporting far fewer rounds than the population potentially is generating. This strongly implies a demand market for these areas suggesting a market opportunity.

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NGF has also developed index values to help in comparisons. The index value is based on percentage comparison to the national average, with the national average being assigned a value of 100. Thus, an index value of 90 would mean 90% of the national average, while an index of 110 would mean 110% above the national average. Demand Indices (National = 100) Travel Time of 15 Travel Time of 30 Travel Time of 60

minutes minutes minutes Golfing Household Participation Rate 157 122 121 Seasonal Golfing Households 33 18 21 Latent Demand/Interested Non-Golfers 110 121 112 Rounds Potential per Household (resident 149 107 108 golfers) Est. Course Rounds per Household (in-market 153 67 68 supply)

As can be seen, the participation rate for each of the three market areas is significantly better than the US average, with the Local market more than 1 ½ times greater. We also have a higher than normal percentage of latent golfers. These are people who have expressed an interest in playing golf, but did not play in the past year. This is also a good market opportunity, especially with the SCC’s Academy. Also notable is that not only is the participation higher, but the rounds generated per household is higher than the national average. Again, the local market is producing about 1.5 times as many rounds per household as the US average. We also see a remarkable fall-off between the local market and the other markets in terms of rounds played at area golf courses per local household. The number for the local market is over 1.5 times the national average, while the numbers for the intermediate and regional markets are about two-thirds the national average. This would imply that we are seeing a lot more rounds at the local courses than those outside the local area. Anetsberger The values are similar for the Anetsberger market areas. Demand Measures Travel Time of 15 Travel Time of 30

minutes minutes Total Households 167,718 1,248,590 Number of Golfing Households 37,496 195,573 Projected Golfing Households (2020) 38,215 200,147 Projected Annual Growth Rate 0.40% 0.50% Seasonal Golfing Households 347 2,037

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Demand Measures Travel Time of 15 Travel Time of 30

minutes minutes Latent Demand/Interested Non-Golfers 53,633 445,392 Household Participation Rate 22.40% 15.70% Number of Golfers 52,489 271,441 Rounds Potential (resident golfers) 993,201 4,629,611 Est. Course Rounds (in-market supply) 959,906 2,307,185 Median Household Income $83,226 $67,497 Median Age 43.1 36.9 US Median Household Income $56,106 $56,106 US Median Age 38 38

Demand Indices (National = 100) Travel Time of Travel Time of

15 minutes 30 minutes Golfing Household Participation Rate 162 114 Seasonal Golfing Households 35 28 Latent Demand/Interested Non-Golfers 107 125 Rounds Potential per Household (resident golfers) 158 99 Est. Course Rounds per Household (in-market 152 49 supply)

Golf Supply Now that we have an idea of how many rounds are being produced by the various markets, let’s examine the supply of golf holes that are available to absorb this demand. Below shows the number of facilities in each of the market areas. Keep in mind that the intermediate area also includes the local area, etc. All statistics are provided by NGF. As can be seen, there are 44 golf facilities within a 15-minute drive of Sportsman’s. This includes five daily-fee public courses, 19 municipal facilities and 20 private clubs.

In contrast, the entire metro area has 336 golf facilities, including 129 municipal, 107 daily-fee and 100 private. In other words, the local market has 10% of the supply of public facilities (daily fee and municipal) in the metro area, but 20% of the private clubs.

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Number of Golf Facilities Travel Time of 15 Travel Time of 30 Travel Time of Metro Area minutes minutes 60 minutes Total 44 104 262 336 Public 24 61 179 236 Public: Daily Fee 5 15 67 107 Public: Municipal 19 46 112 129 Private 20 43 83 100 The National Golf Foundation divides public courses into three categories based on their highest rack rate, including green and cart fees. Premium courses are those that charge over $70 during peak time (normally weekend mornings). Standard courses charge between $40 and $70 and Value facilities charge under $40. SCC, by these measures, is considered a “Premium” facility, while AGC is considered a “Value” facility. NGF does not make a distinction between the Classic 18 and the East 9 as both are at the same facility. Number of Public Golf Facilities by Price Point Travel Time of Travel Time Travel Time Metro Area 15 minutes of 30 minutes of 60 minutes Premium (>$70) 10 18 37 38 Standard ($40-$70) 5 21 77 105 Value (<$40) 9 22 65 93

% premium 41.7% 0.0% 29.5% 0.0% 20.7% 0.0% 16.1% % standard 20.8% 0.0% 34.4% 0.0% 43.0% 0.0% 44.5% % value 37.5% 0.0% 36.1% 0.0% 36.3% 0.0% 39.4%

Notably, the value facilities in the local market consist of nine-hole courses, executive length courses and Par 3 courses. There are no regulation 18-hole “value” courses in the local market. Number of Holes Travel Time of 15 Travel Time of 30 Travel Time of Metro Area minutes minutes 60 minutes Total 738 1,800 4,608 5,949 Public 369 999 3,069 4,068 Public: Daily Fee 63 234 1,287 2,025 Public: Municipal 306 765 1,782 2,043 Private 369 801 1,539 1,881 Non-Regulation (Executive & Par- 72 171 387 468 3) * What is noteworthy is the ratio of premium courses compared to the total supply by market area. In the local market, 41.7% of the facilities are classified as Premium

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Golf Operations Assessment Market and just 20.8% as Standard. The percentage of Premium facilities falls as you move away from the local area. In the intermediate area, 29.5% of the courses are Premium, in the regional area 20.7% and in the metro area, just 16.1%. On the other hand, 34.4% of the intermediate courses are Standard, compared to 43% for the regional area and 44.5% for the metro. When we change from number of facilities to number of holes, the story is similar.

Half of the local supply of golf holes are public. This compares to 55.5% for the intermediate area, 66.6% for the regional and 68.4% for the metro. We also see a higher ratio of municipally owned facilities in the local area. The local area has 41.5% of the holes are municipal. The intermediate area is slightly higher at 42.5%, but then it falls to 38.7% for the regional and 34.3% for the metro. Relevant more to AGC, we also note a slightly higher ratio of non-regulation facilities (executive and par 3) in the local market, with 9.8% of the total holes. This falls to 9.5% for the intermediate, 8.4% for the regional and 7.9% for the metro. This may reflect the age of the local market, as seniors are more likely to prefer the shorter courses than the younger adult golfers.

Change in supply The area has been losing holes of golf over the past few years as seen in the chart below. Net Change Travel Time of 15 Travel Time of 30 Travel Time of Metro Area minutes minutes 60 minutes Total Holes Past 5 Yrs. -27 -63 -181 -207 Percentage Total Holes Past 5 -3.66% -3.50% -3.93% -3.48% Yrs. Total Holes Past 10 Yrs. 9 -27 -216 -252 Percentage Total Holes Past 10 1.22% -1.50% -4.69% -4.24% Yrs.

The local area has lost 27 holes in the past five years, including Green Acres that closed this year. However, it has seen a net gain of 9 holes over the past 10 years. It is the only market area to have a positive growth. On the other hand, the intermediate area has lost a total of 63 holes over the past five years, which is 3.5% of the supply. The regional area has seen a loss of 207 holes, or 3.5% of the supply, in the past 5 years, and 252 or 4.24% of the supply in the past 10. Anetsberger AGC has a lot fewer courses in the local market (15-minute drive), than SCC, with 19 public courses compared to 24 for SCC. The biggest reason for the dramatic

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change is because we defined the markets by drive time, not distance. AGC is harder to get to than SCC, giving it a more compact local and intermediate market. There are still 63 non-regulation holes within AGC’s local market and 153 in its intermediate market. We also note that it has seen a loss of 45 holes over the past five years, compared to 27 for SCC. Supply and Demand The table below looks at the number of golfing households per 18 holes of golf. This is a measure of demand. The more households per 18 holes of golf, the greater the need for more holes of golf. Again, the index value is the more salient figure. Here, an index value of less than 100 means there is more supply per golfer than the national average and thus, less demand for more facilities. The higher the index value, the greater the demand. Golfing Households Per 18 Holes Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro minutes minutes minutes # Index # Index # Index # Index Total 1,119 93 2,014 167 2,036 168 1,868 154 Public 2,238 135 3,629 219 3,057 185 2,731 165 Public: Daily Fee 13,105 15,491 7,290 5,487 Public: Municipal 2,698 4,738 5,265 5,438 Private 2,238 50 4,526 101 6,096 136 5,907 132 Premium (>$70) 4,368 43 10,599 104 11,713 115 13,566 134 Standard ($40-$70) 8,340 210 8,756 221 6,096 154 5,253 132 Value (<$40) 10,193 258 14,917 377 12,870 326 9,798 248

As can be seen, there appears to be a general undersupply of golf in the metro area. Other than the index for private courses and premium public courses in the local area, all the indexes are greater than the national average. Here, the crucial point to recognize is that Sportsman’s is in the most competitive group with an index value of 43, or 43% of the national average of golfing households per 18 holes of premium golf. This further suggests that Sportsman’s may have a greater market opportunity by going down a classification. By the same token, AGC is in one of the best categories – Value golf. However, the fact that it is not a regulation course hurts its general appeal in this category. Of course, one also must factor in the market area. Both SCC and AGC are in affluent areas, which is consistent with its Premium designation. Stepping down to a “Standard” facility would generate a market mismatch between the facility and the local demographics. Thus, we have an enigma. Stepping down would mean

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Golf Operations Assessment Market less competition, but it would also mean creating a mismatch with the local demographics. Anetsberger Below are the supply and demand ratios for AGC. They are very similar to those for SCC. They also indicate that AGC is in a good category from a competitive perspective.

Golfing Household Indices (National = 100) Travel Time of 15 Travel Time of 30

minutes minutes Total 98 211 Public 142 285 Private 54 125 Premium (>$70) 57 133 Standard ($40-$70) 172 290 Value (<$40) 237 495

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In reviewing the competition for the various courses in NPD’s golf operation, we first looked at the overall market. But the primary focus of our review was on those courses we deemed most comparable to the NPD facilities, either in terms of location, market, overall operations or customer feedback from the survey. Overall Market We looked at four different distance radii from Sportsman’s Country Club including as far away as 50 miles, because we know that golfers will travel that far to occasionally play a Premium facility like SCC. (That is not true for value facilities, such as AGC). However, the bulk of the play is expected to be closer to the facility’s location. We examined 5, 10, 25 and 50- mile radii. A comparison of the courses is given below. This table includes all courses, regardless of type, including Par 3 and executive courses. For 9-hole courses, the length was doubled to make it an 18-hole equivalent. Data provided by NGF.

Market Area 5 Mile 10 Mile 25 Mile 50 Mile Total Number of Facilities 21 56 157 284 Total Number of Golf Courses 24 60 170 313 # Public Courses 15 34 109 222 # Private Courses 9 26 61 91 For Public Courses, only:

Total number of holes 198 540 1,710 3,537 18-hole Equivalents 11.0 30.0 95.0 196.5 Average Age 61.8 62.7 63.1 55.6 Average Peak Fee (incl. cart) $66.15 $56.70 $55.67 $53.43 Average Length 5,926.2 5,431.3 5,388.9 5,901.9 Average Slope 70.8 125.2 123.8 124.3

As can be seen, the average age for courses in all the market areas is well over 50 years of age. This is significant as customers tend to prefer modern designs. Of course, several of these facilities have undergone major renovations in the past 10 years so they are more modern.

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We also note that there is a trend towards older, shorter and cheaper courses as you move away from the local area – until you go beyond the 25-mile radius. Then they continue to become cheaper, but they gain yardage and difficulty. No doubt the shorter length for the 10- and 25-mile radius is due to the presence of more Par 3 and Executive courses that are largely absent once you move beyond 25 miles from Sportsman’s. In any case, we note that having 24 golf courses within 5-miles of SCC and another 19 from 5 to 10 miles, means a highly competitive environment for golf. Course Closings Several courses have closed in the area in the past 10 years. Below is a list of known course closings since 2010.

These closures are not all due to deficient performance. Indeed, most of these courses were sold for redevelopment purposes. It is important to note, though, that 8 of the 13 courses that closed were non-regulation courses (Par 3 and Executive). Several others would be considered “low-end”. Only one was private, Green Acres, which was foreclosed. This echoes the national trend that shows that most course closings are value courses, unless they are being sold for redevelopment, in which case land value is the driving factor.

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Comparables We narrowed the large field of golf courses down to a list of courses that we feel are good comparables for the NPD’s three golf courses. The list was derived by a course’s location (if they were near one of the NPD courses), as well as staff recommendations, analysis of customer feedback, price point, and physical and/or operating characteristics of the club. All courses within 10 miles of the facility were

automatically included. Each of these courses was visited by Mr. Wait. We also derived information from their websites. For municipally owned courses, we examined published performance records. We then sent a detailed survey to each of the facilities. Seven courses responded.

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In the interest of brevity and clarity, we will present only the significant findings in this section. A detailed list of the comparable courses can be found in Appendix B. Classic 18 We ended with a total of 33 comparable golf facilities for the Classic 18, with a total of 34 courses. One facility (Countryside) has two 18-hole courses. This does not include facilities that have a second course that is not comparable to the Classic 18, such as a stand-alone 9-hole regulation course (Village Links), or a Par 3 course (Cantigny, Winnetka). There were two courses that operate as 27-hole facilities with three interchangeable nines (Arrowhead and Schaumburg). However, Schaumburg is currently operating as an 18-hole facility as it renovates nine holes at a time. Deerfield, at 2.6 miles, was the course closest to SCC, while Arrowhead, at 25.4 miles, was the farthest. Facilities beyond 26 miles were not considered comparable due to location factors. Five of the courses were daily fee facilities (public, but privately owned), the rest being municipal. Note: Sunset Valley Golf Course, which would have been included was not because it is closed this year for renovations. It will reopen next summer. All their staff was relocated to Highland Park Country Club. Notably, only five communities had more than one course, each having two (Mt. Prospect, Buffalo Grove, Glenview, Hoffman Estates and Wheaton.) Comparable Course Characteristics Distance from SCC (in Classic Under Over miles) 18 5 5-10 10-20 20 All Number of Courses 7 12 8 5 34 Averages Median Household Income $118,480 $118,587 $102,049 $83,109 $74,380 $96,464 Age 86 62.1 70.1 39.3 46.8 56.1 Men’s Par 70 71.3 71.2 71.8 71.8 71.5 Number of Teeboxes 4 4.1 3.9 4.4 4.0 4.1 Number of Bunkers 83 53.3 57.4 43.6 80.0 56.2 Back Tee Length 6,278 6,610.4 6,425.2 6,901.3 6,949.3 6,659.9 Par 72 equivalent 6,457 6,674.8 6,498.8 6,922.0 6,973.3 6,715.6 Slope 128 133.1 130.6 137.3 136.3 133.8 Middle Tee Yardage 6,010 6,038.6 5,901.0 6,229.3 6,175.3 6,057.7 Slope 125 127.2 120.2 129.9 124.6 124.9 "Senior" tee yardage 5,558 5,414.4 5,459.8 5,655.1 6,004.0 5,553.4 Slope 120 119.2 120.6 124.4 126.0 122.0 3…………………Forward Tee Length 5,133 4,973.3 5,039.1 5,079.0 5,188.5 5,054.6 Slope for women 133 110.8 121.3 122.2 123.5 119.5 Par 72 equivalent 5,280 5,019.0 5,096.9 4,932.3 5,205.8 5,100.0 Par 72 men equivalent 7,542 7,170.0 7,281.2 7,046.2 7,436.8 7,210.2 We also grouped the courses by distance from SCC, breaking them into four groups: Five and under miles, between 5 and 10, between 10 and 20, and over 20.

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Median Household Income One of the factors we examined was Median Household Income for the community where the course was located. The average for all the cities was a very respectable $96,464. The richest community was Glencoe at $180,208, followed by Lake Forest at $155,792, and Lake Bluff ($145,500). With a Median Income of $118,480, Northbrook ranked eighth. Eleven of the communities had median household incomes of over $100,000. Household Income decreased as we moved farther away from SCC, with the local area (5-mile radius) having an average of $118,587, while the furthest group (20+ mile) averaged $74,380. Age The average age of the courses was 56.1 years. Again, this is significant because, in general, customers prefer newer courses. At 86-years-old, the Classic 18 is one of the older clubs. The newest course, Foxford Hills, opened 15 years ago in 2002. The Glen Club, opened in 2001, is the next newest and the only other course to open after the turn of the century. Winnetka, at 103 years of age, was the oldest facility, followed by Glenview Park and Schaumburg, both opening in 1920. Remarkably, even at 86 years of age, the Classic 18 was just the 12th oldest course. It is noteworthy that the courses under 10 miles’ distance are significantly older than those over 10 miles. Par The average par for the courses was 71.5. Four of the courses had pars of 71 and seven, including the Classic 18, had a par of 70. All other factors being equal, the further away you get from a Par of 72, the less popular the facility. (Although there is a sharp drop off when you get below 70). With a Par of 70, SCC is at a competitive disadvantage. Several of the facilities, including SCC, have a par for women that is different than the men’s par. This is generally in the direction of the women having a greater par. However, two courses, Crane’s Landing and Mt. Prospect, give the women fewer strokes. Crane’s Landing has a par of 70 for men and 69 for women, Mt. Prospect has a men’s par of 72 and a women’s par of 70. Six courses give women at least one more stroke. Buffalo Grove gives them three (75 vs. 72), two give them two strokes (Old Orchard and Deerpath), the rest give one stroke. Number of Tees The average number of teeboxes is 4.1 per hole. Sportsman’s, with four tee locations, is in line with the competition. However, it needs to be noted that most modern courses feature five teeboxes to maximize market reach. Many new courses have six. Presumably, the more teeboxes you have, the greater the market coverage. Range Seven of the facilities do not have ranges. The rest do.

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Length Back Tee Yardage The length from the back tee is extremely important in golf. It’s not that that many players regularly play from the back tee, but because it is one of the few statistics that are regularly associated with a course in the media. Thus, it becomes an important influencing factor in a golfer choosing where to play. The modern “standard” has become 7,000 yards plus, which is largely based on where the tour pros play. However, golfers and golf media have basically accepted this figure as the modern standard. Courses shorter than this, especially those under 6,600 yards, are often considered “short” courses by the media and therefore by golfers at large. Being considered a “short” course unfortunately creates a negative stigma about a course, even though the player’s normal playing yardage is within the course’s spectrum. Thus, a player who normally plays from 6,200 yards may shy away from a course whose back yardage is 6,200 yards just because it is considered a “short” course and thus “easier” and less challenging (Even though slope is a better measure of a course’s difficulty than yardage, most players still primarily refer to yardage, rather than slope, when considering where to play). It is also noteworthy that the PGA will not consider a course under 6,600 yards for any of their events, including qualifiers. The courses averaged 6,660 yards in length. The longest course was at Pine Meadows (7,218) followed by Village Links (7,208), The Glen Club (7,170), White Deer Run (7,149) and Stonewall Orchard (7,124). Interestingly, all of these courses are over 10 miles away from SCC. In total, eight of the courses (23%) are over 7,000 yards long. At 6,278 yards, SCC is at a significant disadvantage to the competition as it is considered a “short” course. Not only is it losing market share from the estimated 17% of players who prefer to play from 6,500 yards and longer, but it will lose share from other golfers due to the stigma of being “short.” However, it is not alone. Eleven of the courses (31%) are under 6,500 yards from the back tee, and six of them (17%) are under 6,300 yards. The shortest is Chick Evans at 5,646 yards, followed by Glenview Park (6,113), Old Orchard (6,187), Deerpath (6,255) and the Classic 18. It should be noted that the only reason Chick Evans was included as a “comparable” course is its proximity to SCC. Another factor to be considered is the yardage in relationship to par. As Sportsman’s is a par 70 course, its equivalent yardage (yardage/70 then multiplied by 72) is 6,457. Still too short for the better players, but better than the posted yardage. Unfortunately, golfers do not do math. They tend to look at the posted yardage and not take into consideration the Par. Thus, SCC is being unduly “punished” because of it being a par 70. Again, there is a trend. Courses within 10 miles of SCC averaged 6,493 yards, while those over 10 miles, which tended to be newer) averaged 6,916 yards.

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Middle Tee Yardage About half of all play comes from the middle yardage. Most men prefer to play from 6,000 to 6,500 yards, with the most popular being around 6,250. However, psychologically, the tee must have a “6” in front – in other words, must be over 6,000 yards. Popularity drops off dramatically if it’s under 6,000, with the men moving back to the first tee that is over 6,000 yards. With most courses, the middle tee will be set up in this “sweet spot” range. Most often this is noted on the course as the “white” tee, but not always. In our analysis, we took the tee that is closest to 6,200 yards as the “regular” tee. Any tee longer than that, but short of the back tee, we consider to be the “champion tee”. A tee that is shorter, but not the forward tee, is considered the “senior” tee as that is the tee that most senior men prefer. The comparable courses average 6,063.6 yards from the middle tees. SCC is right there at 6,010 yards. It’s equivalent yardage (for a par 72 course) is close to ideal at 6,182 yards. So, for most male golfers, the Classic 18 has perfect yardage. “Senior” Tees As noted above, we consider tees that are in front of the regular tees, but behind the forward tees to be “senior” tees as these are the tees preferred by senior men. The most popular distance for senior men is 5,500 yards. Over half (18) of the courses surveyed had senior tees. These averaged 5,553 yards in length. Sportsman’s was close to the average, at 5,558. It is very important to note that male seniors will disdain using the forward tees as they still consider them the “ladies’ tee.” So, they will automatically go to the 2nd tee back from the forward tee. Thus, SCC has a competitive advantage over the courses that do not have a senior tee for the senior player. Forward Tees A far different story emerges when we examine the forward tees. The forward tees are the tee preferred by most women players (lower handicap women tend to prefer playing from the “senior” tees.) Here we have a big discrepancy between perception and reality. Until recently, most architects and the golf media considered 5,000 yards to be the “standard” yardage for women. But this does not accurately take into consideration the fact that women do not hit the ball as far as men. Indeed, recent studies suggest that women, at best, hit the ball about 70% on average, as far as men. A recent USGA study put the figure at 62%. Thus, if you take 5,000 yards and divide it by 70%, the percentage of the distance women hit from men, we find that it is the equivalent of a 7,142-yard course! Less than 1% of male players play from this distance, yet most courses are asking women to play it’s equivalent. This results in two things, both of which are bad. It obviously takes more strokes to play from 7,000 yards than from 6,000 yards. As a result, you score worse. This tends to make it less enjoyable, especially if you are scoring worse than you “normally” do. This, in turn, will make the course less popular with women. (Note:

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Golf Operations Assessment Competitive Review if this is your home course, then you accept the score you shoot to be normal, so you may not notice the big disadvantage you are getting relative to the men.) However, the second factor may be even more important. Obviously, the more strokes you are taking, the slower you will be playing. This not only affects the time you play, but the time it takes all groups behind you to play as well. So, a course that has significant play from women, but whose forward tee is long is likely to have a significantly slower pace of play. It also leads to the stereotype seen from many men players that “women play too slow.” Well that’s because they are playing from 7,000 yards and you’re playing from 6,000. Of course, they are going to be playing slower! At Sportsman’s, with a forward tee of 5,133 and a par of 71 for women, the women are playing the equivalent of a 7,542-yard course for men! This puts the course at a significant competitive disadvantage. Further, it greatly increases the pace of play, not only for women, but for all golfers playing behind them. Assuming women hit the ball 70% as far as men, the equivalent of the preferred distance for men (6,000 to 6,500 yards) would be 4,200 to 4,500 yards. However, few courses are this short from the forward tees. The average yardage for the comparable group from the forward tees is 5,064 yards. The majority of the courses (20 or 57%) play from over 5,000 yards. Only four are less than 4,500 yards. The Classic 18 is not the most unfriendly for women, though. When adjusting both for gender and par, that “honor” would go to Highland Woods, whose forward tee measures 5,831 yards. This is the equivalent of an 8,330-yard course for women. Might as well have a sign saying, “women not welcome here.” In fact, five of the courses have equivalent yardage of over 8,000 yards! Next is Buffalo Grove at 8,210, Glencoe at 8,066, Winnetka at 8,066 and Deerpath at 8,014. The average equivalent yardage for all the comparable courses is 7,210 yards! The course that would seem to be most friendly to women is Crane’s Landing, whose forward tee of just 3,641 yards is the equivalent of 5,350 yards. From there, we jump to Old Orchard, whose 4,174 yards is the equivalent of 6,133 yards for women, nearly ideal. But then the next shortest jumps to Bridges of Poplar Creek, whose 4,597-yard forward tee is the equivalent of 6,755 for men. In other words, only one of the 34 courses has a forward tee that equates to the preferred yardage for male golfers. A new forward tee in the range of 4,000 to 4,400 yards would make the Classic 18 Course one of the best area courses for women and give it a major competitive advantage. It would also improve the pace of play. Slope Slope is a measure created by the USGA to provide a measure of a course’s difficulty. It is based on the theoretical average of 111 for all tees for all courses in the U.S. Courses over 140 are considered extremely difficult. Courses whose back tee has a slope of under 120 are considered “very easy.”

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The average slope from the back tees is 133.2. With a slope of 128 from the back tee, SCC ranks 27th of the 34 courses in terms of difficulty. This puts SCC at a competitive disadvantage with respect to the male golfers with handicaps under 10 who typically enjoy playing more challenging courses. This is most likely due to the length of the course than any other factor. Bunkers With 83 bunkers, the Classic 18 has more bunkers than all but two of the competitors (Arrowhead and Village Links both have 89). The average number is 56.2. Course Ratings To get an idea of how the public feels about the various courses, we looked at several course rating services. These include Google, Golf Now, Golf Advisor, Chicago Golf Guide, and staff at SCC. Of these, Google probably has the most objective rating service, although all sites have a potential bias as they do get advertising revenue. All the rating services used a five-point system, with 5 being the highest score possible. SCC fared best with Chicago Golf Guide, which gave it 4 stars, tying it for third among the courses rated (30). The two rated higher were Cantigny and Deerfield, both rated 4.5. The average for the 30 courses was 3.5. Next was Google, where it received a 4.2 rating (4.1 was the average), which was 13th best of the 32 facilities. It also had 33 ratings, which was good for 11th place. However, it did not do as well with the other services. Golf Now gave it a 3-star rating, which was 24th among the courses – and it only had one response. Now that SCC is on Golf Now, we expect that number to go up. On Golf Advisor, SCC also only got three and a half stars, the sixth worst among the peer group. But again, the number of responses was minimal (two). One of the main take-aways from these ratings is the relatively small number of raters rating SCC. This is especially concerning given that SCC is one of the highest volume facilities in the group. What it indicates is that SCC is attracting relatively little play from outside its regular base of customers. Fees Naturally, one of the biggest factors that influence where one plays is the cost. In today’s market, nearly every course offers a wide range of fees to entice play during slower times and to gain competitive advantage. However, golf still operates on a “supply and demand’ model with respect to pricing. As weekends are far more popular for play, prices during weekends are typically a lot higher than for play during the week. In general, we found SCC’s prices to be near the middle of the comparable group, which has been the strategy for the operation.

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Cart Fee The cart fee is what a single player can expect to pay extra for using a golf cart. However, it should be noted that several courses bundle the cart fee with the playing fee, with the expectation that everyone will take a cart. In our analysis, only Old Orchard showed just the bundled fee, without a cheaper walking rate. Although several others required carts on weekends. SCC charges $18 for carts. This is about $1.22 more than the average for the group ($16.81). Only nine facilities charge more, while 17 charge less. Five facilities, led by The Glen Club at $25, charge $20 or more. Weekday “Rack” Rate The “Rack” rate is the posted rate for a golf course, without any discounts being applied. It is what a person walking in off the street during peak play period who does not qualify for a standard discount (such as senior, junior or resident) would expect to pay. In today’s market, which is ripe with online discounts, fewer and fewer golfers end up paying the rack rate. However, it still is a good measure for comparison as the percentage discounts tend to be similar. In our discussion of rack rates, we will refer to the bundled rate that includes both the green fee and single cart fee. Comparable Course Fees Distance from SCC (in 10- miles) Classic 18 Under 5 5-10 20 over 20 All Averages $18.00 $18.14 $17.27 $14.90 $18.00 $16.81 18-hole cart fee Weekday Bundled Rate (GF+Cart) Peak Period non-resident $62.00 $74.00 $62.08 $62.30 $75.00 $66.24 Peak Period Resident $55.00 $55.20 $54.10 $49.80 $52.33 $53.21 Weekday Green fee only Senior $35.00 $29.33 $35.18 $33.72 $42.33 $34.19 Twilight $31.00 $43.29 $33.55 $31.85 $28.00 $34.75 Resident Senior Peak $29.00 $25.20 $30.77 $26.80 $20.33 $27.18 9 Hole Resident $22.20 $24.04 $22.89 $24.20 $18.25 $23.03 Weekend Bundled Rate Peak Period non-resident $73.00 $92.71 $69.58 $78.50 $85.25 $78.39 Peak Period Resident $64.00 $65.20 $62.25 $66.40 $58.00 $63.20 Weekend Green Fee Only Senior NA $42.50 $49.43 NA $56.00 $49.33 Twilight $39.00 $48.71 $33.45 $34.15 $28.38 $36.91

Non-Resident The average non-resident weekday rack rate was $66.24. SCC, at $62 is a bit under the average. The Glen Club, at $155, was the most expensive. Only one

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Golf Operations Assessment Competitive Review other course, Cantigny, topped $100 ($101). If Glen Club is removed, the local area’s average rate drops from $74 to $60.50, meaning SCC is close to the average for courses in the local, 5-10 and 10-20 mile areas. Only the over 20-mile group is higher. However, keep in mind we only selected five courses out of this area as part of our comparable group. SCC ranked 19th among the 34 courses. The median price was $64. Resident Most, but not all, the municipal courses offered a resident discount, while none of the daily fee properties did. In all, 26 properties had a resident rate. The average weekday price for residents was $53.21. SCC was slightly above the average at $55. But it was very close to the 5-mile average of $55.20. SCC ranked 11th of the 26 in terms of price. However, SCC’s price was equal to the median price for the 26 facilities. Residents typically receive the discount on green fees only, not the cart fees. The average discount for residents was 18.4%. SCC’s discount of 15.9% was slightly below the group average but above that seen for the 5-mile radius (14.7%). Weekend Rates All the facilities charged significantly more for the weekends. The average rate for non-residents was $78.39. At $73, SCC ranked 20th in price, just below the median value of $74. The highest weekend fee was at The Glen Club ($220), followed by Cantigny ($117). They were the only two facilities charging over $100. On the other end, Chick Evans at $50 was the cheapest, followed by Countryside ($55), and Bittersweet ($51). Grouping Two of the facilities were priced over $100; another two between $90 and $100, four were in the $80’s, a whopping 13 were in the $70’s, five in the $60s and seven were priced under $60. Notably, four of the seven immediate area courses (5- miles) were in the $70s, with one in the $80s (Chevy Chase), one in the $60s and one in the $50s. When we expand out to 10 miles, we find three in the $80s (adding Wilmette and White Deer), ten of the 19 in the $70s, three in the $60s, and three in the $50s. What this is saying is that SCC is priced in the most competitive of the price bands for the area. It would appear that there would be marketing opportunities available for moving up or down a price band. Resident Rates Again, 26 of the facilities offered a discount to residents. The average rate was $64.81. At $64, SCC was right on average for the group and for the immediate area ($64.20). Memberships/Passes Less than half or 44% (14) of the facilities offered a membership or season pass, including three of the seven immediate area courses (Deerfield, Highland Park and Crane’s Landing).

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Bonus Programs (Preferred Player) We could find only one other course (Palatine) that offered a program similar to the Preferred Player Program at SCC among the comparable group. However, their program is not nearly as generous as SCC’s. Their lowest investment is $725, which gains a 10% bonus. SCC’s is $500 which gets a 20% bonus. Their highest level is $1,250, which gets a 24% bonus. SCC’s is also $1,250, but it gives a 50% bonus. Looking outside the comparable list, another area course that offers a similar program is Village Greens in Woodridge. Their incentives range from 20% ($850 investment) to 40% ($1,850 investment). At $1,350 the incentive is 30%. Based on a limited sample, SCC’s incentive program is overly generous. Performance While we were not able to obtain performance data from all the facilities, we did get enough information to be able to judge relative performance levels. Comparable Performance - Revenue Classic Under Distance from SCC 18 5 5-10 10-20 Over 20 All Rounds 2015 29,131 39,027 35,203 30,752 32,500 34,450 2016 27,564 36,938 25,223 26,472 49,078 34,786 % Change -5.4% -5.9% -29.3% -8.6% -4.6% -11.9% Revenue Total Revenue $2,601,566 $4,284,893 $1,712,105 $1,854,639 $2,936,680 $2,588,875 Revenue/Round $46.98 $74.70 $55.60 $86.51 $57.36 $70.13 Green Fee Revenue $1,408,148 $1,046,986 $917,525 $928,310 $1,029,967 $971,635 Revenue/Round $25.43 $23.36 $22.98 $33.82 $20.51 $24.42 Cart Revenue $315,809 $310,247 $300,437 $262,339 $255,575 $279,141 Revenue/Round $5.70 $7.86 $7.27 $11.05 $4.98 $7.84 Merchandise Revenue $230,805 $134,865 $72,474 $120,931 $155,065 $121,782 Revenue/Round $4.17 $4.09 $1.43 $3.00 $3.37 $3.35 Range Revenue $251,139 $136,360 $84,372 $46,520 $169,156 $119,517 Revenue/Round $4.53 $3.16 $2.36 #DIV/0! $3.43 $3.16 Lessons/Academy $364,832 $139,259 $122,000 $3,649 $68,142 $101,928 Food and Beverage $15,014 $2,079,766 $140,060 $853,449 $1,117,489 $1,025,688 Revenue/Round $6.59 $44.03 $1.27 $53.57 $15.59 $33.96

Rounds We have rounds information from 14 facilities for 2016 and 12 facilities for 2015. The average number of rounds reported was 37,086 in 2015 and 34,786 in 2016, with an average decrease of 15.9%, although this is skewed due to Glenview Park’s

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Golf Operations Assessment Competitive Review numbers, which had a 63.9% decrease due to being closed much of the year for renovations. In comparison, the Classic 18 did 29,131 rounds in 2015 and 27,564 in 2016, a decrease of 5.4%. Two facilities showed an increase in play, while seven declined. In the case of SCC, its performance was hampered not only by the weather in 2016, but because of Dundee’s road construction in front of the entrance. Notably, only three facilities reported fewer rounds than the Classic 18 for 2016, suggesting Classic 18 is underperforming in the market. Revenue We measure revenue in two ways – volume as reflected in the total revenue figures and in the rounds, and yield which we measure as revenue per round. We have revenue figures from 20 of the facilities – all municipal except for Cantigny, which is owned by a non-profit foundation. The average revenue per facility was $2,588,875. Three of the facilities reported over $5,000,000 in revenues for 2016, led by Arrowhead at $7,681,258 and Cantigny at $7,657,905, with Village Links at $5,158,503. Chevy Chase, at $4,684,721 was not far behind. SCC placed fifth, with $2,601,566. Notably, the four facilities ahead of SCC all have large banquet operations. Shepherds Crook reported the lowest revenue at $951,290, with Buffalo Grove next at $1,047,259. In total, a little over one-third of the facilities (7) had revenues over $2,000,000. In terms of revenue per round, the average was $70.13. Sportsman’s averaged $46.98/round (when you include East 9 play). This was the 10th of the 12 facilities for which we had both rounds and revenue figures. Chevy Chase, with $152.65 per round in total revenue, led the way, followed by Arrowhead ($137.66). Yield then falls sharply to the next highest, which is Bridges at Poplar Creek ($77.89) and Village Links ($71.65). Green Fee revenue averaged $971,635, or $24.42 per round. Village Links had the highest green fee volume with $1,800,477. It was followed by Arrowhead at $1,613,450 and SCC at $1,408,148 (which includes the East 9). Notably all three courses have 27 holes, with Village Links having the same set-up as SCC with a stand-alone 9. When we look at Green Fee yield (GF revenue/round), we find that SCC’s $25.43 places fourth among the 11 courses that we have data for. The highest yield reported was Steeple Chase at $34.38/round, followed by Chevy Chase at $33.26 and then falling sharply to Arrowhead at $28.91. Cart Revenue averaged $279,141 for the 17 facilities reporting. SCC’s $315,809 placed sixth. However, yield is the more important statistic in this case. For all courses, the average was $7.84/round. Bridges at Poplar Creek had the highest average at $12.97, followed by Steeple Chase at $12.37 and Chevy Chase at $11.28. SCC’s average of just $5,70 ranked 10th among the facilities reflecting a low cart-usage percentage of 42.4%. For the other two 27-hole facilities, Arrowhead averaged worse at $5.57, while Village Links fared better at $6.62.

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The average revenue for the driving range (11 reporting) was $119,517. Village Links led the way with $261,761, followed closely by SCC at $251,138. They were the only facilities doing over $200k. But in terms of range revenue per round, SCC led the way at $4.53, which is over four times the national average. Bridges at Poplar Creek was second at $4.23/round. The average for all eight courses reporting was $3.16. Six facilities reported lesson and clinic income. The average for the six was $101,928. Here SCC was the clear leader at $364,832 with Glenview Park’s $122,000 a distant second. SCC also did excellently when comparing merchandise sales. Schaumburg reported the highest volume of the 15 facilities reporting, at $257,771. But SCC was a close second at $230,805. The average for all 15 was $121,782. In terms of yield, SCC’s $4.17/round was second only to Wilmette’s’ $4.26. The average for the 11 facilities reporting was $2.97. Food and Beverage sales is where we have the biggest spread among the facilities. This largely can be attributed to the fact that several of the municipalities contract out the F&B service, including SCC. For the 12 facilities reporting, the average volume was $1,025,688 – but that includes the facilities that lease out the F&B. When those are taken out, the average jumps to $1,358,264. Arrowhead had the highest volume with $5,230,154. Chevy Chase came next at $3,057,274 followed by Village Links at $2,218,977. Bridges almost broke the $1m barrier with $995,131. SCC’s revenue was $15,000 from its lease. It terms of yield, the average for the 8 courses reporting was $33.71/round. When the leased facilities are removed, the average jumps to $38.47. Chevy Chase skewed the data with $99.62/round, followed by Arrowhead ($93.73), Bridges ($31.78) and Village Links ($30.82). None of the others had over $8/round. Expenses The average total expenses for the 20 facilities reporting, was $2,149,962. Seven facilities, including SCC, had expenses over $2m, led by Arrowhead at $7,010,655, Village Links ($4,585,449) and Chevy Chase ($4,144,793). SCC’s $2,513,664 came in fourth. The average expenses per round was $71.22. Here, SCC’s $45.39 ranked 10th of the 13 facilities reporting. This reflects the fact that SCC is both 27 holes and leases out its F&B concessions. Maintenance expenses averaged $769,129 (nine reporting), ranging from $369,056 at Shepherds Crook to $996,00 at Arrowhead. SCC’s $917,879 came in third behind Winnetka’s $960,412. Wilmette was not far behind at $901,631. Notably, Winnetka does have a par 3 course included, but Wilmette is an 18-hole facility. Comparable Course Expenses

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Distance from SCC (in Classic Under Over miles) 18 5 5-10 10-20 20 All Averages Total Expenses $2,513,664 $2,725,449 $1,490,880 $1,794,526 $4,144,112 $2,149,962 Expenses/Round $45.39 $90.40 $61.20 $63.66 $94.66 $71.22 Payroll $863,792 $1,107,851 $699,532 $905,850 $1,714,837 $982,651 # Full time employees 9.00 9.50 4.25 6.00 12.00 6.60 Maintenance $918,879 $918,879 $858,576 $643,047 $713,820 $769,129 Maintenance Payroll $453,578 $447,374 $386,075 $367,412 $361,089 $387,364 Net Operating Income ($88,871) $221,927 ($1,487) $71,722 $452,905 $124,801 Net Operating Income The bottom line is how much the facility could generate in terms of profit. Here we are using Net Operating Income as our measure, or “NOI”. Net Operating Income is found by taking the total revenue and subtracting cost of sales and operating expenses. It does not consider depreciation, debt service or capital expenses. We have tried to eliminate these items from the operating expenses to provide a more accurate comparison. However, not all the financials were detailed to the point where we could determine these non-operating expenses and thus, their expenses may be inflated, affecting their NOI. We have data from 19 operations. Eleven (58%) showed a positive NOI (profit), while eight (42%) had a loss. Overall, the average reported NOI was a positive $124,801. Arrowhead had the best NOI at $670,603. It was followed by Village Links at $573,054, Chevy Chase ($528,928) and Wilmette ($300,172). Notably, the top three courses all have large restaurant/banquet operations. (Unfortunately, we do not have data from other operations that have large banquet operations). Sportsman’s reported a negative NOI of $72,951, placed it 15th of the 19 facilities. Driving Range The average price for a small bucket of balls was $5.53, with an average of 32.31 balls per bucket. SCC is slightly under that average at $5. However, the price per ball average (17 cents) was the a little higher than the average (16.4 cents). For large buckets, the average was $10.73 for 85.63 balls, an average of 12.7 cents each. SCC is a bit under this average, offering 80 balls for $9, for an average of 11.3 cents each. There would appear to be room for an increase at SCC. East 9 We compared the East 9 to other stand-alone 9-hole courses in the area. There are only five such facilities, including the East 9.

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Facilities The East 9 is most similar in set up to Village Links, which also offers a stand-alone 9 to go with a championship 18-hole course. The other three facilities are stand- alone 9-hole courses. In terms of length, four of the facilities are over 6,000 yards from the back, and Mission Hills is at 5,960. The average is 6,208. At 6,020, the East 9 is close to the average of 6,106. Its slope value from the back tee (121) is also close to the average (122.4). Both Village Links and Mission Hills are much tougher (130 and 129). The East 9 is also in-line with regards to length from the middle tees. At 5,658 it is close to the average of 5,690. Only Village Links, at 6,152, is over 6,000 yards from the middle. From the forward tees, the East 9 is significantly longer than the average. The East 9 measures 5,322 yards from the forward tees, which has a par 72 equivalent of 5,474. The average is 5,082. Village Links, at 5,488 is the longest. Two courses, Rob Roy (4,528) and Willowhill (4,540) are under 5,000 yards. Again, though, when we adjust for the difference in distance driving the ball between men and women, we find that the average for all courses is 7,260 yards! Village Links (7,840) and East 9 (7,820) lead the way. Only Rob Roy (6,469) equates to a yardage preferred by most men. Again, there is a fantastic opportunity to dominate the women’s market by adding new forward tees in the range of 2,200 yards for nine holes. Please note that the East 9 does have a “family” tee that is much shorter than the forward tee. This tee is designed for children and is simply two markers in the fairway. It is not a “real” tee in the sense that it does not have a built-up teebox, etc. Very few adults would ever use it, expect possibly when playing with their children. Four of the five courses have ranges, with Mission Hills being the exception. Fees For nine holes, green fee and cart, the average fee was $31.20 for non-residents and $27.17 for residents during the week. (Three of the courses offer resident discounts). The East Nine at $34 and $30, respectively, was the highest priced. Rob Roy, at $27 and $24, was the lowest. On the weekend, the average non-resident rate was $35.60. At $39, the East 9 was the most expensive. For residents, the average was $30, with the East 9 again being most expensive at $34, with the next highest at $30. Performance We do not have performance figures for any of the 9-hole facilities.

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Anetsberger We looked at nine par 3 courses in the area. Two of them were part of multi- course complexes, Winnetka and Cantigny, while the rest were stand-alone. Lake Park is an 18-hole par 3 course, while the rest are just 9 holes. The average age for the facilities is 45.9 years, with the newest being the Golf Center of Des Plaines, which opened in 1997. Of course, Anetsberger was renovated in 2004. The average length from the back tees is 2,142 yards, ranging from 1.515 at Lake Park to 2,466 at Nickol Knoll. AGC is at 2,256. Only four of the nine have driving ranges. Two of the courses offer golf carts (Nickol Knoll and Walnut Greens). The average fee for non-residents for nine-holes is $13 during the week, which is what AGC charges. For residents, the average is $10.80. For weekends, the average rate is $13.89 for non-residents, with AGC second highest at $15. The highest is Walnut Greens at $19.50. Performance We have revenue figures for six of the courses. The average revenue was $408,875. However, this is skewed due to Golf Center’s $1,559,968. The other facilities averaged $178,656. AGC, at $125,937 was second lowest, just behind Walnut Green ($125,169). We only have rounds information from one other facility. Nickol Knoll did 16,771 rounds compared to AGC’s 10,834. The six firms reporting averaged $344,324 in expenses, led by Des Plaines’ $1,033,471. When it’s not counted, the figure drops to $206,495. At $97,746, AGC had the lowest expenses of any of the facilities. Only two of the facilities showed a positive NOI and AGC was one of them at $17,052. Of course, that pales against the Golf Center’s $526,497 – but that is a completely different kind of facility with a three-story driving range and a short- game area that you pay by the hour to use. Performance Analysis We had a large enough sample of courses that provided performance information (23) that allowed us to look at numerous factors to see how they correlated with performance. The table below shows the results of this analysis. SCC’s position in each group is highlighted in yellow. “# Pos” and “# Neg” refers to the number of courses with either a positive or a negative NOI. The three key performance indicators would be number of rounds, net operating income (NOI) and the percentage of courses reporting a positive NOI in that group. As you can see, some factors correlate more strongly with performance than others. However, with the sole exception being Peak Fee, SCC is in the lowest performing group in each case. Below are some of the key findings:

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• Par: There did not seem to be a strong correlation between Par and performance other than the average revenue and NOI were both highest for the par 72 courses. But this may be confounded with other factors. • Household Income: Perhaps surprisingly, there was a reverse correlation between the average household income of the community where the golf course is located and performance. Rounds and revenue correlated positively, but NOI did not. Performance by Grouping # # Avg Rounds Avg Rev Avg NOI Pos # Neg % Pos By Par Par 70 6 30,461 $1,838,059 $41,710 2 3 40% Par 71 3 42,697 $1,374,337 $33,620 1 1 50% Par 72 14 34,909 $3,103,080 $163,204 7 7 50% BY HH Under 70k 5 31,750 $1,875,309 ($9,546) 3 1 75% 71-99k 11 32,929 $2,583,299 $166,272 5 2 71% Over 100 6 41,431 $3,498,397 $157,904 2 4 33% By Yardage Under 6,500 8 35,489 $1,467,145 ($6,505) 2 4 33% 6,501-6,800 7 34,489 $2,015,337 $69,791 4 2 67% over 6,800 8 32,344 $3,860,326 $284,500 4 2 67% By Peak Fee Up to $65 7 36,332 $1,273,279 ($57,153) 1 4 20% $66-75 8 33,954 $2,075,500 $95,068 4 3 57% $76-$85 4 34,838 $3,948,160 $305,010 2 1 67% over 85 4 27,354 $3,772,491 $257,153 3 100% By Google Rating Under 4 5 31,952 $1,875,309 ($9,546) 2 1 67% 4.0-4.2 8 32,479 $2,274,020 $170,542 1 6 14% 4.3+ 10 37,637 $3,150,903 $151,950 8 1 89% By F&B Income Under $100k 4 32,797 $1,633,223 $16,896 1 2 33% $100-250k 4 29,059 $1,883,110 $32,682 2 2 50% over $900k 4 35,400 $2,662,799 $238,392 4 - 100% • Yardage: There was a strong relationship with yardage and performance as indicated by the average NOI and percentage of facilities with a positive NOI. Half of the facilities reporting a negative NOI were under 6,500 yards in length. • Peak Fee: The higher priced facilities tended to perform better. The highest priced facilities had the best NOI. Price is generally perceived to be an indicator of quality in the minds of the consumer.

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• Google Rating: Google ratings above 4.3 seemed to be the line of demarcation in performance. Facilities ranked 4.3 or higher were significantly more likely to have a positive NOI. • Food and Beverage Income: Unfortunately, the sample size of facilities that provided F&B numbers was small. We grouped them into three categories: (1) revenues under $100,000, (2) between $100,000 and $250,000, and (3) over $900,000. The facilities with revenues under $100,000 generally leased out the F&B operation. Those between $100k and $250k had F&B operations, but did not do a lot of banquets. Those over $900k had significant banquet operations. Here we did have a very strong correlation. The four facilities that leased out F&B, were more likely to have a negative NOI. The one exception was Thunderhawk, which checks off most of the other categories associated with strong performance above. The group that did not lease out F&B and did not do banquets, fared the worst in terms of average NOI. The clear winner, though, were the four facilities that also had significant banquet facilities. Combined, these four clubs averaged having a positive NOI of over $500,000. All of them were profitable.

Discussion When we look at the overall market, we see a big cluster of courses that are priced similarly, with a peak fee in the 70s. Going up or down in the market – either to the 60s or up to the 80s, would result in less competition. However, both have significant disadvantages. Going down in price might lead to increased volume, but it would also lead to a decreased yield. Given that SCC is doing a combined 55,000+ rounds between the Classic 18 and the East 9, it is already performing well, although not great. Based on the reports from competition, we could see the Classic 18 reasonably generating between 30k and 35k rounds, which it has done in the past. But if you are decreasing the fees by 10% to gain 10% more rounds, are you really gaining? Further, when you look at the affluent nature of Northbrook, would a lower fee facility fit the desired image? On the other hand, the facility as it currently is configured, simply is not on a level where it could justify a price jump into the 80s. To get there, it needs a new clubhouse, improved range and an improved golf course – in other words a major renovation. But with such a renovation, we may be able to both increase yield and volume. Course-wise, the Classic 18 needs to be stretched at both ends. It is far too short to attract the better golfers, which make up at least 15% of the market. That is a significant market share that is not being addressed. But the fact that it is considered a “short course” also hurts play from other golfers as they do not want to play a course with a negative stigma, even though the tees are appropriate for their game. Ideally, we would like to see a length of 6,600, which would enable it to qualify for PGA tournaments and should be long enough to attract most skillful

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Golf Operations Assessment Competitive Review players and lose the “short” stigma. We also note a strong relationship between length and performance, with shorter courses performing at a lower level. On the other end, the forward tees need to be moved up considerably. There is an outstanding market opportunity to dominate the market for women players at both the Classic and East 9 by making the course (and clubhouse – but more on that later) friendlier to women. And the women’s market is significant and growing. In the Chicago area, about 20% of the players are women, which is much higher than the national average. But the strongest indicator of performance as determined by Net Operating Income was the presence of a significant banquet operation. Impact of Renovations and Rebranding There is another big reason to consider a major renovation. Our research has shown that municipal golf courses that undergo major renovations see a significant improvement in both rounds and revenue. And if that renovation includes a rebranding of the facility, the results are significantly better. We conducted a study of municipal courses in the Dallas-Ft. Worth (“DFW”) market in conjunction with the NGF. The DFW area is an appropriate choice for such a study, given the considerable number of municipal courses in the area, and the number that have undergone major renovations in the past 10 years. The study’s results are provided in Appendix C. East 9 The East 9 stood out to us the first time we saw it, because it did not seem to fit well with any model. It clearly was not the quality of the other two nines, which would allow the facility to operate as a true 27-hole facility. Yet it wasn’t so much shorter or less difficult that it would attract a much different market. Yet it is doing well, with over 27,000 rounds. This suggests to us that it would not gain a lot by doing a dramatic improvement to try to make it the equal of the other nines. We also have another similarly configured facility in Village Links that Is doing very well as an 18 plus 9. Nor does there appear to be enough room to significantly lengthen the course. Making it very difficult to bring it to the level of the two nines on the Classic 18. However, we do feel that it may be priced too high for the quality of course provided. The pricing strategy being used is to price it at 55% of the Classic 18. This model works if they are of equal quality and could be used for pricing 9-hole play on the Classic 18 (although we recommend 60%). But the East 9 is not at that level. We feel a 10-15% price reduction would further increase demand and help attract more play from outside the immediate area. On the other hand, we would promote more 9-hole play on the Classic 18, with a higher price point. We greatly applaud the family tees and the family pricing strategy. But as our survey shows, awareness of these programs is low. More about this later.

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We strongly recommend moving up the forward tees to at least 2,200 yards. This would dramatically increase its appeal to women and juniors and significantly improve the pace of play. As with the Classic 18, a shorter forward tee will allow the East 9 to dominate the women’s market. Anetsberger Anetsberger appears to be positioned appropriately in the market and is performing decently, although far below its capacity. We will talk more about strategies to improve performance later. Foot Golf One strategy that makes sense for Anetsberger is adding foot golf. Foot golf is basically a combination of soccer and golf. Instead of a golf ball and golf clubs, players use a soccer ball and their feet. Instead of a cup, they hit it into a net that is usually placed near the green. Foot golf is gaining in popularity across the country, but it still is not a major revenue producer. At Village Links, for example, they attribute less than $10,000 in revenue to foot golf. However, it fits wonderfully with the other activities at Techny Prairie Park and Fields and the course is the ideal length. We think it could do very well and the cost is minimal. Enterprise Funds Of the municipal courses, it is interesting to note that most them had the golf operation within an Enterprise Fund. Another three had it in a “special” fund. Two had them as part of the general fund, with the rest unknown.

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We looked at the financial performance for the facilities. We examined some historical trends as well as diving in greater detail on recent performance. Detailed financials are presented in Appendix E. Rounds Below is a 10-year historical graph of rounds at both Sportsman’s and Anetsberger.

NPD 10-Year Rounds History

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0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Anets Sports Linear (Anets) Linear (Sports)

As can be seen, performance has been mostly stable, with some variation most likely due to weather. There is a slight downward trend at Sportsman’s, with a slight upward trend at Anetsberger. The 10-year high for SCC was in 2012, with 62,155 rounds. For AGC, it was a year later in 2013, with 12,325. The 10-year low for SCC was last year at 55,026, although in two other years (2008 and 2014) were also in the 55,000’s. The average for SCC over the 10-year period was 58,336. For AGC, the low occurred in 2011 with just 8,599 rounds. The facility averaged 10,511 rounds over the 10-year period. We can see that SCC last year performed 5.6% below average while AGC was 3% above. No doubt the road construction on Dundee was a major factor in the decline in rounds last year. Below are the most salient results. It should be noted that the rounds counts may be slightly different than previous reports as we subtracted items, such as lump

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Golf Operations Assessment Performance Review sum payments, that were previously counted as rounds. But these items totaled under 100 rounds. Classic 18 Appendix E has a table showing the performance of Classic 18 over the past three years, broken down by type of round. As we can see, rounds jumped 3% from FY14-15 to FY15-16 before falling 9.9% last year. It is widely believed, with justification, that the drop-in performance last year was largely due to the highway construction. It should be noted that we have included 9-hole rounds played on the Classic 18, which also includes 9-hole leagues that alternate between the East 9 and Classic 18. Overall, weekday rounds (Monday-Friday) accounted for nearly two-thirds of the play (64%) last year. This dropped from 66% last year, but is consistent with the previous year. The decline in weekday rounds last year (2,546 or 12.7%) made up the bulk of the total rounds lost (3,018). In contrast, weekend rounds declined by 483 or 4.7%. The percentage of play on the weekends is a little below expectation (40%), but this may be more a reflection of doing a better job on weekday rounds than it is doing poorly on the weekend. Other items of note include: • 9-hole play accounts for about 5% of the play on Classic 18 over the past three years, as most 9-hole play is directed to East 9. The evening leagues, however, alternate between the courses. • Rack Rate Rounds, defined as the regular fee a non-resident would pay walking in, without any discounts (i.e., the highest rate applicable) accounts for about 12% of the play (12.1% over three-years). The percentage has remained relatively stable, although they did decline at a slightly higher rate than overall rounds last year (11.4% vs. 9.9%). The rack rate rounds reflect Classic 18’s ability to attract non-discounted occasional play from outside Northbrook. • Non-resident rounds, which do NOT count the non-residents who bought discount cards, or preferred players, or permanent tee-time holders, accounted for about one-third of the play (31.4% over the three years). This percentage has held relatively steady over the three years. • Twilight (about 10%) and Supertwilight (a little over 3%) percentages are right at expectation. • Weekend Rounds have declined each of the last two years. This is a concern as they are the most lucrative. • Junior Rounds have also decreased each year, although they make up a relatively small percentage of overall play (about 3%) • Permanent Teetimes have also declined each of the past three years, from 3,597 in 2014 to 2,867 last year. These are the prime rounds on weekend mornings. This is not necessarily a bad thing as these times are the highest

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yielding teetimes, but the permanent teetime holders typically utilize the highest discounts possible. So theoretically, the lower yielding permanent teetime slots can be filled with high-yield rack rate rounds. • Complimentary and Promotional Rounds, which include promotions such as Golf Now, Groupon, where the round itself does not generate a green-fee, has steadily dropped, from 2,997 in 2014 to 2,123 last year. • Specials and Other Discounts make up just 2.2% of the play over the 3- year period. The last two years, it was 2.5%. • Seniors, on the other hand, have steadily increased their share of the rounds, going from 3,797 or 12.8% in 2014 to 4,150 or 15.1% last year. This may reflect the aging of the area. Seniors make up a sizable percentage of weekday rounds. Seniors at the Classic 18 are not given a special rate on weekends and so their rounds on weekends are not tracked. • Preferred Player rounds have grown from 4,295 (15.1%) in FY14-15 to 5,708 (21.6%) of the play in FY 16-17. This is both good and bad. Its good because the Program is gaining in popularity, but these rounds are highly discounted due to the generosity of the Program. Preferred players at the top end are getting essentially a 33% discount on top of any other discount. Discount card holders receive about a 16% discount on the rack rate. Combine these discounts, and almost all preferred players have the discount card as well, and the combined discount is about half (44%) of the regular rate. • Discount Card Holders, which are made up of both residents and non- residents, accounted for over half (51.8%) of the play over the past three years. This percentage has increased each year, from 50.9 in FY14-15 to 52.6% last year. East 9 The East 9 course produced almost as many rounds as the Classic 18. In fact, last year the East 9 produced 859 more rounds than Classic 18 (28,304 compared to 27,445). Of course, these rounds are a lot lower yielding as the base price for an East 9 round is 55% of the Classic 18. All the rounds on the East 9 course are 9- holes. As we will discuss more in the customer feedback section, the market for East 9 is very different from Classic 18. There is not a lot of cross-over, except for the evening leagues that rotate between the courses. Salient findings include: • East 9’s rounds did not decline as sharply as the Classic 18’s last year, losing only 1.7% of its rounds. Further, its increase in rounds the previous year was stronger (5.7% vs. 3.0%). This may indicate that the East 9’s popularity is gaining while Classic 18’s is shrinking – although the trend is still small.

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• Weekday play is even stronger on East 9, as it accounts for 71.2% of its play over the three-year period. This is largely due to the number of leagues that play on the course during the week. • Discount Card play accounted for an average of 44.1% of the play over the last three years. This percentage has steadily increased from 40% in FY14- 15 to 49.6% last year. • Non-Resident Play, on the other hand, has sharply fallen off, from 54.7% of the play in FY 14-15 to just 41.1% of the play last year. Last year’s drop of 3,126 rounds (21.2%) was six times greater than the overall drop in rounds (510). • League Play accounts for 5.5% of the play. This percentage dropped significantly last years, from 5.6% to 5.1%. • Seniors account for more play on the East 9 course, with 17.3% last year, up from 16.8% the previous year. • Twilight Play accounts for a much lower total on the East 9 course, with just 4.1% last year. This again, may be accounted for by the number of leagues that play during this period that are not counted as twilight. • Preferred Players made up about 7.9% of the play over the last three years. This is a lot lower percentage than for the Classic 18 (18.3%). It also dropped sharply last year, from 8.1% of the play to 7.1%. • Specials and Discounted Rounds have increased sharply over the last three years. In FY14-15, they accounted for just 56 or 0.2% of the play. Last year, this number was 1,643 or 5.8%. Anetsberger Anetsberger produces a lot fewer rounds than its bigger brothers, averaging 11,400 rounds over the past three years. Last year, though, saw the fewest rounds at 10,802, a decline of 7.6% (894 rounds) from the previous year. Notably, highway construction cannot be blamed for this drop. • Weekday Rounds dropped by 1,248 rounds, more than the total loss. This represented a decline of 14.2% over the previous year. The year before, though, weekday rounds had increased by 3.9% • Weekend Rounds, conversely, increased by 301 rounds last year, after declining by 323 the previous year. However, the percentage of weekend rounds is still lower than expectation, which is a cause for concern as these are the highest yielding rounds and a wonderful time for the family to get together and play. It should be noted that an equal distribution of rounds over the seven days of the week would result in a 28.6% share for the weekend. The fact that AGC is only slightly above this average is noteworthy. • Youth Rounds dropped sharply by 920 rounds last year, or 20%. They had risen by 477 the previous year,

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• Rack Rate Rounds averaged 22.8% of the play over the three-year period. • Senior Rounds have steadily increased its percentage of play each year, from 14.6% in CY14 to 16.4% in CY15 and 17.2% last year. However, the total number of rounds from seniors actually fell slightly last year (3.1%). • Member Rounds accounted for an average of 16.6% over the three-years. The number of member rounds increased by 373 in CY15 before falling by 171 last year. Revenue We looked at revenue over a 4-year period. In that time frame, the total revenue for the golf operation has held remarkably steady, going up and down by less than 2% each year. However, the picture changes a bit when we look at the various departments. 4 Year Revenue History FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 Average Sportsman's Golf $1,988,936 $2,004,396 $2,057,978 $1,966,047 $2,004,339 Range $267,889 $285,026 $281,421 $251,139 $271,369 Academy $260,661 $279,213 $298,339 $364,832 $300,761 Anetsberger $128,068 $129,704 $122,254 $125,937 $126,491 Other $23,815 $22,891 $3,024 $13,431 $15,790 Total $2,669,369 $2,721,230 $2,763,017 $2,721,385 $2,718,750

Total Revenue The total revenue for the golf operation has fluctuated from a low of $2,669,369 in FY13-14 to a high of $2,763,017, before falling back last year slightly Total Revenue 4 Year History last year (1.5%) to $2,721,385. The fact that there has been such $2,800,000 stability is a testament to the staff $2,750,000 at the facilities. $2,700,000 The chart to the right shows the four-year history. Because of scale, $2,650,000 the chart is exaggerating the $2,600,000 amount of change seen during this FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 four-year period. However, it is clear that the facilities were trending upwards until last year, when the road construction no doubt slammed on the brakes of the growth.

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Green Fee Green fees make up over 50% (an average of 51.4% over the last four years) of the total revenue for the Golf Division. As a result, they deserve a bit more attention. We want to point out that we looked at the yields for each rate category for all the courses. There was very little deviation from what was being charged versus the posted rate for that category, which means there is little discounting going on at the register. Classic 18 Green Fee Revenue Another table in Appendix E shows the same breakdown of round types as seen above, but this time showing revenue. Consistency

We look closely at the revenue per round (rev/rnd) figures as they measure yield. And as we can see, that while the number of rounds has fallen, the yield or revenue per round has improved each of the past three years. In FY 14-15, green fee revenue/round was $30.94. This increased slightly (0.8%) in FY15-16 to $31.18 and then increased 4.4% ($1.38) last year to $32.56. This improvement helped offset the 9.9% loss in rounds, resulting in a decline of just 4.4% in green fee revenue last year. Perhaps most notably, the rack rate gf/round increased by $2.26 (5%) last year to $47.13. This may reflect a higher percentage of rack rate rounds on the weekends, which, in turn, may be due to a decrease in the permanent teetimes. As would be expected, the rack rate rounds had the highest overall yield. Over the three-year period, rack rate rounds averaged $14.11 more than the average overall yield, for a 44.7% difference. The sharpest contrast can be seen between the yield for weekday vs. weekend rounds. Over the three-year period, the weekday rounds averaged $24.89 in green fees, while weekend rounds averaged 71% more at $42.63. This does greatly illustrate the supply and demand principal as weekend rounds are in much higher demand. The actual yield difference contrasts sharply to the rack rate differential of 10% between weekday and weekends. Permanent teetime holders averaged paying $43.93 per round, or roughly a 20% ($11.07) discount off the rack rate of $55. East 9 The East 9 rounds averaged $18.39 each in green fees last year, and $18.46 on average over the past three years. The 58.6% differential to the Classic 18’s $31.53/round over the same period is very consistent with the pricing strategy of pricing the East 9 at 60% of Classic 18. We do not see, though, the trend upwards in yield like we did with Classic 18. Yield decreased slightly last year, from $18.62 to $18.39. We also note that there is not as strong a difference between weekday and weekend play, although the difference

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Golf Operations Assessment Performance Review is still significant. Weekday rounds over the 3-year period averaged $16.11 per round, compared to $23.06 for the weekend, a 43.1% difference. Rack rate rounds average $24.91 over the three-year period. Notably, the trend has been upwards, going from $24.10 in CY14 to $26.56 last year. We do note that the difference between the average rack rate round and the average of all rounds is $6.44, or 34%. This is not as great as the 44.7% ($14.10) difference found with Classic 18. League rounds, perhaps surprisingly, had a higher overall yield ($20.23 over the three-years) than the average for all play. This is over $4 or 25% higher, than the average yield for weekday rounds, when the leagues are playing. This demonstrates the importance of league play to overall profitability. Anetsberger Anetsberger averaged a green fee yield of $6.60/round over the past three years. This went up about 20 cents last year after going down 40 cents the year before. Anetsberger 3-year Green Fee History

CY 2014 CY 2015 CY 2016

Rev rev/rnd Rev rev/rnd Rev rev/rnd Total $78,701 $6.72 $73,823 $6.31 $73,456 $6.80 Weekday $48,878 $5.78 $48,961 $5.57 $43,540 $5.78 Weekend $29,823 $8.99 $24,865 $8.30 $29,916 $9.08 Senior $9,790 $5.72 $8,901 $4.65 $10,246 $5.53 Youth $21,018 $5.09 $21,626 $4.70 $18,190 $4.94 Preferred $1,160 $11.72 $1,278 $11.83 $1,393 $12.78 Player Rack Rate $35,816 $13.02 $31,966 $12.91 $36,210 $14.01

There is a 54.3% difference between average yield for weekday ($5.78) and weekend ($9.08). This again illustrates the importance of building greater weekend play. Rack rate rounds averaged more than double (126.4%) of the revenue of the overall rounds, coming in at $13.31 over the three-year period. This is perhaps due to the high discounts and volume of play from seniors ($5.28 average yield) and juniors ($4.90 yield). Memberships generated $26,428 in fees last year. But there were only 1,900 member rounds, resulting in a yield of $13.91. This is a savings over the rack rate, but a lot more than we see for other rate categories. It should be noted that the senior and youth rounds above do include the member rounds for these categories, which reflects why the yield is so much lower. When

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Golf Operations Assessment Performance Review the membership fee is added to the green fee, the yield overall jumps from $6.80 (last year) to $9.25. Cart Revenue Golf Cart revenue is the second biggest revenue stream at the golf courses, averaging $330,406 over the past four fiscal years. Last year was the lowest, at $317,454. The highest was in FY13-14 with $350,486. Cart revenue is not broken down by course, but by 18-holes and 9-holes. Obviously, all the 18-hole carts are played on the Classic 18, but so are some of the 9-hole carts. There are some 9-hole leagues that rotate onto the Classic 18, plus there is a very limited amount of 9-hole daily fee play. In looking at the Calendar Year Item Sales Report, we note there were $212,154 in 18-hole cart sales on 12,710 transactions for an average of $16.69 per. For 9-hole carts, the total was $103,655 on 10,779 sales, for an average of $9.62. However, the usage figures are not consistent with interviews or observations. The 12,710 18-hole cart sales represent only 48.6% of the 18-hole rounds. And the 10,779 9-hole cart sales are just 37.4% of the 9-hole play. And some of those were actually 18-hole rounds where the player walked the front side and rode the back. On the other hand, the customer survey showed 48.2% of the Classic 18 customers and 62% of the East 9 customers do walk, so the numbers may not be off that far. We certainly would encourage the starters to be rigorous in checking receipts to make sure that the cart fee is included when the player is riding. Other Revenue Sportsman’s Golf Courses It becomes very difficult, if not impossible, to try to separate revenue streams, other than green fees, between the two courses as SCC. So, for this discussion, we have combined them. The next biggest generator was in proshop sales, which averaged $230,899 over the four-year period. However, its lowest year was in 2010 ($215,633) while its highest was the year before last at $241,785. When we take out cost of sales, we find that the net merchandise sales averaged $51,601 over the last four years, with an average cost of sales of 77.5%. This cost of sales figure is very high. The national average is 70%. On the positive side, net merchandise sales increased 9.5% last years, despite the 5.7% decrease in customers (rounds). We believe the biggest reason behind the excessive cost of sales is the absence of high-margin items such as logo shirts and caps. We will talk more about this in the Operations section. Program fees, which include league and tournament fees, generate an average of $64,368. In this case, Program fees have steadily increased with last year being the highest at $68,865 and FY13-14 was the lowest, at $61,874.

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Naturally all the revenue figures are going to fluctuate with rounds as rounds equates to customers. Thus, looking at revenue/round or yield provides a better indicator of trends than total revenue. As previously noted, green fee revenue/round has gradually increased over time, from $24.40 in FY14 to $25.02 last year. Cart fee revenue, though, has trended downward. It averaged $6.13 in FY 14, but for the last three years, it has averaged around $5.65. Weather may be playing a significant role in this as the number of days that carts are not allowed has increased. Proshop sales increased from $3.77 per rounds in FY13-14 to $4.15 the following year. Since then, the yield has remained mostly stable. But when we take cost of sales into consideration, the picture changes. The cost of sales percentage dropped last year from 79.6% (a four-year high) to 76.9%, resulting in a 16.2% increase in the net yield, from $0.83 to $0.97 per round. We also took a more detailed look by examining the item sales report for last year. Here we discovered that cart usage was 48.6% of the play for 18-hole play and just 37.4% for 9-hole play. The actual percentage for East 9, though, may be lower as many players will walk the first 9 holes of the Classic 18, then take a cart for the 2nd nine. On the other hand, 3.8% of the players take a push cart for 18-hole play, while 9.1% take it for 9 holes. This does indicate that the players playing East 9 are different than those that play Classic 18, a fact that we will confirm later. The overall cart usage figures are lower than expectation. The high percentage of walkers no doubt contributes to a slower pace of play. Driving Range The driving range has averaged $262,955 over the past four fiscal years. Last year, saw a sharp drop (10.8%) from $272,458 to $242,900. The road construction on Dundee was likely the main culprit in this drop. Notably, other than last year, the range revenue did not fluctuate much with rounds. This strongly indicates that most of the range business is range-only, as opposed to golfers hitting a bucket before they play. Thus, the range at Sportsman’s is more like a stand-alone range than the typical golf course range. It should be noted that the range revenue also includes the miniature golf. The minigolf averaged $23,600 each year on a little over 5,000 rounds of play. Its income has been remarkably stable. Play on the miniature golf course was evenly split between weekday and weekend. Over half the play was from juniors. Range buckets averaged close to $250k in FY13-14 and FY14-15 before falling 11.8% last year to $219,404. This is greater than the percentage loss seen at the golf courses and leaves us to believe the construction had a bigger impact. This is logical as the range fronts Dundee Road and likely gets a lot of drive-by business. However, we also note that there was a change in management at the range last year that may have also had an impact on sales. Last year, there were 21,813 buckets sold. If few customers bought more than one, this means the range saw over 20,000 customers last year.

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This is further reflected in its very high revenue per round figure. Over the past four years, the range and miniature golf combined have averaged $4.75 per round played at SCC. This figure has dropped significantly over the past three years. In FY14-15, the range averaged $5.03 per round, while last year the average was just $4.50. Still, this average is about four times the national average for golf course ranges. Academy The Golf Academy has produced a strong revenue stream that continues to grow. Last year, revenues jumped 22.3%, or $66,493 from the previous year. Revenues have grown 40% ($104,171) since FY14-15. Sportsman's Academy Revenue FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

PROGRAM FEES

Program Fees $121,897 $129,360 $175,810 $215,036 $160,526

Golf Private Lessons $138,764 $149,853 $122,529 $149,796 $140,235

PROGRAM FEES $260,661 $279,213 $298,339 $364,832 $300,761

Total Revenue $260,661 $279,213 $298,339 $364,832 $300,761

When we take out the cost of sales (the fees paid to the pros for teaching), the growth is even more impressive. Over the last three years, the net revenue has increased by 173.9%, from $76,113 to $208,483. This revenue helped offset the decrease in revenue from SCC and the range last year. Anetsberger AGC’s revenue is the fourth largest, behind the SCC golf courses, the range and the academy. It’s revenue stream has been up and down. It grew slightly from FY13- 14 to FY14-15, before falling in FY15-16 and then climbing back some last year. Over the four-year period, total revenue has gone down 1.7% from $128,068 in FY13-14 to $125,937 last year. Notably, membership revenue has increased by 25.7% over the four-year period, going from $21,076 to $26,491. Merchandise sales, although not strong, has also increased over the period by 12.1% Next, we will look at revenue per round. Revenue per round has increased 10.4% over the past four years, from $10.45 in FY13-14 to $11.54 last year. Over the four years, it has averaged $10.81. Last year alone, it went up by 10.4%.

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Green fee revenue has averaged $6.62 over this period. However, it has gone down slightly from FY13-14 (0.9% or 6 cents). This can be attributed to the growth in membership sales. Membership fees on a per round basis has jumped 41.2%, from $1.72 in FY13-14 to $2.43 last year, averaging $2.03 over the time frame. When we combine the green fees with memberships, we see the combined revenue per round has increased 7.6% over the past four years, from $8.55 in FY13-14 to $9.20 last year. The average over the period was $8.66. Merchandise sales averaged $1.56 over the four-year period. This is not far off the national average for merchandise sales for municipal facilities of $2.48 and is in line with the average for value facilities. Merchandise sales at Anetsberger had an average cost of sales of just 62.3% average, which is excellent, although the volume was low.

3-Year Revenue History

$3,000,000 The chart to the right $2,500,000 shows the $2,000,000 three-year history of $1,500,000 revenue by $1,000,000 type for the Golf Division. $500,000

$0 FY 2014-15 FY 2015-16 FY 2016-17 ($500,000) Classic 18 GF East 9 GF Carts

Other Range Academy

Miniature Golf Anetsberger Merchandise

Expenses Expenses for all the golf operations have averaged $2,464,490 over the past four years. Last year was a bit below this average at $2,443,922, a decrease of 0.25% from the previous year. Note: Divisional expenses are expenses that cannot easily be assigned to a revenue source. This includes overall administrative including the GM’s salary, and facility management. It also should be noted that SCC accounts for 50% of the total operation’s expenses, followed by Divisional at 29.7%. Sportsman’s Golf The table below shows SCC’s expenses broken down by four principal areas, Golf Operations, Course Maintenance, Fleet Management, and General and

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Administrative. It should be noted that we have reorganized data we received from NPD to make it more consistent with what is found in the golf industry and to make it clearer with relation to the overall operation. It is also important to note that these expenses do not include divisional expenses, such as the General Manager’s compensation, advertising, etc., that were for all the facilities. These are included as Divisional Expenses in another section. 4 Year Expense History FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average Sportsman's $1,372,534 $1,373,937 $1,373,899 $1,383,311 $1,375,920 Golf Range $139,767 $139,261 $135,160 $55,365 $117,388 Academy $17,913 $23,674 $28,354 $126,134 $49,019 Anetsberger $104,387 $122,942 $107,042 $86,607 $105,244 Divisional $833,803 $813,536 $799,152 $786,389 $808,220 Other $11,124 $11,012 $6,542 $6,117 $8,699 Total $2,479,527 $2,484,362 $2,450,149 $2,443,922 $2,464,490 Total Payroll The total payroll for the operation, including benefits, averaged $888,422 over the four-year period. Last year, payroll costs rose 3.9% alone, to $920,370. Payroll expenses averaged 64.6% of the total expenses. This would be considered high in relation to all courses, but is within normal for a Premium facility where customer service is highly valued. Golf Operations Golf Operations has averaged $456,380 over the past four years. Last year’s figures were right at that average. Payroll costs are by far the biggest expense area for Golf Operations. It makes up an average of 76% of the costs. This is expected. Total payroll costs have risen by $12,500 since FY13-14, over 3.7%, although they went down last year by 1.7%. Wages over the four-year period has gone down. But the benefits costs have jumped sharply. In FY13-14, employee benefits accounted for $18,742, which was 5.9% of wages. This has increased each year, reaching $39,853 or 12.8% of wages last year. This represents an increase of 112.6% over the four years. The total for payroll is higher than expectation, especially when the fact that the GM’s salary is not included in these figures. It does reflect the value on customer service being placed on the facility. But it also may represent some operational inefficiencies, some of which are due to physical deficiencies such as the remoteness of the range and cart barn and the fact the manager’s offices are in the basement, making supervision more challenging. It is important to note, however,

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Golf Operations Assessment Performance Review that in terms of customers, SCC is handling twice the volume of an 18-hole facility as the East 9 course generates as many customers as the Classic 18. Another big cost in golf operations is the GPS system, which has averaged $51,248/year. The GPS provides a competitive advantage over the courses that do not have it as customers like having the system. It also has a significant impact on improving pace of play. Course Maintenance Total maintenance costs over the past four years has averaged $740,915. Again, payroll is the biggest expense, accounting for 64.3% of the total costs over the past four years. Both the percentage and total payroll amount (including benefits) has increased each of the past three years, from $455,235 in FY15 to $496,507. However, last year’s 65.6% of expenses was lower than FY14’s 66.7%. Raw wages accounted for an average of 58.3% of the total expenses. This is in-line with courses in the area, which generally have higher wages than in other parts of the country. Ground supplies, which are basically chemicals and fertilizers, are the next biggest expense item. These costs have averaged $156,968 over the past four years. This is in line with expectation for a 27-hole course. Actually, it is 36 holes when you include AGC. The last three years have been stable at around $161k, but this is up from $142k in FY13-14. Notably, the cost for fertilizer has gone up significantly over this time. Overall, the maintenance budget appears well within expected limits. Indeed, these figures are low when compared to comparable Premium facilities. Note: the average for public golf courses in the US is $650,000. But this figure includes fleet maintenance. When these two are added together, SCC averages $910,696, which is less than 1.5 times the national average, which is based on 18-holes. Thus, SCC is trying to operate a Premium facility on a budget that is consistent with an average course, not a premium one. When we look at comparing to other 27-hole facilities, we find that SCC is spending less than Arrowhead ($996k), but more than Village Links ($776k). One item is puzzling. During one of our site visits, Jeff and I were surprised to watch a landscaping company pull up and begin maintaining the greenspace area in and around the parking lot. I do not believe I have ever seen a course that has its own maintenance department that would contract out part of that service to another company. I have seen the opposite, where the course will contract out its maintenance department. Apparently, the decision was made to do this when a part-time position within the department was eliminated. The service is costing $4,080 per year. I am not sure that the facility is really saving any money here, given that the extra person would also help in providing better maintenance services to the rest of the facility. And, to me, it is embarrassing to the facility. We recommend the hiring of a part-time crew member and terminating this service. It is hard for me to imagine that an

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Golf Operations Assessment Performance Review outside company, which not only has the labor costs, but also a profit margin to maintain, can do it more efficiently than it can be done in-house. Fleet Management SCC is unique in that it carves out maintenance of the equipment from the course maintenance department. Instead, it is managed by Fleet Services, with the mechanic reporting to a non-golf manager within NPD. Fleet management services have averaged $169,780 over the past four years. This has dropped significantly from a high of $193,910 in FY13-14. Payroll, though, has increased from $68,165 to $72,770 or 5.2%. Over the four-year period, payroll, including benefits, accounts for an average of 38.3% of the total expenses. Last year’s 45.3% was significantly greater than the next highest (FY14-15 at 38.4%). This is largely due to the dramatic reduction in the cost of fuel. Fuel costs averaged $45,126 over the four-years. But this cost has dropped sharply over the four-years, going from $58,277 in FY13-14 to just $31,364 last year. This represents a drop of $28,084 or 24.9%. General and Administrative Most of SCC’s G&A costs are absorbed by the Division. The ones that can be attributed to just the golf courses averages only $8,845 over the four-year period. Driving Range The range at SCC is unusual in that it’s at the same location as the golf courses, but it is remote from the clubhouse. This means: 1. Expenses are higher because it requires separate clubhouse and personnel to oversee 2. It gets a lot less income from “warm-up” buckets from golfers wanting to warm up before a round. As such, the range more resembles a stand-alone range than a golf course range. It is also unusual in that it has a miniature golf course that is part of its operation. Over the past four years, the operating expenses for the range have averaged $117,388. However, the first three years of the period, it averaged closer to $138,000, before falling 59% last year to $55,365. The reduction was largely due to a restructuring of management whereby the range supervisor was transferred to the Academy’s payroll. This effectively reduced total payroll by $85k. The only other major expense is in supplies, which averages about $29,957 a year. Academy The Academy operates with a very low overhead. It was minimal until last year, when the range and Academy were reorganized with the range’s supervisor transferred to Academy’s payroll. This resulted in the addition of about $53k in costs.

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The biggest outlay for the Academy is in paying the pros their share of the revenue. We have considered this to be a cost of sales item rather than an expense. We will talk more about the percentage split in the Operations section. Anetsberger AGC’s expenses are broken down into two categories, Golf Operations and Course Maintenance. Total expenses have averaged $116,568 over the past four years. Last year’s $97,746 represents a 4-year low and is 17.3% lower than the previous year and nearly 40k lower than in FY15 ($135,750). Golf Operations Golf operations expenses averaged $59,878 over the past four years. Last year, at $48,078, was the low. The high was $72,731 in FY14-15. By far, payroll is the biggest part of this expense averaging $40,714/year. Again, last year saw a substantial reduction, going from $46,701 in FY15-16 to $32,935 last year, a drop of 29.5%. All the personnel at the facility are part-time. Course Maintenance Course maintenance expenses also declined last year (5.6% or $2,953), going from $52,621 to $49,668. Over the four years, it averaged $56,690. Raw payroll made up only an average of 42.7% of the maintenance expenses, which is very low. This is because there is no supervisor at Anetsberger on site and the one maintenance worker there is seasonal. Payroll costs have held steady over the period, averaging $24,205. The biggest reduction has come in operating supplies (fertilizers and chemicals), which were just $19,012 last year, compared to the four-year average of $26,805. This expense does correlate well with the course’s appearance and condition. The fact that it was reduced last year may have resulted in a less pleasing product, helping explain why the rounds decreased by 6.5%. Divisional Divisional expenses include facility management and general and administrative services for the Golf Division. These expenses have combined to average $808,220 over the past four years. However, there has been a four-year trend of lowered expenses. FY13-14’s expenses totaled $833,803. Last year, they were $786,389 a decline of $47,414 or 5.7%. Facility Management This is another area where the expenses are all within the Golf Division, but the employee does not report to the Golf Division, but to facility services within the NPD. Facility Management was largely responsible for the decline in overall expenses as it has dropped from $244,936 in FY13-14 to $214,617 last year, a drop of $30,319 or 12.4%. Payroll accounts for about 30% (29.5%) of the total. However, the payroll expense has held steady over the period, averaging $68,195 including benefits.

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Supplies have averaged $25,146. Last year’s was close to average at $24,020. This was a little higher (5.2%) than the previous year. Repair and Maintenance has seen a steady drop in expenses, from $21,318 in FY13-14 to just $8,428. This is a reduction of 60.5%, including a 36.4% drop from FY15-16 to last year. Contractual services, which include utilities, has also dropped steadily. In FY13-14, these expenses totaled $132,722, with $93,750 in utilities (water, gas and electric). In FY16-17, these had dropped to $113,929 total and $82,628 for utilities. This represents a decline of 14.2% for the total and 11.9% in the utility costs over the 4-year period. General and Administrative G&A expenses have also declined since FY13-14, but it has not been steady. They dropped from FY14 to FY15, before going up in FY15-16 and then dropping again last year. Over the four-year period, the G&A expenses have averaged $577,080. Last year’s $571,772 was 1.1% lower than the previous year and 2.9% or $17,095 lower than in FY13-14. Payroll (wages plus health insurance), averaged $127,769 over the four years. However, these costs have increased 12.1% since FY13-14, going from $119,233 to $133,603 last year. The next biggest expense was unemployment insurance, which averaged $83,661. This cost has dropped substantially from $92,639 in FY13-14 to $79,325 last year, a drop of $13,314 or 14.4%. Overall, contractual services, which includes unemployment, has dropped from $169,635 in FY13-14 to $138,169 last year. Notably another contractual expense has declined over this time frame and that is advertising. In FY13-14, $13,977 was spent in advertising. This has dropped 83.5% to just $2,300 last year. We feel this drop-in advertising is one of the main reasons behind the decline in rounds over this period. In our experience, no other expense correlates more highly than advertising with performance. The Golf Division’s expenses in this area are substantially behind industry standards. The rule of thumb for golf is to spend 3% of the gross revenue in advertising expense. Last year, that would have meant an expenditure of $81,642. We will talk more about this in the Operations section. Perhaps the most controversial part of G&A budget is the Administrative Charges section. This has been a constant $300,000 over the four years. Most of these charges are payroll related, such as FICA, Medicare, IMRF (retirement fund), and Life Insurance. These payroll expenses have averaged $206,118 over the past four years. However, they have been on a downward trend. Last year was the lowest at $192,893, which is an 11.4% drop from FY13-14 and a 7.3% decline from the previous year. The other aspects include PDRMA (risk management), Golf Conference, Software and an “Administrative Overhead Charge.” The latter is basically a rounding mechanism to keep the payment at $300,000. No other department within NPD has such a charge. This fee averaged $31,041 over the four years.

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Net Operating Income Net Operating Income (NOI) is basically the bottom line. It represents the operating profit or loss of an operation. It is determined by taking the Gross Revenues and then subtracting the cost of sales and operating expenses. NOI does not include such costs such as capital expenses, depreciation, or debt service. Net Operating Income FY 2013-14 FY 2014-15 FY 2015-16 FY 2016-17 Average

Sportsman's Golf Revenue $1,988,936 $2,004,396 $2,057,978 $1,966,047 $2,004,339 Cost of Sales $162,713 $184,267 $192,648 $176,773 $179,100 Expenses $1,372,534 $1,373,937 $1,373,899 $1,383,311 $1,375,920 Net Operating Income $453,689 $446,192 $491,431 $405,963 $449,319 Driving Range Revenue $267,889 $285,026 $281,421 $251,139 $271,369

Cost of Sales $29 $148 $0 $0 $44 Expenses $139,767 $139,261 $135,160 $55,365 $117,388 Net Operating Income $128,093 $145,618 $146,262 $195,774 $153,936 Academy Revenue $260,661 $279,213 $298,339 $364,832 $300,761 Cost of Sales $184,548 $192,727 $203,145 $156,349 $184,192 Expenses $17,913 $23,674 $28,354 $126,134 $49,019 Net Operating Income $58,200 $62,813 $66,840 $82,350 $67,551 Anetsberger Revenue $128,068 $129,704 $122,254 $125,937 $126,491 Cost of Sales $10,175 $12,808 $11,172 $11,139 $11,324 Expenses $104,387 $122,942 $107,042 $86,607 $105,244 Net Operating Income $13,506 ($6,046) $4,040 $28,191 $9,923 Divisional and Other Revenue $23,815 $22,891 $3,024 $13,431 $15,790 Cost of Sales $0 $0 $0 $0 $0 Expenses $844,927 $824,549 $805,694 $792,506 $816,919 Net Operating Income ($821,112) ($801,658) ($802,670) ($779,075) ($801,129) TOTAL FOR DIVISION Revenue $2,669,369 $2,721,230 $2,763,017 $2,721,385 $2,718,750 Cost of Sales $357,465 $389,949 $406,965 $344,261 $374,660 Expenses $2,490,651 $2,495,374 $2,456,691 $2,450,039 $2,473,189 Net Operating Income ($178,747) ($164,094) ($100,640) ($72,915) ($129,099)

Overall, the Golf Division has averaged an operating loss of $72,409. This has been improving in each of the past four years, going from a loss of $178,747 in FY13-14 to a loss of $72,915 last year. This is an improvement of $105,832 or 59.2%.

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To get a better idea of how each department is doing, we allocated the divisional expenses to each department based on its share of the total revenue. The results are below. Net Adjusted Operating Income FY 2013- FY 2014- FY 2015- FY 2016- Average 14 15 16 17 Sportsman's Golf Revenue $1,988,936 $2,004,396 $2,057,978 $1,966,047 $2,004,339 Cost of Sales $162,713 $184,267 $192,648 $176,773 $179,100 Expenses $1,987,237 $1,973,699 $1,963,057 $1,963,059 $1,971,763 Net Operating Income ($161,014) ($153,570) ($97,727) ($173,785) ($146,524) Driving Range Revenue $267,889 $285,026 $281,421 $251,139 $271,369

Cost of Sales $29 $148 $0 $0 $44 Expenses $222,992 $139,261 $135,160 $55,365 $138,194 Net Operating Income $44,868 $145,618 $146,262 $195,774 $133,130 Academy Revenue $260,661 $279,213 $298,339 $364,832 $300,761 Cost of Sales $184,548 $192,727 $203,145 $156,349 $184,192 Expenses $110,152 $23,674 $28,354 $126,134 $72,078 Net Operating Income ($34,039) $62,813 $66,840 $82,350 $44,491 Anetsberger Revenue $128,068 $129,704 $122,254 $125,937 $126,491 Cost of Sales $10,175 $12,808 $11,172 $11,139 $11,324 Expenses $143,180 $122,942 $107,042 $86,607 $114,943 Net Operating Income ($25,287) ($6,046) $4,040 $28,191 $224 Divisional and Other Revenue $23,815 $22,891 $3,024 $13,431 $15,790 Cost of Sales $0 $0 $0 $0 $0 Expenses $11,124 $11,012 $6,542 $6,117 $8,699 Net Operating Income $12,691 $11,879 ($3,518) $7,314 $7,091 TOTAL FOR DIVISION

Revenue $2,669,369 $2,721,230 $2,763,017 $2,721,385 $2,718,750 Cost of Sales $357,465 $389,949 $406,965 $344,261 $374,660 Expenses $2,490,651 $2,495,374 $2,456,691 $2,450,039 $2,473,189 Net Operating Income ($178,747) ($164,094) ($100,640) ($72,915) ($129,099)

Using this allocation formula, we see that the driving range is the most profitable operation, with an average NOI of $133,130, followed by the Academy at $44,491.

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Last year saw a precipitous increase in both, as the range generated an NOI of $195,774 and the Academy, $82,350. Anetsberger was basically at break-even, with an NOI average of $224. However, it has been profitable each of the last two years, with an NOI last year of $28,191. On the other hand, the two courses at SCC have been losing money. Over the four years, it has averaged a loss of $146,524. Last year’s loss was the greatest at $173,785. “True” NOI According to the figures above, which are the ones circulated by the NPD, the Golf Division had a loss of $72,915. However, a closer examination makes this a bit misleading due to how the accounting is being done at NPD. We wanted to look at it as though the Golf Division was a separate operation, such as would be the case if it operated as an Enterprise Fund or if it were owned by a private operator. Setting aside the fact that two departments, fleet services and facility management, are under the golf budget but are managed outside the division, we found two adjustments that should be made if you wanted to see a true picture of the Golf Division’s performance. The first is the administrative overhead charge – the difference between the $300,000 admin charge and the actual expenses incurred that is covered by this fee. Last year, the overhead fee was $47,182. The other adjustment comes from the employee’s contribution to health insurance. This can range from 0% to 20%. This money does NOT go back to the Division’s budget, but rather is included in the HR Department at NPD. We have estimated this contribution to be $27,456 last year. When these adjustments are made, we discover that the Golf Division essentially broke even last year.

Adjusted Net Operating Income FY 2013- FY 2014- FY 2015- FY 2016- Average 14 15 16 17 Stated NOI ($178,747) ($164,094) ($100,640) ($72,915) ($129,099 ) Adjustments Admin Overhead fee $24,151 $21,402 $31,428 $47,182 $31,041 Est Empl Contribution $14,000 $14,000 $14,000 $13,995 $13,999 Adjusted NOI ($140,596) ($128,692) ($55,211) ($11,738) ($84,059)

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Discussion In addition to the above analyses, we looked at various details of the operation, including a thorough look at the items sales reports. The picture that emerges is that the Golf Division is being well managed from a cost control basis. Indeed, our main concerns are the areas where we do not feel enough is being spent. These are the two areas that are most correlated with revenue – course maintenance and especially marketing. The Golf Division needs to be spending a lot more in marketing to attract more outside play. This play not only adds more rounds, but it is the highest yielding rounds. We will discuss this more in the Operations section. That is not to say that no improvements are needed elsewhere. We do think that greater efficiencies can be accomplished in some areas, which we will discuss in Operations. But the biggest area where improvements can be made are in generating revenue, both in terms of volume and yield. We will also be discussing this more in the Operations section. On the positive side, there were several things that jumped out to us. These include: • The success of the range. It is generating significantly more than most golf course ranges. • The success of the Academy. This has become a tremendous profit center. • The performance of Anetsberger. We were expecting that Anetsberger would show as a big money loser. But instead, it is showing a positive NOI, even with divisional expenses are allocated. This is due to managing the expenses extremely tightly.

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We received customer feedback in three ways – personal interviews, stakeholder meetings and a customer survey. The customer survey provides the most information and will be the main topic in this section. However, the feedback among the three groups was consistent. The customer survey utilized was one developed and administered by the National Golf Foundation. One of the primary benefits of using this survey is that it has two parts – a standardized section and a custom section. The questions in the standardized section are used in all their surveys, which allows us to compare our results with results from over 1,000 other courses nationwide. The custom questions allow us to ask specific questions targeted to each of the facilities. We had three surveys – one for each of the golf courses: Classic 18, East 9 and AGC. Customers could do one, two or all three surveys. The surveys were web- based. NPD emailed the links to the surveys using the golf course’s database. The comparison to the national database is essential in understanding the results. This is due to a natural bias among survey takers as well as it allows us to better judge relative performance. For example, an average answer of 7.5 on a scale from 1 to 10 where 1 is the worst and 10 is the best, may seem like a decent score – until we compare it to the national database and discover that it rates in the bottom 5% of all courses surveyed. We received 313 responses for the Classic 18, 108 for the East 9 and just 35 for Anetsberger. The small sample size for Anetsberger prevents us from making any solid conclusions as it is not a significant sample size. However, it still provides some useful insight. It is important to note that these responses are coming from your customers. The assumption being that the areas that they are most dissatisfied with are likely the reasons that golfers are choosing not to play your courses. Overall Customer Satisfaction These are the main factors that go into judging customer satisfaction with your course. These are part of the standard NGF questions, which allows us to compare NPD responses with the national database, providing valuable insight. Overall Impression As we will show, the responses from the survey were a lot worse that we had pictured. Frankly, this caught us off-guard as they did not match our own impressions or expectations at all. What surprised us was not what they were particularly dissatisfied with, but to the degree they were dissatisfied. In fact, as you will see, many of the satisfaction factors play Classic 18 and East 9 in the lowest 10% of ALL courses in the NGF database, which numbers over 1,000. While we can understand the dissatisfaction, we can assure the reader that the reality is

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SCC is not in the bottom 10% in these factors. So why were the ratings so low? We believe the main reason is that the golfers are naturally comparing Classic 18 and East 9 to the other courses they play. Thus, we feel these scores are more reflective of how these facilities match up to the area competition. It still makes the results important and revealing, but they do not necessarily paint as black a picture as the statistics suggest. In the table below, we show both the raw score and the percentile score for each factor by facility. The percentile score represents what percentage of facilities scored worse than the target facility. Thus, the lower the percentile, the worse the score. Two percentile scores are given. One is for the course’s rate band peer group, which is Premium for Classic 18 and East 9, but value for AGC. The other is for all courses tested.

Customer Satisfaction Measures Classic 18 East 9 Anets Total Responses 313 108 35 Overall Customer Satisfaction Average Score 7.6 8.3 8 Rate Band Percentile 16 40 58 National Percentile 33 62 41 Satisfaction Compared to Expectations Average Score 7.3 7.7 8.2 Rate Band Percentile 14 35 76 National Percentile 21 45 81 Satisfaction Compared to Competition Average Score 7.3 8 7.9 Rate Band Percentile 13 47 68 National Percentile 26 61 60 Likelihood to play more Average Score 6 6.4 6.1 Rate Band Percentile 25 54 9 National Percentile 13 44 18 Likelihood to recommend Average Score 7.4 8.1 8 Rate Band Percentile 7 38 59 National Percentile 17 54 47

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Classic 18 The table below represents the results for the Classic 18. In every measure, Classic 18 scored well below the national average, both for premium courses and ALL courses. In most areas, the score was below the 25th percentile. The most important scale is for Overall Customer Satisfaction. On this measure, Classic 18 scored at the 18th percentile for Premium courses and the 33rd for all courses. The ratings for Satisfaction Compared to Expectations and for Satisfaction Compared to Other Courses were even worse. At the bottom, though, was “Likelihood to Recommend”, where Classic 18 was in the 7th percentile for Premium courses and the 17th for all courses.

Because the sample size was large, we could look at factors such as age, sex, and usage of the course with Classic 18 that we could not do with validity with the other two courses. This led to some interesting observations, including: • Females had a better overall impression than the men (50th percentile vs. 11th). This may be because the women play fewer other courses. This split held for all the five indexes. • Seniors (60+) gave higher ratings than the other groups. Their overall satisfaction score was 8.2 (32nd percentile), compared to the overall average of 7.6 (16th percentile). However, the difference was not as strong on the other factors.

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• Perhaps surprisingly, there was not a significant difference in ratings between the high users and low users. High users were defined as those that identified themselves as league players, preferred player program members, discount card holders or permanent teetime customers. NGF uses the responses from these measures to form a “Loyalty Index”. They divide responders into three groups based on overall satisfaction. Those who rated the course as a “9” or “10” are considered “Promoters”, those who rate it a “7” or “8” are “Passive”, while those rating it at “6” or below are considered “Detractors”. The Loyalty Index is then calculated by taking the percentage of promoters and subtracting the percentage of detractors. In the case of Classic 18, the Loyalty Index is an abysmal 8.9%. The Premium benchmark is an index value of 44.5%, and the all course value is 24.1%. The percentage of Passives for the Classic 18 is in line with the other groups. But it has a much smaller percentage of promoters and a much larger percentage of detractors. East 9 The East 9 fared better on all measures than its big brother, although the ratings were still not good, but were closer to average. The overall satisfaction index ranked at the 40th percentile for Premium courses, but at the 62nd percentile for all courses. Again, these numbers are counter-intuitive to us as the Classic 18, in our professional opinions, is a superior course and the two share the same facilities and staffing. So why was East 9 rated better? The reason is that the customers who play East 9 play a much distinct set of courses than Classic 18 customers. And, as we shall see, the customer base for the two courses is very different. The Loyalty Index for the East 9 is also much better, at 34.2% than for Classic 18 (8.9%). This places it behind the Premium benchmark of 44.5%, but ahead of the

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Golf Operations Assessment Customer Survey national mark of 24.1%. Over 50% of the respondents were considered promoters, while just 16.7% were detractors. Anetsberger While the results from Anetsberger are not statistically significant, they are informative. Overall, AGC’s numbers were about average, especially when compared to their peer group – other value courses. Overall, the average overall satisfaction score of 8.0 was good enough to place it in the 58th percentile for value courses (41st overall). AGC scored much better than average on Satisfaction Compared to Expectations (76th percentile of value courses), and Satisfaction Compared to Other Courses (68th). However, AGC performed poorly on the index for Likelihood to Play More, where it ranked near the bottom at the 9th percentile for value courses. The Loyalty Index for AGC was 25.7%, with twice as many promoters (51.4%) as detractors (25.7%). This places AGC above average for both the Value and National scales. This does present a bit of a paradox. Customers are generally loyal to AGC, but they are not willing to play more rounds than they are currently doing. Satisfaction Factors The Satisfaction Factors measure the customer’s satisfaction with various more specific aspects of the course. As with the overall satisfaction measure, the scores are low, especially for Classic 18. The table, which can be found in Appendix F, shows the scores for all three scores on all the measures. Classic 18 The Classic 18 scored below the peer group on all but two measures, and below the national average on all but one. There are 22 total factors. Classic 18 scored best on Location, where it was in the 95th percentile for its peer group, and 92nd overall. This fact, combined with the paltry scores on other indexes, strongly suggests that the only loyalty SCC is generating is due to its convenience and not because of the quality of the course or services. This is both good and bad. It’s obviously bad because SCC is perceived to be inferior to its competition on almost all factors. But the good news is that SCC can do well enough to break-even mainly on the strength of its location. If we can improve Classic 18’s ratings in the other areas, it should enable it to greatly increase its market share. Some other important findings: • Sex: There were 48 female respondents, or about 15%

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• Usage: Respondents were pretty equally represented. There were 155 high users and 158 low users. • Age: There were only 8 respondents under 30 (2.6%), 74 between 30 and 49 (23.6%), 76 in their 50s (24.3%). But nearly half the respondents (49.5%) were over 60. Clearly the course is having difficulty attracting younger players, which is a great concern as who is going to replace the seniors when they age out? • Course Conditions: Classic 18 was rated in the 12th percentile in its peer group and 34th overall with regards to its course conditions. As our report will show, this is not reflective of its current conditions, but it does reflect its condition relative to its primary competition. And this is key. When we looked at the written comments, which we will discuss later, there were actually more positive comments about course maintenance than bad. Overall, it seems to be the universal opinion that the course conditions have dramatically improved over the past five years. This was also confirmed in our personal interviews and stakeholder meetings. However, this does NOT mean it is the equal of its peers. When we asked a group of league players (about 25), they unanimously voted that Classic 18’s conditions had greatly improved. But when I asked “are Classic 18’s conditions as good as or better than the other courses you play” only one of the 25 voted “yes.” This should not be taken as a criticism of the Superintendent or his crew, but as we will discuss in the Agronomist and Architects report, more due to deteriorating infrastructure such as old greens, poor drainage on the course, bunkers in bad need of renovation, etc. • Friendliness/Helpfulness of the Staff: This one also caught us by surprise. Classic 18 ranked in the 22nd percentile in its peer group and 31st overall. Yet East 9, which has the same staff, fared better (although still poorly) at the 32nd peer percentile and 46th national. Again, we will see this rating somewhat contradicted in the comments section, where staff are greatly praised. So, it does not seem like the customer service is “bad”, but rather it may not yet be on a par with the primary competition. We delved into this a little further by looking at the people who use the course the most (league, preferred player program, discount card holders) versus those that use it occasionally. We found a dramatic difference. The heavy users gave Classic 18 a score of 8.6, ranking it in the 40th percentile, while the light users rated it at 8.0, which puts it at the 10th percentile. This difference may indicate that staff consciously, or not, may be treating “regulars” preferentially. While this may create loyalty among the chosen, it greatly hurts the ability to attract new customers. • Pace of Play ranked 16th percentile among peers. Women rated the pace (60th percentile) much higher than men (12th percentile). Seniors (over 60), also gave a better (but not good) rating of 31st percentile. • Course Design/Layout was given very low scores, rating in the 5th percentile among peers. Again, this did not match our own perception, but

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does strongly suggest some improvement is required. Younger golfers (under 50) gave the rating as less the 1st percentile. One of the factors that is likely contributing to this low score is the length. • Teetime availability: Overall, this was rated at the 40th percentile. However, women gave it high marks (92nd percentile), while men gave it low (30th). This may reflect the fact that most women tend to play during non- peak times. The same reasoning applies to the fact that this rating was highly correlated with age. Golfers under 50 rated it below the 20th percentile while seniors rated it at the 68th. • On Course Services (which include restrooms and water). We were surprised here to not find a gender difference in ratings. Everyone seems dissatisfied, with a score at the 18th percentile. • Overall Experience: The average score was an anemic 8th percentile. Women (34%) were happier than men (6th). High users rated it much higher (7.9) than low users (6.9). Ratings were also highly correlated with age, with seniors more satisfied (8.0, 18th percentile). • Bunkers: To the surprise of no one, bunkers rated very low, at 7th percentile. But they didn’t like the greens (7th percentile), tees (5th percentile) or fairways (14th percentile) either. In all cases, seniors were more generous than the younger players, although still rating them poorly. • Condition of the Golf Carts was universally panned and rated at the 1st percentile – bottom of the heap. • Food and Beverage Service: Also rated at the 1st percentile. Horrible for a Premium facility, but it was still in just the 2nd percentile of ALL courses. • Affordability: This is the only other factor receiving good scores. Classic 18 rated in the 77th percentile for Premium courses (41st overall). This strongly suggests that cost has not been a big inhibitor. Again, course comments back this. • Overall Quality of the Proshop: Given the relatively satisfactory performance in merchandise sales it is somewhat surprising that in all three factors measuring merchandise sales (Overall Quality of Proshop; Overall Quality of Apparel, and Overall Quality of Merchandise), Classic 18 received poor ratings. It did best in merchandise (26th percentile) and worst in Apparel (14th). East 9 In general, East 9 scored better on the factors than the Classic 18, but still came up short when compared to the Premium and national databases. Of note are: • Overall Value: Rated 45th in the Premium percentile and 34th in the national, and this was one of the better scoring factors. • Course Conditions: Rated in the 31st in the Premium percentile, 55th nationally. This is one of the main drivers for repeat play. These are much

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better than for Classic 18, although the same team works on both. It reflects both that the customer base is different for the two courses, with the East 9 base perhaps not as discriminating. It may also reflect the fact that the infrastructure, particularly the greens, are all newer on East 9. • Course Design/Layout: Received particularly low scores, in the 7th percentile for Premium and 20th for national. • Location was again the highest rated attribute, putting it in the 88th percentile for Premium and 84th for national. Again, this strongly suggests that the current customer base is playing the course based on its location rather than quality. • Tee Time Availability received good marks, at the 70th percentile. But this is not necessarily a good thing. You want the course to be so busy that getting a teetime is difficult. • Amenities, which includes the clubhouse, received a very low score – putting East 9 in the 2nd percentile for Premiums and just the 8th for national. • Food and Beverage Service was the worst rated factor, rating in the bottom 1%. • Overall Experience was just in the 18th percentile for Premium, 34th national. This, obviously, is not good. • Course factors each received low ratings. However, the bunkers got the lowest grade (8th percentile), followed by tees (11th). Greens and fairways were still both in the bottom quartile. • Merchandise as was the case with Classic 18, the three factors with regards to merchandise sales were all in the lower quartile for Premium facilities and the lower half for all. Anetsberger In general, Anetsberger fared better than the Classic 18 and East 9, but still the ratings were poor. In its case, the peer group was value facilities, rather than premium. Some observations: • Staff: Ratings for staff were favorable, in the top quartile. • Amenities: Was rated in the bottom 20% of courses. • Scenery and Aesthetics: Rated well, in the top 30% in its peer group. • Food and Beverage: Rated below the bottom 1% in both measures. • Overall Experience: Rated above average, at the 62nd percentile. • Affordability: Also rated well, in the top 30% of its peers and top 6% overall. • Practice Facility: rated well (top quartile for peers) even though it is just a short game area.

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• Merchandise: Rated poorly in all measures. • Course conditions: Greens was the lowest rated, in the bottom 25%, (22), as were tees (23rd percentile). Fairways were close to average (42nd percentile), while bunkers (few though they are) rated well – in the top 20% of value courses. Loyalty Driver NGF takes the ratings from the Satisfaction Factors above and weights them based on their influence in determining where golfers play. This information comes from more sophisticated analyses that has been conducted over several years of doing this survey. The result is what they refer to as the “Loyalty Driver”. The higher the loyalty driver, the greater the influence this factor has on return play. We then can take the ratings from our survey results and plot them on a chart based on the rating and the loyalty driver index for that rating. NGF divides the plot into four quadrants. The upper left quadrant is designated “maintain”. These are factors that have little influence, but that you scored well on. The lower left quadrant is “Monitor” factors, those where the ratings were poor, but are not as important. The upper right is the most desirable ratings. These are “strengths”, the reasons likely most players are playing your course. On the other hand, the lower left factors are “Must Improve,” which are factors that are both major influencers and that you scored poorly on. The closer a given factor is to the extreme lower right- hand side, the more this factor is likely hurting your performance. Classic 18 When we look at the plot for Classic 18, we see a recipe for disaster. Only one factor, affordability, could possibly be considered a “Strength” and it is of borderline importance. On the other hand, 13 factors fell into the “Must Improve” category. The most detrimental factor was “overall experience.” It was followed by “overall course conditions.”

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East 9 For the East 9, the story is pretty much the same. However, in its case, course design was the most detrimental factor and its one borderline strength was “teetime availability.”

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Anetsberger Anetsberger scored the best. It had four “strengths,” led by “condition of bunkers.” And it had eight “must improve” factors, with course conditions, conditions of the greens and conditions of the fairways being the most detrimental. While it did the best of the three, we still had twice as many factors in the “must improve” quadrant than in the “strength”.

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Customer Referrals It was asked whether you came to the course based on a referral, as well as whether you were willing to make a referral, either positive or negative. Customer Referrals Classic East 18 9 Anets # Respondents 313 108 35

New customers referred by others 36% 60% 67% Customer that made positive referral 70% 70% 89% Average number made 3.7 3.7 3.6 Customers that made negative referral 8% 2% 3% Average number made 4.0 6.0 1.0

In general, the news was good as there were a lot more people making positive referrals than negative one for each course. One interesting note, 100% of the females playing Classic 18 indicated that they were referred to the course. Competition Respondents were asked what other courses they play. Below shows the top courses listed for each facility. Note that Anetsberger was the top competitor for the East 9, but received no votes from the Classic 18 players. Nor did either of the two SCC courses show up on the Anetsberger ratings. Top 10 Competitors Classic 18 East 9 Anetsberger % % % Course play Course play Course play Deerfield 22% Anetsberger 14% Glenview Prairie 14% Glencoe 20% Willowhill 13% Willowhill 14% Glenview Park 11% Deerfield 8% Stonewall Orchard 9% ThunderHawk 11% Glencoe 7% Deerfield 6% Traditions at Chevy Chase 10% Glenview Prairie 7% Mission Hills CC 6% The Glen Club 10% Glenview Park 6% Weber Park 6% Steeple Chase 9% Wilmette 6% Glencoe 6% Stonewall Orchard 9% Glen View 6% ThunderHawk 6% Highland Park CC 9% Countryside 6% Glen View 6% The Arboretum 9% Heather Ridge 5%

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What is interesting is that there were two courses that received play from 20% or more of the respondents for the Classic 18, but the results were more spread out for the other facilities. There also was not as much crossover, indicating the three courses are indeed in different markets. Indeed, only two of the closest courses, Glencoe and Deerfield, show up on all three lists. Zip Codes Below is a table listing the zip codes or towns by percent of respondents. Only those with multiple respondents are listed. As can be seen, there is a limited area being drawn from for all the facilities, with Northbrook dominating each facility. Top Zip Codes Classic 18 East 9 Anetsberger % % % Community from Community from Community from Northbrook 62.0% Northbrook 61.1% Northbrook 74.3% Glenview 3.8% Glenview 2.8% Deerfield 3% Deerfield 3.2% Deerfield 2.8% Highland Park 2.9% Highland Park 2.8% Glenview 2.6% Glenview 2.8% Arlington Heights 2.2% Evanston 1.3%

Customer Profile Here we look at various demographics and how each grouping rated the course. For the Classic 18 Course, we further broke it down by age. Three factors were examined: the average overall satisfaction score given, the average annual spending on golf, and the average wallet share that the target facility is receiving (that is, the percentage of all rounds that the customer plays that are being played on the target facility). Customer Profile Overall Classic 18 East 9 Anets Course Rounds Total Total Responses 313 108 35 Satisfaction 7.9 8.3 8.0 Avg. Annual Spend $1,072 $461 $253 Avg. Wallet Share 52.8% 63.0% 59.4%

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For the Classic 18, it is capturing 52.8% of the rounds its customers are playing. East 9 is capturing 63% and AGC, 59.4%. We do note that wallet share seems to improve with age for the Classic 18. While we will include Anetsberger in the summary ratings, it should be noted that there are simply too few responses to form any valid conclusions when we try to break the respondents into smaller groups. Course Rounds Respondents were grouped into four categories based on the number of annual rounds they play at that facility. The groupings were 1-7, 8-24, 25-49 and 50+. The results are shown below. Rounds Played at Course Classic 18 East 9 Anets Course Rounds Total 1-7 Responses 112 39 15 % of response 35.8% 36.1% 42.9% Satisfaction 7.6 7.9 8.2 Avg. Annual Spend $321 $188 $85 Avg. Wallet Share 25.6% 38.2% 49.7% 8-24 Responses 128 57 16 % of response 40.9% 52.8% 45.7% Satisfaction 7.9 8.4 8.2 Avg. Annual Spend $967 $502 $326 Avg. Wallet Share 63.6% 74.3% 62.2% 25-49 Responses 61 10 3 % of response 19.5% 9.3% 8.6% Satisfaction 8.2 9.3 6.0 Avg. Annual Spend $2,057 $1,081 $725 Avg. Wallet Share 74.7% 91.5% 78.7% 50+ Responses 12 2 1 % of response 3.8% 1.9% 2.9% Satisfaction 9.1 6.0 7.0 Avg. Annual Spend $4,096 $1,550 $210 Avg. Wallet Share 79.4% 82.0% 100.0%

There are few surprises in this data. As one would expect, the customers that had the highest satisfaction with the course also played it the most, and gave it a higher

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Golf Operations Assessment Customer Survey percentage of their overall rounds (wallet share) and spent the most money there. We did note a trend on the Classic 18 where seniors in general gave higher ratings than other groups. For the Classic 18, a lower percentage of women players were in the 1-7 category (22.9% vs. 38.1%) as well as in the higher volume categories (over 25 rounds) where 16.9% of the women and 24.6% of the men indicating they played more than 25 rounds. Gender For the Classic 18 Course, women had higher satisfaction ratings and a higher wallet share than men. Age was also a factor, with the older golfers having higher satisfaction and wallet share. Men and women spent about the same amount at the course. Women also rated the East 9 and Anetsberger higher than their male counterparts, and had greater wallet share. Men out spent women at AGC was the only variant. By Gender East Classic 18 9 Anets Course Rounds Total Male Responses 265 71 23 % of response 84.7% 65.7% 65.7% Satisfaction 7.8 8.1 7.4 Avg. Annual Spend $1,079 $441 $285 Avg. Wallet Share 50.4% 59.4% 57.0% Female Responses 48 37 12 % of response 15.3% 34.3% 34.3% Satisfaction 8.4 8.7 9.1 Avg. Annual Spend $1,036 $501 $193 Avg. Wallet Share 66.0% 69.9% 63.9%

The East 9 had over twice the response rate from females (34.3% vs. 15.3%) as the Classic 18. Age NGF divided the respondents into seven age bands: under 18, 18-29, 30-39, 40-49, 50-59, 60-69 and 70+. The full table is given in Appendix F.

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One of the biggest things to jump out is the paucity of younger golfers for both SCC courses. For the Classic 18, there were no juniors and only eight (3%) respondents under 30. Only 13% were under the age of 40. On the other hand, nearly half (49.5%) were over the age of 60. Having a high percentage of seniors is good for weekday play, but is not healthy overall as they will eventually “age out” with health concerns limiting their play. If you are not doing a good job recruiting younger players, it may be difficult to replace these golfers. Moreover, younger golfers typically spend a lot more money playing. The trend was even more pronounced for the East 9. Only 6% of the respondents were under 40, and 68.5% were over 60. We realize that these differences may well be due to sampling error. Given the length of the survey, younger golfers may simply have been less inclined to complete. However, in our experience with this survey, rarely have we seen such a dramatic difference in responses, leading us to believe that there truly is an issue in attracting younger golfers to the courses. This point becomes clearer as we examine the satisfaction ratings where we see the younger golfers are much more dissatisfied with both the Classic 18 and East 9. Customer Segment Respondents were asked which of the following categories best describes them: • Local player or area resident • Non-resident • Discount Card Holder • Member of the Preferred Player Program • Member of another Club • League Player • Permanent Teetime Holder The table of results is presented in Appendix F. Classic 18 Course People identifying themselves as local, without indicating belonging to another category, were the most numerous, with 31.9% of the responses. In contrast, only 16% identified themselves as non-resident. This is consistent with the zip code identification, were roughly two-thirds were from Northbrook. Only eight respondents identified themselves as members of other clubs. Perhaps surprisingly, they gave the highest satisfaction marks, along with the Preferred Player Program members. Permanent teetime holders were next.

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We did note some gender differences in these categories. Nearly half (46%) of the league players were women, as opposed to 15.3% of all respondents. Yet there were only two (4.5%) of the discount card holders were women. The highest satisfaction ratings were given by those in high-use categories such as league player, preferred player program, and permanent teetime holder. East 9 The results were similar for these courses. For the East 9, the lowest ratings were given by the “Locals”, who made up 42.6% of the respondents. We were surprised to find only 11.1% of the respondents identified themselves as a League Player. Given the volume of league play on East 9, we thought the response would be far higher. Comments On the standardized section, two questions were open-ended, asking for comments. The first was asking what they liked most about the course, and the second asked what needed improvement. We have attempted to enumerate these responses by grouping them according to subject. Like Most We broke down the responses into nine general categories. The results are given below. Comments Like Best Classic 18 East 9 Anets Females Males Total CL # % Resp # % Resp # % Resp # % Resp # % Resp # Responses 48 265 313 108 35 Customer Service 12 25.0% 57 21.5% 69 22.0% 15 13.9% 3 8.6% Course Maintenance 15 31.3% 85 32.1% 100 31.9% 39 36.1% 1 2.9% Operations 3 6.3% 28 10.6% 31 9.9% 18 16.7% 11 31.4% Golf Course 22 45.8% 118 44.5% 140 44.7% 61 56.5% 24 68.6% Facilities 8 16.7% 80 30.2% 88 28.1% 18 16.7% 11 31.4% Fees 8 16.7% 24 9.1% 32 10.2% 5 4.6% 5 14.3% Food & Beverage 0 1 0.4% 1 0.3% 0 0 Merchandise 0 1 0.4% 1 0.3% 0 0 Other 0 4 1.5% 4 1.3% 1 0.9% 0

Classic 18 Course Satisfaction ratings to the contrary, the aspect of the golf experience getting the most positive results was the golf course, mentioned by 44.7% of all respondents.

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Within this category, challenge was the most popular remark, followed by “fairness” and “variety.” Women were more impressed with the course aesthetics. The next highest group was course maintenance. General course maintenance was the most mentioned within this group. The next most frequently mentioned were comments about the facility itself. Here, almost most of the comments were about its favorable location, with the range being the second most mentioned. One in five made positive comments about either the staff or customer service. Of these, “friendliness” was most frequently mentioned, followed by general positive comments about the staff. East 9 As with the Classic 18, positive comments about the course itself were most common, mentioned by over half the respondents (56.5%). Receiving the most accolades was the challenge of the course followed by general layout or design comments and then playability. Course Maintenance was the second leading vote getter, with 36.1%. Most of these comments dealt with general course conditions. Greens and fairways were mentioned by four people each. Needs Improvement Similarly, we grouped the free-form comments about what needs improvements into logical segments. The table below provides a summary. Comments Need Improvement Classic 18 East 9 Anets Females Males Total CL # % Resp # % Resp # % Resp # % Resp # % Resp # Responses 48 265 313 108 35 Customer Service 6 12.5% 32 12.1% 38 12.1% 8 7.4% 7 20.0% Course Maintenance 8 16.7% 111 41.9% 119 38.0% 19 17.6% 8 22.9% Golf Course 8 16.7% 57 21.5% 65 20.8% 10 9.3% 8 22.9% Facilities 13 27.1% 59 22.3% 72 23.0% 12 11.1% 2 5.7% Golf Carts 8 16.7% 12 4.5% 20 6.4% 3 2.8% 0 Operations 11 22.9% 63 23.8% 74 23.6% 17 15.7% 8 22.9% Fees 8 16.7% 69 26.0% 77 24.6% 28 25.9% 0 Food & Beverage 18 37.5% 41 15.5% 59 18.8% 14 13.0% 0 Merchandise 1 2.1% 3 1.1% 4 1.3% 1 0.9% 0 Other 0 2 0.8% 2 0.6% 3 2.8% 0

Classic 18 Course Course maintenance was the most frequently criticized, with 38% of the respondents mentioning it. This is very close to the number that commented on

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Golf Operations Assessment Customer Survey course conditions favorably. Greens received the most negative comments (8.9%) followed by bunkers (8%) and general conditions (5.4%). Notably, women were much kinder than men as 16.7% mentioned course maintenance items compared to 41.9% of the men. Fees were the next most frequently mentioned, with 26% of the respondents feeling at least some aspect of the fees was too high. General fee comments were the most frequently mentioned (14.7%). No other element received more than 2% of the comments. Operations was mentioned by 23.6% of the respondents. The biggest issue was pace of play, with 11.5%. Not being able to take carts into the parking lot was the next most mentioned, with 2.2%. No other aspect received over 2%. Facilities were criticized by 23% of the respondents. Adding grass tees to the range was the most frequently mentioned (6%), followed by adding a short game area (3.2%), and general “improve the range” with 2.9%. A new dining room was mentioned by 2.6% of the people and a new clubhouse by 2.2%. Aspects of the Golf Course were mentioned by 20.8% of the people. Adding full cart paths was the most mentioned (2.9%), followed by “better greens” (2.6%). Women were more than twice as likely (37.5%) as men (15.5%) to criticize the food and beverage services. The most popular suggestion being “add beverage cart service” with 6.1% of the respondents, followed by general improvement (4.2%). The customer care element receiving the most criticism were the rangers, mentioned by 20 people or 6.4% of the respondents. East 9 The aspect receiving the most attention as to needing improvement was the fee structure, mentioned by 25.9% of the commenters. Within fees, the area seeing the most comments was the general fee structure (11.1%). No other aspect received more than 2%. The next most commented was course maintenance, mentioned by 17.6% of the respondents. Bunkers was the leading concern, mentioned by 9.3%. The rough being too high was noted by 2.8%. Pace of play, noted by 10.2% of the people, was the biggest concern about operations, which was mentioned by 15.7%. Only 11.1% mentioned anything dealing with the facilities. Unlike with the Classic 18 responders who focused on the range, the main concerns were bathrooms (3%) and the clubhouse (3%). Thirteen percent of the commenters suggested improvements with food and beverage. General comments and food quality, with 3.7% each, were the two areas receiving the most notice. Adding beverage cart service was right behind at 2.8%.

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Custom Questions NPD and golf course management created several custom questions that were added to the survey. When examining the responses, please keep in mind that they are coming from your customers. They are already playing the course, and most of them are frequent players. As such, some of their answers may be selfishly motivated. For example, when we talk to customers of courses across the country, the two biggest complaints are almost always fees and pace of play. Golfers want to be able to play as fast as they want, meaning they do not want to share the course with others who may slow them down. And they want to pay as little as possible to do so. Obviously, these motives are in direct opposition to the operator’s goals, which is normally to maximize revenue. Where you play Golfers taking the Classic 18 survey were asked what percentage of their play at SCC How often do you use the driving range? was on the East 9. Similarly, East 9 players were asked what Classic 18 East 9 percentage of their play was on # Responding 313 108 the Classic 18. What we found was there was very little cross- 315 108 over. Only 16.8% of the Classic Never 18 players played on the East 9 # 66 27 and only 15.9% of the East 9 responders play on the Classic % 21.0% 25.0% 18. 1-3 How often do you # 83 35 use the range? % 26.3% 32.4% 4-6 The responses are seen in the table to the right. # 60 19 % 19.0% 17.6% Only 21% of the respondents for 7-10 the Classic 18 and 25% of the # 26 8 respondents for the East 9 said % 8.3% 7.4% they never use the range. >10

# 80 19

% 25.4% 17.6%

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How much would you pay to fund improvements? Only about a third of the respondents for both the Classic 18 and East 9 surveys said they did not How much would you pay to want to pay any more to support improvements. fund improvements? Over two-thirds of the golfers on the Classic 18 Classic 18 East 9 survey said they would pay more, and nearly that 313 106 many (63.3%) said they would on the East 9 Nothing survey. # 103 40 % 32.9% 37.7% Notably, 28.8% said they would be willing to pay $1-$3 at least $4 more for improvements on the Classic # 120 49 18. This compared to only 16.1% on the East 9 % 38.3% 46.2% course. $4-6 # 54 11 % 17.3% 10.4% Whatever it took Opinion on the East 9 # 36 6 Survey % 11.5% 5.7% takers were asked “Choose the statement(s) Opinion of East 9 below that represents your opinion about our Classic 18 East 9 East 9 Golf Course”: # Responses 289 110 Over half the players taking the East 9 survey Love it as is answered that they love it just as it is. This is # 111 58 reasonable as they are the heaviest users of % 38.4% 52.7% the course. However, a little more than a third Improve to Classic Quality of the Classic 18 responders said the same # 77 17 (38.4%). Again, the courses are currently % 26.6% 15.5% serving two very different markets. Too expensive A little over a quarter (26.6%) said they # 30 20 thought the course should be improved to the % 10.4% 18.2% same quality as the two nines of the Classic Too Long 18, thus making SCC a “true” 27-hole layout. Only 15.5% of the East 9 survey takers said # 0 1 the same. % 0.0% 0.9% Too Difficult Notably, only one person out of 399 people answering the question said it was too long. # 1 0 Unfortunately, we did not ask the opposite. % 0.3% 0.0% Similarly, only one person said it was too Other difficult. # 70 14 Price was an issue for 10.4% of the Classic 18 % 24.2% 12.7% respondents and 18.2% of the East 9

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Golf Operations Assessment Customer Survey respondents. As an operator, if you do not get any complaints about the price, you are most likely way undercharging. Nearly a quarter of the Classic 18 surveyed checked “other” as did 12.7% of taking the East 9 survey. The most popular Classic 18 response was “never played it” (5.2%), followed by “it is fine” (4.8%) and “haven’t played it much” (4.8%). Five (1.7%) thought the pace was too slow, and four (1.4%) basically said it “was a waste of real estate.” The “other” response that had the most traction with the East 9 respondents was “it is fine” with four respondents (3.6%). Nothing else got more than two responses. Do you enjoy Executive Length courses? This question was asked, in part, because one of the options being studied was to Do you enjoy Executive Length shorten the East 9 course to free up room Courses? to move the range and build a short-game Classic 18 East 9 Anets area. This option was later discarded as not being in the golf operation’s best interest. # Responses 308 104 34 Yes

# 19 21 10 About two-thirds of the Classic 18 % 6.2% 20.2% 29.4% respondents said “no”, while less than half Occasionally with kids of the East 9 (43.3%) said the same. # 27 6 6 About 28% of the Classic 18 takers and % 8.8% 5.8% 17.6% 46.3% said they would play one “occasionally,” and just 6.2% of Classic 18 Occasionally because they're faster and 20.2% of East 9 respondents said # 59 32 9 “yes.” % 19.2% 30.8% 26.5% No

# 203 45 9

% 65.9% 43.3% 26.5%

Do you consider Sportsman’s when looking to book an outing or event? As expected, most of the respondents (69.7% for Classic 18, 75.9% for East 9) answered that they don’t book outings or events. Another 36 of the Classic 18 respondents did not even bother answering the question. Of those answering either “yes” or “no”, the clear majority (77.3%) of the Classic 18 players said they would not. On the other hand, half of the 26 respondents for the East 9 said they would.

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It was then asked: “If not, why not.” The biggest response (11) was that the facility was “of poorer Do you Consider SCC for an quality” without naming any specifics. Five of the event? Classic 18 responses were not specific as to why. East Four said it was “the facilities”, three mentioned Classic 18 9 thefFood and beverage service. None of the East 9 responses gathered more than two people. # Responses 277 108 Yes Availability of Carts # 19 13 % 6.9% 12.0% In wet conditions, SCC will not allow golf carts on No the course. This is because of the damage they # 65 13 will do to the turf in these conditions. The presence of cart paths, which neither course has, % 23.5% 12.0% would allow people to play the course under these Don't book conditions. So, we wanted to know how our # 193 82 respondents reacted to the “no carts allowed” % 69.7% 75.9% time periods.

Availability of Carts when Wet A little less than half the responders (48.2%) from the Classic 18 survey indicated the carts East were of no concern as they walk anyway. The Classic 18 9 number was even higher for the East 9 at 62%.

Over 30% of the Classic 18 responders and 25% # Responses 311 108 of the East 9 responders indicated they either will I walk not play or will take their business elsewhere. # 150 67 This represents a total loss of revenue from these % 48.2% 62.0% players. Will play elsewhere Another 21.5% of the Classic 18 respondents and # 50 6 13% of the East 9 said they will walk in these % 16.1% 5.6% conditions, but would have preferred to ride. Choose not to play Thus, the facility loses the cart revenue but not # 44 21 the green fee. % 14.1% 19.4% But we also must look at it from a customer Will walk, but prefer to ride service standpoint. We are making most of the # 67 14 players who play the Classic 18 unhappy when % 21.5% 13.0% carts are not allowed, and nearly 40% of the East 9 players. No doubt this becomes part of their overall satisfaction with the course.

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Factors that keep you from playing more rounds at SCC The question was asked “what are the main factors that keep you from playing more rounds at Sportsman’s” (or Anetsberger for those taking that survey). Survey takers could check all the factors that applied. The full table can be found in Appendix F. In the table, the percentage refers to the percentage of people taking the survey. Not having enough time was the overwhelming leader in terms of number of responses. What is interesting is that this was less of a problem for those playing the Classic 18, which is much longer, than the other two courses. 43.8% of the Classic 18 responders, over half (54.6%) of the East 9 and nearly half of the AGC survey takers felt this was one of the main inhibitors from playing more rounds at the facility. Notably, no one thought the greens were too fast at any of the courses, no one thought Classic 18 or East 9 were too difficult and only one person said AGC was. Only two people said East 9 was too long, none thought this about Classic 18 or AGC. And for all the complaints about course conditions, it did not seem to be a big inhibitor as just 8% of the Classic 18 responders, 5.6% of the East 9 responders and none of AGC’s said this was an issue. Price was a factor, either in terms of cost or value, for some of the responders. 16.6% said cost was keeping them from playing Classic 18 more, and 17.3% said the value was too low. For the East 9, 19.4% indicated it was too expensive for them to play more and 7.4% thought it was the value they were receiving. This was not a big issue for the AGC responders as none indicated cost and only two (5.7%) thought value was keeping them from playing more. Another factor receiving a lot of attention was that the golfer simply liked playing a variety of courses. This was more an issue for the Classic 18 group (36.7%) than East 9 (25%) or AGC (5%) While the percentage of people indicating that cart quality was a main issue was relatively small (7.7% for Classic 18 and 1.9% for East 9), it is still more than we are used to seeing. This is the first course I have worked with where the quality of the carts was such an issue, as indicated in their satisfaction scores and as a factor in not playing more. Miniature Golf Golfers were asked “Would you say a renovation of the miniature golf course at Sportsman’s is”: Over half the Classic 18 respondents and nearly two-thirds of the East 9 (63.2%) did not care.

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Only 7.7% of the Classic 18 group and 3.8% of the East 9 group indicated it was extremely important to them.

Family Tees Importance of renovating miniature There were two questions asked of the golf East 9 group regarding the family tees Classic 18 East 9 and the family rate on the East 9 course.

The first asked if they like the family tees, which are used almost exclusively by # Responses 312 106 juniors, and the second asked if they were Extremely important aware of the family rate. The results table # 24 4 can be found in Appendix F. % 7.7% 3.8% On the first questions, 18.7% indicated Not at all important that they liked the tees, 6.5% said no and # 128 35 the overwhelming majority responded that % 41.0% 33.0% it was not applicable (keep in mind that Don't care most of the responders were over 50 and # 160 67 thus less likely to have juniors in the % 51.3% 63.2% home.) Of greater concern was the fact that only 13 responders said they were aware of the family rate, while another 33 (30.8%) said they were not, while the rest said it was not applicable (57%). Thus, of the people who would seem to care about family rates, only one fourth of them knew about them. Short Game Area AGC survey takers were asked how often they used the short game area at the facility. One fourth said they never used it., while a little more than a fourth (28.6%) said they used it more than 10 times. 20% indicated between 1-3 times a year, another 20% between 4-6 and 2 said 7-10 times. Play without Pay? We were told that walk-ons, people who play the course without paying, are a problem at AGC. So, two questions were asked about this issue. The first wanted to see if anyone would confess to this. None did. The second asked if they had ever witnessed this happening. Nearly a third (31.4%) said they had. This is an alarming rate and does indicate that this is a significant issue. Not only do you lose revenue from the people who do not pay, but those that do pay are made to feel, “why should I be paying when those people aren’t?” Importance of Improvements The final set of questions dealt with specific improvements. While some of the responses may have been rated of low importance to them, this does not necessarily mean it is a bad idea from the operator’s perspective. After all, one objective may be to reach people who are NOT currently playing the course and this

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Golf Operations Assessment Customer Survey may be a crucial factor for them. And secondly, remember golfers are typically not going to recommend things that they feel is going to make the course more crowded or more expensive. Responders were asked to rate the importance of each factor on a scale from 1 to 10, where “1” meant unimportant and “10” meant extremely important. Results are found in Appendix F.

The factor receiving the highest ratings from the Classic 18 voters was “adding a short game area,” which got an average rating of 6.8. 35.4% of the responses were either a “9” or “10” compared to 13.3% with a “1” or “0” (Note responses of greater than 10 were assigned a value of 11). The second highest rated for the Classic 18 users was adding grass tees to the range, with an average score of 6.58. It was followed by Improving the Quality of the Classic 18 (6.31), Improving the Greens on the Classic 18 (6.17), Adding Covered Stalls to the Range (5.30) and Adding Target Greens (4.84). It is important to note that three of the top five had to deal with the practice facility. Adding grass tees was also the factor that Classic 18 responders felt most passionately in favor of, with 43.2% of the responders rating it a “9” or “10”. It was followed by Adding a Short Game Area (35.4%), Improving the Classic 18 Greens (29.3%), Converting carts to electric (24%) – which is an amazing number for this topic, and allowing carts into the parking lot with 19%. For the East 9 responders, Improving the East 9 course was their highest priority, with an average rating of 5.72. It was followed by Adding Short Game Area (5.53), Adding Grass Tees (5.11), Allowing carts into Parking Lot (4.75), Adding Target Greens (4.51), Adding Covered/heated stalls (4.33), Renovating the Clubhouse (4.31), and then Improving the Quality of the Classic 18 (4.2). In terms of passionate feelings, the factor receiving the highest percentage of 9s and 10s was Adding Grass Tees to the Range (27.2%). Next was Improving the East 9 (22.4%), Allowing carts into the parking lot (21.6%), Converting carts to electric (20.2%) and adding a short game area (18.7%). Discussion So, what does all this feedback really tell us? As we discussed in the Financial review section, the golf operation is basically operating on a break-even basis as far as operating costs. It is not, however, generating enough to cover any capital improvements. What is concerning is that SCC relies predominantly on repeat play that is coming primarily from the immediate area, especially Northbrook. SCC is not attracting a lot of occasional play from outside the immediate area, nor is it really trying to, given its anemic advertising budget. But there are several problems with this strategy. First, our customer feedback seems to indicate that, by far, the best thing SCC has going for it is its location. While this attribute is a good one to have,

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Golf Operations Assessment Customer Survey it does little to help you attract people from outside the immediate area. Further, we find that both the customer base of SCC and the community of Northbrook is aging. While this may be good for the short-term, it is not for the long-term. Moreover, seniors, while great for weekday play, represent the lowest spending demographic in golf. So, while the volume is decent, the yield per round is not as strong as it would be with more younger golfers. In this case, we are defining “younger” as non-seniors, not necessarily millennials. The customer feedback clearly shows that SCC has a lot of short-comings when measured against the stiff competition it faces. Being merely “good” is not good enough in this market to succeed. From our interviews with staff, customers and stakeholders, it is clear that SCC has made tremendous strides in the past several years, primarily with its course conditions, but also in customer service. But apparently, while this has helped close the gap with competition, it has not made it equal. As we will discuss in the Architect’s section, it would be difficult to make significant further improvements in course conditions, given the aging infrastructure of the course, especially the greens, tees, bunkers and drainage. We also see the Classic 18’s length as a significant inhibitor in increasing market share. It virtually eliminates 15% of the market that prefer to play from 6,600 yards or more and creates a negative stigma that has a negative influence on other golfers as well. Greens and bunkers were especially called out in the feedback. Again, there is only so much that can be done with the current infrastructure. The good news in all this is that should NPD decide to invest significantly in SCC, there is every reason to believe it will have a tremendous positive impact on performance. It should not only increase the volume of play (rounds) but also increase the yield. The customer feedback also confirms what is obvious to us in that the food and beverage operation is a mess. It is far below the expectation for a course in this price range and no doubt is a major factor in keeping other play away. We also learn that the current customer base is passionate about improving the practice facilities at SCC, and this is already the best performing aspect of the operation, along with the Academy (which is closely tied to the practice facilities). Again, this confirms our own impressions.

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We will be talking extensively about the golf courses and the range in the next section, Architect’s report. In this section, we will be talking about the other facilities that are part of NPD’s golf operation. Sportsman’s Complex The entire Sportsman’s Country Club complex sits on a little over 200 acres. This is tight quarters for 27 holes of regulation golf, a driving range and a miniature golf course. For comparison, this is the size lot used for modern-day 18-hole courses. As noted previously, the initial appearance of the facility to the new customer is mostly negative. The sign is old and set too far back. The road is lined with an ugly net (which is too short), the range is unimpressive and old fashioned, the parking lot appears to tight, with narrow gaps between the rows. These narrow gaps have led to the policy of forbidding carts in the parking lot. This move, alone, costs SCC customers. The range is located at a distance from the clubhouse. This is great if you are only wanting to use the range. But for golfers who wish to warm up before playing, it is a huge inconvenience, especially since they cannot take a cart to go from one to the other. As a result, SCC is losing a lot of revenue from “warm-up” range balls. Next, you drive by the miniature golf course, which looks terribly out of place. It also looks dated and unappealing even as a miniature golf course. The clubhouse is set far back from the parking lot, forcing customers to walk a distance to get to it, sometimes carrying their heavy golf bags if they choose not to use the bag drop area. And there are legitimate reasons why some golfers do not like to use a bag drop service. First, they feel a need to tip the person, which adds to the cost of the round. And if they do not tip, they may feel some guilt. Second, if there is not a person attending the drop at the time they leave their bags (which happens, especially early in the morning), there is a concern about possible theft (although this has not been an issue at SCC). In any case, anytime you are inconveniencing your customer, it is not a good thing. And it contributes to the overall satisfaction of the playing experience. And the clubhouse, itself, appears very dated and unappealing from the street. And sadly, this impression is confirmed upon walking in. In short, a negative expectation is being established before the golfer ever sees the golf course. This makes it all the harder to win over a golfer, especially in such a highly competitive area. SCC Clubhouse The clubhouse is roughly 10,400 sf in size. Half of this space is in the basement, inaccessible to the customer. The full basement area contains lots of storage and all the office space. The basement is accessible by two narrow staircases, one

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Golf Operations Assessment Facilities coming down from the kitchen, the other from the proshop. There is no elevator, which makes the space unusable for customers. The narrow staircases make the basement an awkward space for storage. It is certainly not convenient for staff to have to go downstairs anytime they need something, because storage space on the main floor is extremely limited. This creates inefficiency. But because there is no elevator, it also makes it difficult to get bulkier or heavier items from one floor to the other. And this can also be a safety issue if the employee is having to carry a large amount of goods up a very narrow staircase. (An elevator would likely cost $50-$60,000 to add). Offices But the worst aspect of the basement is the fact that this is where all the offices are. Thus, the managers are completely isolated from the very employees and customers they are hired to supervise and assist. It not only creates significant management issues, but it also hurts public perception as the customers are not able to see the manager. The managers can and do take time to walk upstairs and observe and interact. But this then takes them away from their other duties. And being downstairs also makes them appear inaccessible to the employees, who perhaps, will be less inclined to bring issues (or suggestions) to management that may be important. Upstairs is no better. The entire ambience is bad, as it appears very dated. We will talk about each area in turn. Further, we might add, the building has significant design and mechanical issues with its HVAC system. This only adds to the customer discomfort and can affect employee morale. Proshop The proshop is not very inviting to the customer. In fact, it’s the opposite. The proshop is crammed with merchandise displays that make the proshop feel extremely cramped, even when no one is in there. But with two busy golf courses operating out of, its often full of people, making it seem even more cramped and uncomfortable, especially as the heat generated by the people increase. Then there is the counter. The counter is this huge monstrosity that provides a barrier between the staff and the customers. And that’s what it feels like. It is way too high, making it difficult for shorter customers to even see over. It also makes it impossible for a seated staffer to properly surveil the proshop in slower times. The “barrier” is as psychological as it is physical. It makes it difficult for a staffer to come out and help a customer, even if they are motivated to do so. It is certainly intimidating to the customer, which is definitely not what you want. And it may be contributing to a negative impression among customers about customer service, even though the people behind it are very good.

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The proshop displays spill over into the hallway that separates it from the grill area. This certainly looks awful. And because there is a wall between the hallway and the proshop, it is impossible to monitor the area from the proshop. Food Service Area The fact that I could come up with no better descriptor than “food service area” illustrates the problem. One would expect in a $70 golf club to have a nice eating area that can be described as a “restaurant” or a “grill” area. But this is not the case at SCC. Instead, it is more reminiscent of a concession stand at a sports arena. Food is ordered and received at a window. There is no bar, even though a full range of alcoholic beverages are sold. There are a few TV screens scattered about, but they are small by modern standards and not enough to give the room a “sports bar” feel. Regardless of the actual quality of the food and service that you may receive in such a situation, your expectation is bad. The image given the price range of the club, is bad. It is a complete market mismatch, which is bad for both the golf and the F&B sales. A high-end golf course should not have a concession stand as its primary F&B operation, even a good-quality standard facility could not get away with it. Yet this is what we find at SCC, located in prestigious Northbrook. It is completely out of place and it is no wonder why it does so poorly. There is no doubt that the food and beverage operation and the lack of a decent place to eat is hurting business at the golf course. It is more than just the revenue lost from F&B sales, but it serves as a deterrent from golfers who enjoy relaxing and drinking and or dining after a round (and often before). The actual space, in terms of seating area, is good-size for a dining area. But there is only one area. This makes it extremely difficult to have functions, even golf functions, at the facility. Nor is there an outdoor pavilion or tent area to host outdoor events. The lack of banquet area not only denies SCC from banquet revenue, it makes it extremely difficult to attract tournaments and large golf outings. As a 27-hole operation, SCC should be a prime candidate for hosting large tournaments, instead it hosts very few. Most its tournaments and outings are 30 or fewer golfers. Furthermore, the acoustics in the dining area are horrible as I can personally attest. Twice I tried meeting with people in there when it was less than half filled. It was so noisy that we were forced to move outside so that we could hear each other. The view from the dining area and the attached patio area is nice, but people would generally prefer to be looking at the greens, rather than people teeing off. Locker Rooms SCC has locker rooms for both men and women. Locker rooms are seldom utilized in modern public golf courses. At most, we see from 5-10 lockers that are rented

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Golf Operations Assessment Facilities for the day, and a single shower. Further, women are discriminated against as their locker room does not contain a shower while the men’s does. Miniature Golf Miniature golf has a long history at Sportsman’s. And it does have its fans. The general thought behind it was that it gave a place for the children to play while the parent uses the range. In practice, though, this rarely happens as we see about 40% of the play coming from adults. The course appears very dated and is completely mismatched when compared to other miniature golf facilities such as Par-King. Par-King probably does as much business in a good weekend as SCC’s course does in a year, as last years $23,260 in revenue shows. To NPD’s credit, new carpet was installed this year, which helps the playing conditions. But it does little to improve the aesthetics or enjoyment. But as one Commissioner put it, “we need a better location or better clowns.” In talking with Commissioners, stakeholders, staff, and customers, while many people, especially staff, that would like to see it gone, there seems to be a stronger sentiment that having miniature golf is important to NPD. But not necessarily at SCC. To us, it would make much more sense to have the miniature golf at AGC, where it fits in extremely well with the youth-oriented facilities at AGC and Techny Prairie Park and Fields. A new facility can be constructed that can be closer in quality to Par-King, with outstanding exposure, given the nature of Techny Prairie Park and Fields. Other Sportsman’s Facilities SCC Maintenance Facility This is one area where SCC shines. It’s course maintenance area is state-of-the- art. This helps attract and retain quality staff and managers, and greatly improves efficiency. Halfway House The Classic 18 features a “halfway” house. There are no significant issues associated with the facility itself, although we certainly heard complaints about its operation. The biggest issue is that it only serves the Classic 18. Further, the F&B operator seems to think that having a halfway house removes the necessity of using beverage carts. We strongly disagree with this notion. We will have more to say on this in the Operations section. On-course Restrooms and Amenities To its credit, SCC recently installed on-course restrooms. This is a crucial step as women especially, as well as seniors greatly disdain using port-a-potties. We do

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Golf Operations Assessment Facilities question the location chosen for some of these, especially on the East 9 where it is on the last hole, where it would seemingly be of least utility. The other issue with the restrooms is the quality of the interior. The outside building is nice, and consistent with the price-point of the course. But the interior is minimalist, with bare, uncoated concrete floors and minimal fixtures. This is what you would expect at a low-end golf course, not a premium facility in Northbrook. We would also like to see more benches at the tees. This is especially important at SCC where the market is heavily oriented towards seniors and more than half the play are walkers. The benches should also be located at the tees that are most used, such as the forward tees and the white tees. Range Building The range building serves the customers using the range and the miniature golf course. It must be staffed as the clubhouse is too distant, thus creating an automatic operating inefficiency. It not only adds labor costs, but makes it far more difficult to supervise and manage. The building itself is nondescript. It is adequate for its purpose. The back rooms serve as the location for the ball washer, storage and an equipment repair room. There is no room for what is really needed, which is an indoor training room. Cart Building The cart building used to be a bowling alley earlier in its life cycle. It is now where the golf carts are kept. A portion of the 11,000 sf building is not being utilized for any purpose. Other than the sheer size, there is not much to like about the cart barn. It is somewhat remote from the clubhouse, which creates inefficiencies and makes it more difficult to supervise. The roof is in bad shape. It is not equipped to handle electric carts, which the customers would strongly prefer. But most damaging is that it is extremely dirty, filled with birds and dust. Clean carts that are put inside in the evening are dirty again in the morning. This is not an issue of housekeeping, as they regularly wash out the area. But seems more to do with the poor air circulation, the aging timber and dry wall, and the presence of lots of birds. In this area, the clear majority of facilities have their carts stored under the clubhouse for maximum efficiency. However, perhaps the most practical solution is to build a new clubhouse, with cart storage underneath and then raze the current cart building entirely, thus removing an eyesore and providing room for additional parking or a short game area. Anetsberger The Anetsberger golf course is part of Techny Prairie Park and Fields. There is a very active walking trail that goes around the perimeter of the course.

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One of the biggest problems noted at AGC is the substantial number of “walk-ons”, people who play the course without paying. Because of the remoteness of the clubhouse, and the openness of the grounds, and the proximity to neighborhoods and roads where it is easy to park and simply walk on to the course, it is easy for people to do this. Furthermore, since staff is limited at the course, with only one person on duty at a time, and they do not start until 8am, it makes it even harder to monitor and control. It is very easy (and frequently done) to come and play the course before staff arrives. Clubhouse The biggest issue with the clubhouse at AGC is its location. It is impossible to see the first tee from it. This is a huge issue as it severely hampers the staff’s ability to control access and flow on the course, a must in any golf operation. The proshop is small, with little display area for merchandise, virtually no storage area, and no capacity for any type of food and beverage operation. Across an open, covered walkway are the restrooms. These are heavily used by park users other than golfers. Maintenance Another big issue is the maintenance facilities at AGC. Simply put, there are none. Maintenance equipment is being stored at the Parks Maintenance Building, which is remote from the course. This greatly impedes work efficiency as it requires excess time to get the equipment to and from the course, plus adds to the fuel costs. Further, there is limited room for equipment or supplies, making it necessary to bring such from time to time from SCC, which again is inefficient for many items. (Some items, however, are better shared as there would not be enough use at AGC to justify having its own equipment). But there needs to be onsite storage for basic items such as sand for the bunkers and topdressing the greens. A 40’x80’ metal building would cost $40-$50,000 or about $3,518 in annual debt service. This would be more than made up by the gained efficiency. It would also allow for the storage of five golf carts that can be used for operations, generating more revenue for the course. Recommendations Entrance There should be a new sign for Sportsman’s (which preferably would be done as part of a rebranding effort). It should be more visible for east-bound cars on Dundee. Estimated cost: $150,000. Benefit: No measurable effect, just greatly helps with image and walk-in traffic. Parking Lot Ultimately, a new parking lot should be created that eliminates the green area and pond by the clubhouse so that customers can park closer to the clubhouse. This

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Golf Operations Assessment Facilities will become critically important if the clubhouse is renovated, with a new restaurant and banquet area. Thus, the cost for this is included in the clubhouse construction costs. In the interim, we recommend creating a cart path down the west side of the parking lot with a parking area next to the range. This will allow golfers to more easily go from the clubhouse to the range, with their clubs. It is critically needed if carts continue to not be allowed in the parking lot. Less important if this policy is changed. The construction of this path would depend on if NPD plans to move the range as recommended. If so, then it would not make sense to use any kind of permanent materials. A gravel path would be more than sufficient. If the range is to stay where it is, a paved path would be preferred. Clubhouse We will talk about needed renovation to the range and golf course in the architect’s section. If these are done, it would be an excellent time to also do badly needed renovations to the other facilities and amenities at SCC. We note that parking lot improvements is being covered in the Architect’s Report. As we will discuss more later, we see any major renovation effort being combined with rebranding to reshape the image of the facility in the consumer’s mind. This would include new signage. The biggest facility need is to build a new clubhouse. In our opinion, simply renovating the existing clubhouse would not meet enough needs. For example, it would not add banquet space, thus depriving the operation a significant profit center, and it would not likely allow offices to be moved upstairs, nor would it address the cart storage issue. Our recommendation is to build a new clubhouse, to be located approximately where the current cart staging area is, that would have cart storage underneath. The new cart storage area would be configured to allow the use of electric carts, which are much preferred due to the reduced noise. The proposed clubhouse should: • Be about 10,000-12,000 sf in size • Have a banquet room large enough to handle at least 200 people (preferably 300). The room should be able to be subdivided into at least two smaller rooms, making it easier to host smaller events or to host two small events simultaneously. • Have a commercial kitchen • Have a bar area, configured like a sports bar • Have table service dining room with a capacity of 65 or so. • Have a private dining room, capable of seating 25-40.

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• Have a bridal changing room • Have at least five offices for management • Have a large deck • Have an indoor training area under the clubhouse (cart storage would take up about half the basement area) leaving room for storage as well as an indoor training area that should include a classroom, a practice green, and hitting bays. This will greatly enhance the Academy, allowing it to become a 12-month operation, as well as improving camps, etc. Because the cart storage will be underneath, the clubhouse will be elevated relative to the golf course. This will greatly enhance the view from the dining, banquet and proshop areas. A large deck will further enhance the clubhouse’s appeal. In conjunction with the new clubhouse, the parking lot would be completely redone, eliminating the green area and retention pond in front of the clubhouse, and increasing the size to 325 spaces. This will allow for more convenient parking, essential for the restaurant, and allow banquets to occur during golf peak times. Paying for a New Clubhouse NPD and SCC will both benefit from a new clubhouse. For SCC, the new clubhouse will greatly enhance the appeal of the facility, add new profit centers, allow the facility to become a 12- month facility, and New Revenue from Golf greatly improve the Yield Qty Revenue efficiency of the New Tournament Golfers 1,500 operation Average GF and CF $65.00

Average Merchandise $7.50 For NPD, it will add a new 12-month facility Total Yield per Round $72.50 that will provide services Total Revenue $108,750 to non-golfers as well as New Classic 18 Golfers 2,000 golfers. The restaurant, Average GF $33.24 assuming a prudent Average CF $8.83 operator, will help fill a Average Merchandise $4.10 need for a quality Average Range $1.50 restaurant on that part of Total Yield per Round $47.67 Dundee, which is directly Total Revenue $95,334 opposite a large office New East 9 Golfers 1,500 park. This is particularly Average GF $18.14 important for the lunch Average CF $3.80 traffic. The private Average Merchandise $4.10 meeting room and Average Range $1.50 banquet facilities would Total Yield per Round $27.54 help fill a need for the Total Revenue $41,309 district. Grand Total $245,393

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Further, the aesthetics of the facility should fit NPD’s and the community’s self- image far better than the existing facility. Doing a true feasibility study for a new clubhouse is well beyond the scope of this study. However, we can do a simple analysis that will provide a good estimate. Golf It is hard to measure the impact of the clubhouse alone on golf performance as there is little data in which to base it on. Most facilities that build new clubhouses are also doing significant improvements to the golf course, making it impossible to determine the individual impact. However, we do know it will have some. Our own customers have told us as much. And these customers have already been trained to not have a good F&B operation. But there is a large segment of golfers who do want to relax after playing a round of golf, either taking in a drink and or eating. We know that facilities in the price range of SCC generally take in about $10-$12/round on food and beverage excluding banquets. SCC is currently generating $3/round. It is reasonable to conclude we are missing a lot of these golfers. Further, without banquet facilities, SCC is not being considered as a host to tournaments and outings. As these events usually command a premium charge in this area, they are the most profitable rounds. Conservatively, we would estimate another 1,500 to 2,000 rounds can be obtained annually from hosting tournaments and events. We also estimate another 3,000 to 3,500 rounds will be gained from golfers who will now come to the course because it has a bar and restaurant. Using these estimates, we can generate an educated guess on the additional revenue from golf generated by the new clubhouse. We will assume the more conservative 1,500 rounds from tournaments and outings. These would all be played on the Classic 18. The likely average fee for these rounds is $65, which would include range usage. Tournament users also tend to spend more money in the proshop, so we have estimated this to be $7.50 per person (the actual yield would likely be over $10, assuming we have nice logo shirts and caps). Combined this yields $72.50 per person or round, generating a total of $108,750. While the current split of golfers is about 50/50, we believe the golfers who will be attracted to the facility because of the bar and restaurant are more likely to also want to play 18 holes of golf. Our actual estimate of this split is 80/20, but we will be more conservative and have 2,000 playing Classic 18 and 1,500 playing the East 9 (They are also more likely to be cart users). Next, we plugged in the actual yields we are currently seeing for each course. Again, this is being ultra conservative as we believe these golfers are more likely to be non-residents, and thus more likely to be paying rack rate. We also believe that if the course is rebranded, as it should be, with a new logo, merchandise sales will jump.

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When all these factors are put together, we get an increase in revenue of $245,393. Almost all of which is pure profit. It is easy to imagine this number being at least $300,000 or more. From Food and Beverage First, we will look at the added total revenue from food and beverage. Currently, F&B is yielding just $3/round. If we assume a good year, this equals $180,000/year in revenue. With the new facility, the F&B revenue should be at least $10-$12/round, excluding banquet revenue.

However, with new parking and a good operator, the restaurant should do a substantial amount of non-golf business (Arrowhead would be a good model to look at). We are conservatively estimating 50 people a day during the golf season, when the restaurant will be busiest with golfers, and 120 during the off-season, when parking and access will be much easier. Food and Beverage Daily Avg # Annual Qty Avg Yield Total Days From Golf 65,000 $10.00 $650,000 Restaurant in-season 50 180 9,000 $25.00 $225,000 Restaurant off-season 120 180 21,600 $25.00 $540,000 Banquets $1,500,000 Total $2,915,000 NPD's share 10% $291,500 Assuming a conservative yield of $25 per person (this includes bar revenue), we get $225,000 restaurant business in-season and $540,000 out of season. The biggest “nut” comes from banquet sales. We have several facilities that we can use as models. The closest competitor, Chevy Chase, does a little over $3m in total F&B, most of which are banquet sales. They likely will continue to have much larger banquet facilities than what are proposed for SCC, but SCC has a far superior location. And with course improvements recommended, it will also have a better golf course. Chevy Chase is also an 18-hole facility. Village Links, a fellow 27-hole facility, does $2.2m in F&B sales. It is a similar facility to what we propose, but SCC’s location is far superior and in a much higher income area. Arrowhead is the best model to work from. It has a 27-hole course and nice restaurant and banquet facilities. It did $5,230,154 in F&B. Again, SCC’s location is superior and in a much higher income area. We conservatively estimate that the total food and beverage revenue, with a new clubhouse, will be at least $2,900,000.

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If we assume that NPD continues to contract this out, it is reasonable to assume the new lease would be a revenue lease. Such leases typically yield about 10% to the owner. This would mean an added $291,500 in revenue. Combining these two revenue streams yields $536,893 in added revenue to NPD. And this does not include the cost savings from improved efficiencies with the cart operation underneath the clubhouse and management more accessible to employees and customers. Should debt financing be used, the improved cash flow will support a debt of $7,500,000, assuming 20-year amortization and interest rate no more than 3.5%. Other Financing There are a few additional financing opportunities, especially in an area such as Northbrook. They include: • General Bonds: As the clubhouse has benefits to NPD beyond golf, including it in a general bond funding would seem appropriate, at least to cover some of the cost. • Vendor Financing: Several vendors may be willing to foot at least part of the bill in exchange for a long-term lease (at least 15 years). • Donations: Northbrook is a wealthy community, with many its citizens playing the course. A fund-raising campaign would likely be able to fund a significant portion of the costs. • Naming Rights: This has been a successful strategy for a lot of municipalities who sell the naming rights to the clubhouse in exchange for a significant contribution that will cover a sizable percentage of the cost. Again, SCC’s location in Northbrook, where there are several Fortune 500 companies and other large businesses, should prove favorable. Naming rights can also be extended to individual rooms, such as the Allstate banquet facility, etc. Simulators and Indoor Training There will be room under the clubhouse to install an indoor training area and classroom. This will greatly help with the Academy and with junior camps. It also will allow for training during both inclement weather and winter periods. We also recommend adding two simulators. These are great revenue producers and are very popular. Combined, the two simulators (which could be in the old clubhouse), should generate $35,000 to $45,000 in direct revenues, plus another $10,000 to $15,000 in food and beverage. They can also be used for training during slow retail times. Nice simulators run from $30,000 to $60,000 each, installed. Repurposing Existing Clubhouse As we are proposing a new clubhouse to be built, the question then becomes, what to do with the old clubhouse? We can see this building being repurposed. Two scenarios come to mind. It could be fashioned into a senior center or other

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Golf Operations Assessment Facilities community-type center. However, we also see where it could be repurposed to enhance the golf operation. In this scenario, the top floor would become an indoor training center with several golf simulators. The simulators are also revenue generators and a popular with golfers, especially in the off-season. They are also valuable teaching tools. A possible use for the basement would be to make it into a dormitory of sorts that would house interns. Currently, it is hard to attract interns to SCC because its location is remote from where they live. And there is no affordable housing convenient to the course. Yet interns can be valuable assets to the club. It is likely that NPD may have other opportunities for interns in other programs, where a dormitory would be a major enticement. It needs to be pointed out that if the basement area is to be used by the “public” an elevator would need to be installed. This would likely cost at least $60,000.

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We are not going to spend a lot of time going over the details of the operations at the facilities. This is because, in general, they are being managed exceptionally well by a team of highly qualified, knowledgeable, effective and dedicated professionals (besides, it would make for rather boring reading). Instead, we will focus on those aspects of the operation where we see opportunities for improvement. Golf Operations Staffing One of the issues presented to us was concerns over staffing levels at SCC. The concern was that it appeared to be “over-staffed”. SCC does have a lot of employees, 92 to be exact, which is a lot, even for a 27-hole facility, and especially considering that they do not operate the F&B facility. One of the reasons for the large staff is the considerable number of part-time workers that only work a few shifts a week. This is particularly true with starters and rangers, which number 26 just among them. The substantial number is required as most of these employees are retirees who only want to work a few hours a week. Their main benefit is not the pay, but the free golf. Nationally, we see most operations employ volunteers for these positions, who trade their time for golf privileges, but no pay. If the course is following IRS guidelines, the employees are given 1099s for the value of the free golf. However, as they are predominantly retirees, the added income does not increase their tax burden. Locally, though, we were not able to find any courses that employ volunteers, nor were we given an explanation for this. Our suspicion is that it would cause concerns with local unions and the municipalities do not want to risk such a conflict. It would certainly be more efficient, from a management point of view, to employ fewer individuals and require more shifts per individual. This will make it easier on the manager (currently one of the PGA Assistant Pros) as they would have fewer people to hire, train, schedule and supervise. It should also allow for more consistency in service. Another benefit is that it would likely reduce the number of employee golf rounds. However, the original question asked of us was not referring to the total number of employees, but rather the number of employees on duty at any given time. This is a more difficult area to determine. For one thing, it would be impractical for us to physically monitor traffic every hour of every day during the week, especially since there would be no guarantee that that week would be hospitable to golf. However, in most customer service businesses, there are ebbs and flows. If you go into a restaurant, for example, at 2:30pm in the afternoon, you might conclude that it is overstaffed. Four hours later, you might think the opposite. The same is true in

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Golf Operations Assessment Operations golf. While it is true that golf does have a teetime system which will allow a manager to predict the busiest times, it is often impractical to schedule so finely. There may be a surge at 12pm, followed by 2-hour lull, then another surge. You can’t have your employees clock out for two hours then expect them to come back. As a result, a manager often must choose between risking being overstaffed for slower times to be properly staffed at busy times, as opposed to scheduling for the slow periods and then scrambling during busy times. A customer-service oriented company will always opt for the first option. Being understaffed will lead to longer waits, poorer customer service and dissatisfied customers. It also must be taken into consideration that SCC is essentially operating two distinct golf courses out of one proshop, and the two courses have an equal number of customers. Therefore, it is dealing with double the volume of customers as an 18-hole facility. So, it will naturally take more people to serve them adequately. Part of the issue is likely due to presence or absence of the Assistant Pros behind the counter. And this may be an area where improvements can be made. According to the schedule provided, an Assistant Pro opens the facility at 5am. Two cashiers come in at 6am and work till noon. This provides three people behind the counter during the morning period, which is typically the busiest time of the day. At noon, another two cashiers will come in who work till 6pm. There should still be an Assistant Pro on duty. Here is where potential overstaffing occurs. With an Assistant Pro, this means there are still three people behind the counter during known slow periods. Furthermore, there are three Assistant Pros on staff, and while there are a lot of hours to cover (14 hours a day, seven days a week), there are going to be times when all three are present. Of course, these are the times that they should be working on their other duties as each Assistant has an assigned area of responsibility. And that is what normally happens. But it’s also the case that there are long stretches of time when there are no pros behind the counter, just two cashiers. Complicating this is the fact that the 1st Assistant does not have a set schedule. With golf, it is certainly easy to pull up records and determine exactly when the peak periods are most likely to come. The morning peaks are a given, it is the afternoon peaks that are the issue. And these peaks tend to be relatively short, one to two hours (compared to the six-hour shift). Certainly, it would seem possible that by better utilizing all the assistant pros, it would be possible to man these periods with extra assistant pros, who are already working these hours, then to have to pay a clerk for six full hours of work to essentially cover the two hours they are needed. Another successful strategy seen at other courses, is to cross-train employees. Rather than have cart staff always only work carts, rangers only work as rangers, and cashiers only work as cashiers, you can train many of these people to do multiple jobs. Some employees may only be suitable for one task, or suitable for one roll but not another. But with as many employees as SCC has, a good percentage of them can be.

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There are multiple benefits to this strategy. First, it improves morale as employees develop a better appreciation for the work of their fellow staffers. Second, it gives the operator maximum flexibility. In cases of emergency, you always have extra staff that can be called in. Third, it can reduce the number of employees required. The fewer the better from a management and efficiency standpoint. Rather than have two different people working four-hour shifts, it is often better to have one working an eight-hour shift. But one of the best benefits is situations like the one described above. In this case, an employee in another area may be called in to cashier for an hour to help handle the rush. Or a cashier could be moved outside to help get the carts staged faster, etc. However, this is not a cure-all, as the peak periods inside are also often the peak periods outside as well. Lessons At SCC, all the assistant pros are required to participate in clinics and camps. They are certainly encouraged to perform private lessons. Given that teaching is part of the PGA program for its pros, this requirement makes sense if your desire is to have all your managers be PGA professionals. More on this later. It is traditional in golf to allow the PGA staff to give private lessons. Most facilities, including SCC require these lessons be given outside of scheduled work time for the course (on the personal time). This “extra” income is really to the benefit of the club, because it provides a higher level of compensation, which allows them to attract a higher quality employee, without the compensation coming out of their own pocket. At SCC, this not only has allowed the facility to attract an outstanding professional staff, but it has led to the development of a major profit center in the Academy. There was concern expressed to us that the pros were spending too much time teaching and not working their scheduled 40 hours. We investigated this matter thoroughly, examining both the pros’ work schedule and lesson load. We saw no evidence of this. What we did see is pros routinely putting in 60-hour work weeks or more, so that they can accomplish both their obligations to the club and to their private clients. While I have no doubt that SCC is getting their 40 hours plus from each of the pros, I do have a few concerns. First, while there is no doubt SCC is getting the time in, scheduling may be an issue. Pros are given wide discretion as to the scheduling of their private activities. This can lead to conflicts, such as mentioned above where the facility could use the Assistants behind the counter during the rush periods instead of paying cashiers to work six hours when one of them may only be needed for two. I would like to see better control of the scheduling of these lessons and the time the pros are “on- duty” at the club. Second, not all PGA pros are good at teaching. By making this requirement, you may be hurting both the pro and the customers who they are teaching. It is hard to be a good teacher if your heart isn’t in to it as teaching requires great patience and understanding.

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Nor do we feel it is necessary to have a “PGA” professional for all the manager positions. They do make for a ready pool of qualified people to step into the management role. But their greatest appeal may be that they are willing to work for much lower wages than another manager, because they can make it up in lesson revenue. As such, it may be more difficult to find non-PGA members who are up for the jobs, qualified, motivated and willing to accept the wages offered. On the other hand, it is not impossible. For example, if one of the assistant pros turns out to not be a suitable candidate for the PGA program – perhaps because they either do not like to teach or are not good at it, then don’t make them teach. If they are ok with the reduced compensation, so be it. Both the employee and the customer will be happier. Rangers Another area where there may be potential efficiencies gained is with the rangers. Currently, rangers are there from start to finish on both courses to help promote a faster pace of play. The issue is that SCC has GPS in its carts. This enables the people in the proshop to monitor the pace of play quite effectively from the clubhouse. Of course, you still need a ranger to help encourage the players who are slowing down the pace to pick the pace up. The point is that during large parts of the day, one ranger may be sufficient for all 27 holes, if the proshop is monitoring play because the ranger can then be dispatched just where they are needed, rather than patrolling the entire course. It should be noted that already only one ranger is being utilized to cover all 27 holes on Mondays and Wednesdays, where the volume is less. The problem is that the pace is not always being monitored in the proshop. Making it a bigger point of emphasis would help. We are also struck by the fact that there are only two POS stations at the counter. Mainly because that is all the counter can hold. But there is a third station that is not utilized as a POS. One complaint we heard is that cashiers need to work three different operating systems – the POS, one for the range cards and another one for lessons. This means switching back and forth between programs, which can take time and thus slow down the check-in process. A possible solution would be during the busy times, have the third station set up to take the range and lessons so the POS stations are reserved for golf and merchandise. One of the staffers would be dedicated to this station, which would also be the station monitoring the pace of play (It should be noted, however, that we are recommending a new counter be installed with three POS stations). Recruiting Even with the potential of sizeable lesson income, it is becoming harder and harder to attract and retain quality PGA Professionals. This can largely be attributed to the seasonal nature of the business in Chicago and the fact these professionals are seeking benefits. Only one of the PGA Assistants is currently salaried full-time with benefits. The other two are seasonal. Which means two things. One, they get no benefits. Two, for four to six months a year, they are unemployed.

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As it is currently set-up, it would be extremely difficult to justify adding another full-time position with benefits, especially since the benefits can end up costing almost as much as the wages. Thus, the dilemma. There are a few workable solutions, however. The first would be to make SCC into a 12-month facility. Our renovation plans, which include indoor training areas and heated/covered stall would do this. Another possibility that we have seen many municipalities do, is to utilize these employees to work in a different area where the season runs opposite of golf, such as ice hockey or an ice rink. This allows the system to retain a high-quality employee. A third option, which is much harder to pull off, is to work with another golf facility in a different part of the country that has the opposite golf season, such as Florida or Arizona. The pro will work six months in Chicago and then six months at a course in Florida or Arizona. One way to find such pros would be to advertise in PGA publications or online with the PGA sections in those areas. The problem, though, is housing. SCC is in a very expensive area, where finding housing for six months would be difficult to find anywhere close. If suitable housing could be worked out in advance, this might be a viable option. Customer Service SCC prides itself on its customer service. Yet, the customer surveys suggest that the service level at SCC may lag that of its competitors. Where is the problem? One possibility is that regulars and non-regulars are treated differentially. There is no doubt that regulars are heavily catered to. They are greeted by name. Staff will occasionally pick them up or take them to their cars, if they are elderly or handicapped. They will have a cart waiting for them on the 10th tee if they walk the first nine then ride the back. For these customers, SCC truly feels like the “country club” its name implies. But there are great dangers in this. The first is with the customers and the second with the staff. “Members” tend to take ownership of a facility, whether or not they are actual owners (such as in an equity club). This is a problem, especially at a public facility. Because, as “owners’ they tend to think the rules don’t apply to them. Moreover, they want “exclusivity.” In other words, they do not want to share the course with others who may slow down their play or take away their preferred teetime. This can create a hostile environment where non-regulars are clearly made to feel unwelcome by other customers. This same thing can happen to the staff. They are so used to catering to the regulars, that they may do so to the detriment of the non-regular. We witnessed this in person. Before we were hired, we visited the facility as “customers”. No one there knew us or even knew we were coming. We happened to come at a slow time. When we approached the counter, the person behind the counter was engaged in a friendly conversation with a regular. The business with the regular had been concluded. However, the staffer did not recognize our presence nor

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Golf Operations Assessment Operations attend to us until that conversation was completed, which seemed like a long time to us (It probably was not more than a minute or two, but when you are waiting to be recognized, it can be extremely frustrating). The course survey and our observations both strongly suggest that SCC has difficulty in attracting golfers from outside the immediate area. If these golfers are not made to feel welcome and wanted, it makes it extremely hard to get them to come back. It is also true that customer service is only as good as the employee providing it. One bad apple can ruin the reputation for the entire course. There is little doubt that this has also occurred. Demographics We would encourage trying to hire a more demographically diverse staff, one that best represents your community and desired market. For example, Northbrook has a high Asian population, that continues to expand, but we did not see a single Asian on staff. Nor did we see many women on staff (very few, in fact). We would really love to see the Academy, at the very least, have an LPGA member included on their staff. Unfortunately, this is not easy as we understand that there are actually very few LPGC members in the area and that they are in high demand, so their absence at SCC is understandable. But hopefully, this will be a priority and improved facilities may make the recruitment easier. Teaching Revenue Another assessment priority we were given by NPD management and Commissioners, was to determine if the compensation to the pros for teaching private lessons was in line with industry and area standards. The basic split employed by SCC is to give the pro 70% of the lesson fee, and retain 30%. Clinics and camps are handled differently, where the pro is given a fixed amount based on their professional standing and experience. It works out to a much larger split for SCC. Nationally, the most common split we see is 80/20, where the club retains 20%. However, in a sizable percentage of clubs, the pro retains 100% of the revenue. But these are typically clubs where the demand is much less. We did survey area clubs on this issue. Almost all of them use the 80/20 split. There were a couple of clubs where the club retains 100% of the revenue, making the lessons a regular part of the employment. We would not recommend an analogous situation with SCC, unless it was to hire a teaching professional whose only duties was teaching. Yet even in this situation, it usually works out better for the operation to do it as a split as it provides the strongest motivation to the pro while keeping the operating costs to a minimum. With a 70/30 split, SCC is certainly not overpaying its pros. Indeed, its split is the least generous of any club surveyed. But because it has such an outstanding program that brings in a lot of business, the split seems to work for both parties. If, down the road, a better split is needed to attract high quality professionals, than

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Golf Operations Assessment Operations consideration can be given to going 75/25 or eventually 80/20, especially for contract pros that are not on the staff. But this does not appear to be the case at present (Although, an exception might need to be made for unusual circumstances, such as to attract an LPGA professional, which we consider to be a very important addition). We also recommend a relaxing of the 40% margin requirement for group instruction when these are being conducted by an outside contractor (teaching professional). The mission should be to provide the best value – quality instruction at a fair price. Requiring a high margin in some cases could mean having to charge a price that is out of line with the competition, or using less-qualified contract pros. Management The golf management team at SCC is outstanding. But we do have an organizational issue. A successful business requires good, strong leadership. The problem is the organizational structure makes that impossible at SCC. This is because there are four different managers in control over various aspects of the operation, and three of them have no golf experience or expertise. The Director of Golf (DOG) is the title head of the Golf Division. Yet he has no control over three aspects of the operation. Food and Beverage is contracted out to a vendor. The DOG has no authority over its employees or its operation, other than to suggest changes through the vendor’s management. Similarly, the mechanic reports to Fleet Services at NPD, not to the Course Superintendent. The Facility Manager, responsible for all repairs, reports to NPD’s Facility Manager. Both positions are not only responsible for key aspects of the golf operation, their salaries are taken out of the Golf Division’s budget, yet the Golf Division has no direct authority over these employees. Such a structure is awkward at best and can be highly detrimental at worst. Because it places some key aspects of the Golf Division’s success in the hands of people who have no obvious loyalty to that division, little or no experience in golf operations, and whose priorities may not be in the best interest of Golf Division. That its working for the most part now, is testament not to how its set up, but to the individuals in place. Should these individuals change, it could create bigger issues. It certainly is not how a good business would operate – and SCC is a business, further, it is a business operating in a highly competitive field. And as we stated at the beginning, the more that profitability is a concern, the more the operation needs to operate like a business and not like a government entity. Another issue is the sheer number of supervisors. There were five assistant professionals who have supervisory duty at some level at the time of our site visit (this has since been reduced to four). Only one of them is full-time salaried. The others are seasonal.

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The question was raised as to whether it would be better to reduce the number of assistants in favor of creating more full-time positions. In other words, have two full-time Assistant Pros, each with more responsibility than is currently the case. An argument can be made for both. Creating a 2nd full-time position, with benefits, would allow the operation to recruit and retain a potentially higher quality, more qualified (experienced) pro who potentially could add more to the organization. The added cost for the off-season hours and costly benefits would be made up in part by eliminating several of the other assistant positions. Lower cost hourly help could be hired to replace needed hours of coverage in the proshop or outside services. Perhaps the area affected the most by this would be the Academy, which heavily relies on the assistant pros for its camps and clinics, as well as outside lessons. But this need may be met by hiring a teaching-only professional, preferably on a contract basis, as well as developing specialized non-professional staff to help with summer camps. The latter may be the most difficult task. From an operations standpoint, we are in favor of the move. It will reduce staff turn-over in the Assistant pro position and should lead to higher quality service, and likely better supervision of staff. Consideration should be given to hiring a camp supervisor who’s only job will be to manage the summer camps. This does not need to be a PGA professional. The remaining professional staff, along with the added teaching professionals, should be able to provide the expertise needed for the actual training provided during these camps, perhaps on a rotating basis. Consider as well, elevating some of the more experienced non-professional staff to “supervisory” status. This can help with mundane matters such as scheduling, as well as provide better supervision. Rangers and Starters Rangers were singled out by multiple respondents to our survey. They complained mostly about them “not doing their jobs” in maintaining the pace of play. But some of them also complained about the friendliness of the rangers. Pace of play issues are often a result of a course being very busy. As such, it is a good problem to have. Rare is it that you do not find customer complaining about the pace of play, especially if the facility is doing a decent amount of business. We found the level of complaints about pace to be far fewer at SCC than we find at other facilities. In short, we do not think pace is a major problem at SCC. But it does bring up the issue of rangers. Is there only job to enforce a stringent pace of play? The answer should be no. Their primary job should be promoting excellent customer service. They should be doing whatever they and to improve each player’s overall golf experience. They should be greeting every golfer with a friendly greeting, each time around. We would encourage them to carry cold water to offer golfers. Note: as there were very few comments about rangers other than in relation to pace, we have no reason to believe they are not friendly. On the other hand, we did not get any positive comments either, suggesting that perhaps they are neutral, putting the emphasis on maintaining pace.

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They should look for opportunities to provide memorable service. Examples of this would be helping golfers find their lost ball, and if it can’t be found quickly, flipping them a good quality used ball to take its place. This will create a lasting positive impression and costs nothing to provide as “used” balls are plentiful on the course. Another thing rangers can do during slower periods is helping fix divots and ballmarks. We received numerous complaints about ballmarks on the greens and traps not being raked, which are the responsibility of the golfer to fix. However, a lot of golfers either do not know this or choose not to do it. In either case, it makes it less appealing to the golfers that follow. Rangers should be trained to assist in fixing ball marks and traps, to help make the playing experience better for all players. Not My Job We mentioned earlier about the idea of cross-training. One thing we did observe on a repeated basis was a prevalent attitude that if something was not in that person’s specific job description, they were not going to have anything to do with it. A great example of this can be seen in the picture on the right. There is clearly trash on top of the table and underneath it. There was other trash around that is not visible. This was after an event in the morning. Here’s is the issue. I held staff interviews all afternoon on this patio. I probably had 20 staffers total outside with me sitting in the table next to the table shown here. This included two of the Assistant Pros. I kept waiting to see someone go over and get rid of the trash (I had to control my own urge to do so). Instead, it was completely ignored by everyone. I find this inexcusable. Staff should be trained to take pride in both their work and their facility. This means if they see something wrong, they try to fix it. Whether it means doing it themselves or simply bringing it to the attention of the person who is supposed to take care of it. The trash is just an example. We saw evidence of this attitude in lots of other areas with both the hourly workers and management. About two hours after my meetings concluded, a couple of staffers came to put up the temporary tables and chairs. They also picked up the trash. But why the tables were left to sit out all day, which is unsightly, is unknown and a concern. Permanent Teetimes Permanent teetimes are a fixture with northern Chicago area courses. It would be difficult to get rid of them entirely. However, there are good and bad things that come with such a program.

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The good is that you have guaranteed players that have prepaid for their times for the entire season. And these players are typically loyal. Here’s the bad. First, as with a membership program, the preferred teetime players tend to adopt an “ownership” attitude. This is especially true when it comes to pace of play. They get very upset if they can’t go around unimpeded. Yet the actual pace for these players is probably better than for any other busy time. And, as with “members” the permanent teetime customers can act disdainful towards the general public players, because they do not want them interfering with their teetime or their play. Staff too, can get into the habit of treating these people differentially. After all, they see them every week at the same time. And as we discussed above, this can be problematic. But there are other issues specific to permanent teetimes. The first is that, by nature, it is locking out the opportunity for anyone else to be able to play the course during these preferred teetimes. Think about it. If you just moved into the Northbrook Park District, and you’re paying your taxes, how are you going to feel being told that you may never be able to play at a preferred time at the course in your own district? This happens because the current teetime players are given the chance to renew their time at the end of the season. Further, current policy is that players can lock in their current times the following year. This means you are not only locking out everyone else, but the players will always be playing behind or ahead of the same groups. This is not always optimal if one group is notably faster than the other. It can get frustrating if week after week, year after year, you are always waiting on the same people. Tempers can easily start to flare. Finally, there is this. These teetimes are not only the most in demand, but they are the highest yielding. Or they would be, if they were open to the general public. The non-resident rack rate is $73. However, these players use the resident card and the preferred player program (for carts), which effectively reduces the rate to $42.88, or $30 less. With 160 players, this amounts to an “opportunity cost” of $96,000. But because they pay an additional $16,000 in fees to hold the times, the actual difference is $80,000. We would not eliminate the program, but we do recommend a few changes: 1. Lottery: Let chance determine when the player’s teetime will be. Residents should not be told that they may never be able to get the time they want. 2. Add Open Teetimes: Do not let the permanent teetimes take up an entire block of three to four hours on weekend mornings. Instead, have every three or four teetimes be “open” where players can book online a week out, as with every other time. It may be possible to charge a higher rate for these open times as they will be in such demand. 3. Raise Fees: Recommend charging a flat fee of $150 to participate in the program. This will help make up for the lowered yield you are getting for these premium times that you would likely get if they were not there.

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While these changes may upset some of the regulars, it is important, as an operator, to take a broader view and not let “the tail wag the dog.” When it comes down to it, the risk of losing a handful of regulars is more than balanced out by potentially gaining hundreds of more players (customers) and generating greater revenue, that in turn, allows the operator to continue to make improvements that benefit everyone. (And the reality is, you probably won’t lose many, if any. They will complain. But few will leave). Carts We have already commented on the poor cart barn conditions. Carts go in clean, and come out dirty. This creates work inefficiency as the carts essentially have to be cleaned twice. The distance from the clubhouse also adds service time. Quality The current cart fleet is eight years old. This is very old for ANY golf facility and unheard of with a “Premium” facility. We have never seen such poor ratings, or as many negative comments towards carts as we saw at SCC from customers. Most Premium facilities will turn over their cart fleet every three years, some will stretch it to four. We are unaware of any that go beyond four years. While we understand a new fleet is being ordered for next year, we strongly recommend that the fleet be turned over every four years. These are not like pieces of maintenance equipment, where the only issue is cost-effectiveness. These are used by customers and are part of the overall experience for the customer. It does matter. Cart Quantity Currently, SCC has 85 golf carts. A typical 27-hole golf course has 108 carts, allowing two per hole to accommodate maximum load (especially for tournaments). However, given the high percentage of walkers at SCC, a smaller number can be justified. We understand the average for the area for a 27-hole facility is 97.5 carts. We recommend a minimum of 95, given you need some for rangers and for back-up. Parking Lot Current policy is to not allow carts into the parking lot. This was done in an abundance of care due to concerns about increased liability. However, the Risk Department did not say “don’t do it”, they just advised of the increased risk. We found several area golf courses that had as narrow, or even narrower space between rows of cars. They all allowed carts into the parking lot. The ultimate answer would be a new parking lot. But this is an extreme solution if this is the only issue being addressed. (We do recommend a redesigned parking lot if a new clubhouse is built).

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Our recommendation is to rescind this practice, or at least heavily modify it (perhaps by time of day). Although it would be hard to police if they are allowed some days and not others. A side benefit of this could be the reduction of the number of cart staff during the slow periods, when one person could man the bag drop. We are not recommending discontinuing this service. Also, as noted previously, our recommendation would be to build a cart path down the left side of the entry road (in the grassy area), with a parking area by the range. This would allow golfers to easily go from the clubhouse to the range, with their clubs, and thus increase range revenue. Teetimes Currently, SCC uses a 9-minute interval for all its teetimes on both courses. This seems to be working well as it has kept the pace moving, improving customer satisfaction. Nationally, perhaps the most prevalent teetime interval is to alternate 7 and 8 minutes. This allows a lot more players to start within a 4-hour period. The difference is significant. With a 7/8-minute arrangement, you can get 32 teetimes in a 4-hour stretch (peak time). With four golfers per teetime, this equals 128 golfers. With a 9-minute interval, you get 26 2/3rds slots, or 106 golfers – or about 20% less revenue. However, there is a big cost to this in terms of slowing down the pace of play. When the course is so tightly packed, the pace will naturally slow down significantly, which will lead to much greater customer dissatisfaction However, there may be a third option. Typically, the golfers that go off first do so because they want to go around as fast as possible. Thus, these golfers tend to be faster players. It may be possible, therefore, to start with a shorter interval, either 7/8 or straight 8, for the first two hours, then convert to the current 9. This would add up to three more teetimes, or 12 more golfers. At $60 each total revenue, it could add as much as $720/day. At the very least, it is worth experimenting with for a period to see how much it adversely affects pace, if at all. Then decide as to whether to continue. Fees Based on the surveys and other customer feedback, it would not seem that fees are a main issue. The amount of complaints is not as high as we normally see. That being said, it also appears that at its current quality level, the Classic 18 and especially the East 9, are a bit overpriced. However, as conditions and service continue to improve, we are reluctant to make major changes for the Classic 18. We would, though, suggest a lower price structure for the East 9. The current pricing for the East 9 uses the traditional formula in golf where nine- hole play is priced at 55% of the 18-hole price. And this would be appropriate for

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Golf Operations Assessment Operations pricing for 9-holes played on the Classic 18. But the East 9 course is NOT the Classic 18. It appeals to an entirely different market, and its overall quality is not at the same level. The East 9 is currently priced more than the other 9-hole courses studied. Our recommendation is to adopt the Village Links nine-hole course rates, which are about $2 less rack rate. At the same time, we would raise the price of 9-hole play on the Classic 18 to 60% of the 18-hole fee. This will create a clear distinction between the two courses. In our opinion, the Classic 18 is not being utilized enough for 9-hole play. As noted, the Classic 18 and East 9 course’s market are clearly different. The East 9’s market tends to be oriented more towards higher-handicap players and players who enjoy shorter, and more playable courses. But there are times when lower handicap players and others who would normally prefer the higher quality courses, such as the Classic 18, but do not have the time to play 18 holes. These people are not being readily accommodated as SCC pushes virtually all nine-hole play onto the East 9 course. While it may not be feasible to book 9-hole teetimes on the Classic 18, it is often relatively easy to squeeze in nine-hole players in all but the busiest times. We would encourage letting customers know that this can be done, online, on the phone and when they come in. This way you are clearly establishing a price differential between the two courses. Preferred Player Program The preferred player program has been successful. And does represent a viable alternative to an annual pass. However, we feel that the “bonus” amounts being paid is too generous. Currently, the program incentives range from 20% with a $500 investment, to 50% with a $1,250 investment. We could find only two other local courses offering similar programs, Palatine Hills and Village Greens of Woodridge. At Palatine Hills, the incentives run from 10% with a minimum $725 investment to 24% at $1,250. Village Greens’ program runs from 20% at $850, to a maximum of 40% at $1,850. We recommend that SCC’s program starts with 10% at $500 then go to a maximum of 40% with a $1,500 investment. Female Friendly We noted in the competitive section that both courses at SCC are “unfriendly” to women players due to their length. We also pointed out that this was a general problem in the area. In fact, with all things considered, SCC does a better job than most area facilities in making women more comfortable, which includes more women’s items in the proshop than typically seen.

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But please notice that we said “better” and not “good.” The golf industry has long ignored, if not discouraged women players. And last time I checked, that’s half the population. It’s time we, as an industry, change. And SCC could become a leader in this area and dominate the local market. There is no area that represents a larger potential for revenue. What needs to be done The first, and most crucial step, is to add new forward tees to both courses so that women are playing an equivalent game as the men. This will make it more fun and enjoyable for them, and improve the pace of play for all. But women, perhaps more than men, are sensitive to all aspects of the experience. For example: • Customer Service: make sure that women are not being treated differentially. We were told a story by one female customer who was buying a piece of merchandise. The person at the counter asked if she had a teetime, when she said no, she was asked to wait so he could handle the golfers. This is one sure way to make sure a customer will never return. • Staff: As noted above, customers like to see staff that resemble themselves. More women staff members will equal more women players. • Merchandise: It may be a stereotype, but it is a true one. There is a reason that department stores will devote an entire floor to women’s goods and a tiny corner to men’s. Yet in a typical proshop, the situation is reversed. Most of the goods you see are men’s and a tiny corner reserved for women’s goods. How do you think this makes them feel? As a group, women do buy more than men. Expanding the merchandise line will not only make them feel more welcome, but will often lead to better overall merchandise sales. • Food and Beverage: East 9 restroom. Note bare concrete floor, lack of Women also tend to be features, poor aesthetics more social than men. Lunch is typically a big part of a golf day. The F&B environment at SCC is horrendous, not just for women but for everyone. But it may affect women

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players the most. Moreover, menu selection is critical. There needs to be a wide selection of “healthier” foods, salads and fruits available. • Bathrooms: Bathrooms are more important to women than to men. But at SCC their facilities are not equal. Moreover, the on-course restrooms are substandard for the price range. (At least they are not port-a-potties!).

Food & Beverage This operation is substandard in most every way. In addition to the horrible facilities, we have heard numerous complaints about both the quality and service. From the vendor’s perspective, there is little incentive to improve as they are not generating much income ($3 per round, or about $180,000/year in gross revenue). But it does not seem to us that they are making the effort to improve, either. The Opportunity We see a tremendous opportunity for Food and Beverage at SCC. Because of its excellent location off a major street and across from a large office park, there is an outstanding restaurant opportunity apart from golf. On the golf side, in the price range of SCC, the food and beverage operation should be generating over $10/round. Yet, SCC is falling well short of that, instead generating about as much as would be expected at a value facility. Of course, the main reason for this is the “concession stand” operation in the clubhouse. Not only does it look like a concession stand, its being operated that way. Both the NPD (clubhouse) and the vendor share the blame in this. From an operator’s standpoint, just because the building has service windows does not mean you must use them as concession windows. You could still offer table service. You see this in many restaurants. For F&B to reach its potential will require a new clubhouse. But as Chevy Chase and others have demonstrated, with the right facilities, the F&B operation can outperform the golf. We see this potential at SCC. From an operator’s perspective, it is always best to have the entire operation under a single management entity. However, we understand the impracticality of that in the current situation. Should a new clubhouse be built, though, it might be a good opportunity to bring the F&B operation in-house. What can be done Now? It may take years for a new clubhouse to be built. But there are many things that can be done now that would make a tremendous difference, with minimal investment. • Build a Bar: There is no reason why a bar could not be built around where the current concession windows are located. The windows would be replaced

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by a door going from the kitchen area into the bar/service area. The bar would feature a counter with bar stools around it. • Table Service: Table service should be offered during all peak demand times. At slow times, customers could be serviced at the bar. Customer service needs to be emphasized. • Beverage Cart: Just because there is a halfway house does not mean you should do away with a beverage cart. They serve two different purposes. The halfway house is more for food, while the beverage cart, as the name implies, is beverage-oriented. Furthermore, the East 9 does not have access to the halfway house, so it has no F&B service at all. The beverage cart should not be looked at as a “profit” center, but as a customer service. It enhances the experience. But it also should become a good profit center as well, generating at least $4/round if operated properly with the right personnel. SCC should require this service be provided by the vendor seven days a week, with hours starting 1 ½ hours after the start of play. (Another possibility would be to exclude the beverage cart service from the F&B contract with the golf operations taking over this service.) • Menu: The menu needs to include a wide selection of healthy choices as noted above. It helps to have “signature” items and daily specials. • Quality: It goes without saying that the vendor needs to offer high-quality foods Merchandise Sales SCC does a respectable job in merchandise sales, especially with “hard” goods such as equipment, balls, etc. However, there is still a lot of room for improvement. Physical Improvements One of the big issues is the physical space. The proshop has a very crowded appearance, and as pointed out before, the counter is intimidating. We recommend: • Counter: Get rid of the current counter and replace it with a nicer one that has a lower height. The counter should be set up for three POS stations to help with flow during peak times. Our recommendation would be to put the counter in the southeast corner, with a view out towards both the staging area and first tee. • Hallway: We recommend tearing down the wall separating the proshop from the hallway where merchandise is crammed in. It will make the proshop feel less crowded and provide sight lines for staff to cover the entire merchandise area. • Floorspace: Make sure the displays are organized to leave wide pathways through the display area and especially from the doors to the counters. You do not want to have a “crowded” feel. This may require some new displays.

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Logo Clothing is a highly competitive business. It is hard to compete price-wise or even selection wise with mainstream clothing sellers, especially the discount ones. The one advantage a golf shop has it that is sells something no other clothing outlet has and that is merchandise with its logo on it. But for this to make it worthwhile, the logo must be appealing, especially when it’s on a shirt. SCC currently has NO logoed shirts for sale and only a few caps. The reason for this is the logo the golf operation is required to use. This logo is designed to feature the Park District and to be consistent with the logos of other departments. What it is not designed to do is sell shirts. This is a huge opportunity lost. A Premium facility, such as SCC, should be able to make $4 to $5 a round on golf shirts alone. SCC is making a fraction of that ($1.58). A new logo should be designed such that it looks good on merchandise, especially shirts, but also balls, caps, etc. A new logo would be required should the facility be rebranded as part of the renovations. However, as that is likely several years in the future, we strongly recommend a new logo be designed NOW so that SCC can take advantage of stronger logoed merchandise sales. Strategy The most successful merchandise sellers among golf proshops, are those that fully understand and embrace the fact that the proshop is a retail store, and as such, needs to adopt retail store strategies. Below are some suggestions: • Sales: Few people enjoy paying full price. Most are naturally attracted to Sales items. Retail stores understand this and will always have quality merchandise on sale. Most proshops do not. They reserve “sales” for clearance items that could not be sold at regular price. The best strategy is to: o Always have quality merchandise on sale. o Regularly rotate items in and out of the “sale” category. o Have items “on sale” for no more than two weeks at a time. o Consider “theme” sales, such as having everything “Titleist” on sale, including equipment, balls, clothes, etc. o Promote ▪ Have prominent sales signs on the displays. ▪ Place advertisements on the GPS systems in the carts. ▪ Have signs promoting the sale throughout the clubhouse, including table signs in the dining area, and signs in the bathrooms, etc.

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▪ Advertise the sale on the website. ▪ Email promotions to your database. • Selection: Add more women’s goods, as noted above. • Incentives: At one time, staff were given incentives for selling merchandise. Consider bringing this back. Incentives work! • PGA Pros: Take more advantage of the fact you have PGA pros to help with club selection – one thing you will not find on line or at the golf discounters. Give the pros incentives to sell the merchandise and they will likely do so, especially to their lesson and clinic clients. The best operations during busy times will have their PGA professionals not behind the counter, where an hourly cashier can do the same job, but in front of the counter¸ working the sales floor where they can assist customers and provide them with professional advice. Marketing There is no doubt that marketing is the weakest aspect of the golf operation. It is almost non-existent. Yet our experience tells us that there is no other investment you can make that is more highly correlated with revenue. The days of “if you build it, they will come” in the golf industry are long over. Even if you spend millions in improvements, if you don’t tell people about them, they may not have the desired impact. But don’t wait until the improvements to market! If you want more revenue now than you need to market now. SCC has taken a major step this year in this direction through aligning with Golf Now. But there is a lot more that can be done. As we have pointed out, SCC, especially, needs to expand its customer base. This is most easily done by making people aware of the opportunity at SCC. SCC may have to work harder at this than other facilities. There are two reasons for this: • Name: As pointed out, “Sportsman’s Country Club” is not an inviting name for many reasons. • Reputation: Based on interviews with staff and customers, and reading online comments, SCC suffers from a poor reputation in the area. This is largely due to the conditions of the course some five years ago. But bad reputations are hard to overcome. The best way is fix the problems, which SCC has gone a long way towards doing, and then telling people its fixed (by showing new pictures of the pristine conditions, etc.).

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Budget The recommended budget for a public golf course is to invest 3% of the gross revenue into marketing. Based on the past five year’s revenue stream, this would work out to be $78,000 a year. Last year, the Golf Division spent $2,300. NPD Marketing Department NPD has a very good marketing department, which SCC utilizes. However, it is not clear that golf is being given a very high priority within this department. It may also be the case that the Golf Division is not taking full advantage of the services the Marketing Department has to offer – such as a social networking expert. We also see evidence of poor communications between the Golf Division and the Marketing Department. We encourage regular meetings, at least on a monthly basis, between the Marketing Department and the Golf Division senior management. During these meetings, the Golf Division can go over its schedule and needs and the Marketing Department can help develop strategies and materials. From our perspective, the NPD Marketing Department should be seen as a good, discount vendor. If the quality and service is there, then by all means use it. However, the most important thing is to get the message out to the customers in the most cost-effective and timely manner. If this means using outside services, then that’s what should be done. Website Marketing in today’s market, starts with the website. This is where golfers will first turn. SCC’s website is decent, but there are improvements that need to be made: • “Searchability”: A website is only good if people can find it. If you are specifically searching for Sportsman’s, you will find it, or if you’re searching for “Northbrook Golf” it will pop up. But what about golfers searching for golf courses in nearby communities? Sportsman’s is nowhere to be found. Given how close SCC (and AGC) is to these communities, this is an opportunity lost. There are techniques that can be used to increase placement on “Google” and other search engines where searches for “Highland Park Golf” and other communities plus “golf” will have Sportsman’s turning up on the first or second page. You can even have your website appear when golfers are searching for your competition. • East 9: East 9 is much overlooked. In fact, when you click on “course info” only the Classic 18 appears. The Classic 18 and East 9 as well as AGC all appeal to different markets. It must be made a lot clearer that you have a product for these markets and give equal attention to them • Range: As the range is a major profit center it is surprising it is given little attention other than prices. We do like the fact that you promote rental clubs for the range.

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• Leagues: There is a page devoted to leagues, which is excellent. But it fails to provide any information about them or how to sign up other than to call or email. • “Click” Advertising: Search engines will give your website a priority if you are willing to pay a “click” charge based on number of people who “click” on your site following a search. One of the nice things about this service is that you can set a budget. Once that number of clicks is reached, the service is discontinued for the remainder of the month. Email Promotions SCC does a good job with email promotions. And this is certainly the most cost- effective way of reaching your current customers. The problem is that relying on this as your main marketing effort means you are doing nothing to bring new customers to the course. Social Networking Perhaps the best form of advertising in today’s market is through social networks. Not only do you need to maintain an active presence on these sites, with regular postings, but you should use their advertising power. These sites allow you to do target marketing to their vast audience. This can be extremely cost-effective. Anetsberger Anetsberger often seems like a forgotten step-child to the main operations at SCC. It is manned by part-time staff. Their supervisor, one of the Assistant Pros, visits the facility at most once a week. There is essentially no food or beverage operation at the course. They rely on two vending machines, one of which was just removed. Behind the counter, they have a few candy bars and a limited selection of Gatorade in a tiny refrigerator. They frequently run out of inventory and it can take a week or more to get it replaced as no one at the course, nor their immediate supervisor, has the authority to buy replacements. Anetsberger also is plagued by a high number of walk-ons. This was confirmed by everyone who works at the facility, as well as in our customer survey. That is, there are a sizeable number of people playing the facility without paying. There are several things that contribute to this problem including: • Location of the Clubhouse: From the current clubhouse, it is impossible to see the first tee. This not only hurts regarding control, but it is extremely operationally awkward. • Easy Access: It is very easy to walk onto the course from the road fronting it. You can park right on the curb, unload your clubs, and play. And you can’t be seen from the clubhouse. There is also an access point in the northwest corner that is frequently used by residents.

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• Hours: Because it’s a short course, it does not take long to play. With it opening at 8am, this leaves two or more hours of light in season when the course is easily accessible and no supervision. Only recently were the staff at the course provided a cart so that they can better police the course. Previously, even if a walk-on was spotted from the clubhouse, the distance made it difficult to address as it would require leaving the proshop unattended for a long time given the distance from the clubhouse to most of the course and having to walk and there is only one staff member on duty at a time. The course is also challenging to maintain. The equipment is being stored at the Parks Maintenance Building, which is remote from the course. Thus, a lot of time and fuel is spent moving the equipment to the course. There is also no place on site to store supplies and materials, such as sand. Thus, requiring the materials to be brought in from SCC on an as needed basis. This is both time-consuming and inefficient. And while it is a very short course and easy for most people to walk, the lack of golf carts eliminates some seniors, who require the carts to get around. The golf shop, in addition to managing the golf course, also manages the pond, which is open to the public for fishing. Fishing poles can be rented in the proshop, and bait can be purchased. The issue is that it has been difficult keeping fisherman in their designated areas. They want to go to the back of the pond, where they are very much in danger of being hit by golf balls. This is a significant safety concern. We have also heard complaints from consumers that there are very few rental sets available (three adult and nine junior). The issue is that there simply is nowhere to store more, as storage is extremely limited. This also makes it difficult to keep other merchandise stocked. And because of the clubhouse’s location, the staff are frequently asked about park activities or receive complaints about things that are happening at Techny Prairie Park and Fields. Yet the staff have very limited ability to help. Another issue that came up from staff is that their change drawer is not big enough, as they frequently run out of change. This is embarrassing and problematic since they have no way of getting more without leaving the facility unattended. Staff also complained that there are no shades in the clubhouse and that during some periods during the day, it becomes extremely difficult to see the computer screen. Recommendations • Modular Clubhouse: We recommend that a modular clubhouse be installed near the first tee, probably where the existing picnic area is (this could be moved to another location). A modular clubhouse can be leased, so the only capital expense would be the set-up, and the creation of a small deck around it. The total capital cost likely less than $25,000. The new clubhouse will not only reduce freeloaders, but will allow for more merchandise and especially food & beverage sales.

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• Repurpose Existing Proshop: Based on staff interviews, depending on what’s going on at the park, they can become besieged with customers wanting food and beverage, which they cannot supply. It would make sense, then, to consider making the proshop into a snack bar that would only be open during peak demand periods and special events. • Supervisor: There should be a seasonal full or at least 3/4th time person that is given supervisory status and is on site. The current set-up is ridiculous. This manager should have the ability to get inventory when needed. • Fence: We recommend a fence be built, at least along the southern border of the course, and possibly in the northwest corner. This may not eliminate walk-ons, but it will greatly discourage them and sometimes that’s all that is needed. • Flags: One possible solution to the before-hours free play is to simply pull the flags at the end of the day. However, there are a lot of senior members who are playing before hours, apparently with the blessings of staff. We find this disturbing as it is creating a potential for safety and liability given customers are accessing the facility without any supervision. • Carts: Consider having four carts available for customers to rent. This will likely require a storage building to be purchased and placed proximate to the clubhouse. However, the one cart currently being used is being stored at the opposite end of the park from the clubhouse. This, is very awkward for staff who must have to walk the considerable distance to get or return the cart. This is because of the long hours. A person who starts could park by the cart shed, but then would have to walk back to get his car at the end of the shift. The reverse is true for the evening shift. • Miniature Golf: We feel Anetsberger is the more logical place for the miniature golf course, especially given the number of juniors that utilize Techny Prairie Park and Fields. • NPD Education: Educate the staff at Anetsberger about what’s going on at the park, and provide park materials. They are going to be asked anyway, they might as well know what to say! • Make More of a Priority: In general, Anetsberger is being overlooked in every aspect, from management, to maintenance and in marketing. It is a nice facility that could get a lot more usage if it’s given a little more attention. • Foot Golf: We recommend exploring adding Foot Golf to the programming at AGC. Given the soccer fields at Techny Prairie Park and Fields, AGC has a natural market. While this is not likely to be a major revenue producer, it does fit in well with the mission statement and would add some revenue at a very low additional cost.

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Latent Golfers As we noted in the market section, there are actually a lot more latent golfers than actual golfers, especially in the local area. Latent golfers are those people who have expressed an interest in playing golf, but who currently do not play. The golf division at NPD, with its facilities and especially with the academy, is in a very strong position to convert the latent golfer to an actual golfer. In order to do this, we must first discuss why the latent golfer is not already a golfer. There are three primary reasons: 1) Cost, 2) Time and 3) Intimidation. We will discuss each in turn, as well as the strategy to overcome. Cost Cost may be the single most important factor. While golf is not a cheap endeavor, it is even more intimidating to start. Before one can play golf, you need to have the equipment and supplies. This includes a set of golf clubs, a bag, perhaps golf shoes, golf balls, tees, etc. Put together, these can cost anywhere from several hundred to well over a thousand dollars – and that is before you are even sure you like the sport. And then there is the cost to play – green fees, cart fees, etc. Plus, you have the cost to practice, range balls, etc. The best way to overcome this concern is to remove it as much as possible. • Provide low-cost rentals for players wanting to take up the game, keeping higher cost rentals available for the traveling golfer wanting a better experience. (SCC already does this on the range, but it needs to be done on the courses as well). • Develop beginner packages that may include a set of used clubs or inexpensive clubs and a bag, plus lessons and/or clinics, plus range balls, plus several rounds of discounted green and cart fees. Time Time is a much harder objection to overcome as you cannot manufacture time. However, promoting AGC, with its hour and a half rounds, and the East 9 with its two to two and a half hour rounds will certainly help. A lot of non-golfers simply are not aware that there are alternatives to the 4 ½ hour rounds they hear about. Intimidation Non-golfers can be easily intimidated by the difficulty of the game and the desire not to be embarrassed. Some of the latent golfer population are former golfers who gave up the sport mainly because it was too difficult and thus less enjoyable. Here, the academy can be your strongest resource. Promote beginner’s clinics. These clinics should be targeted to specific audiences, such as juniors, adults, women, and seniors. People are more comfortable when they are surrounded by peers. Again, make sure you provide the participants with the equipment during the lessons so that the cost barrier is dramatically reduced.

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Consider creating adult beginner’s league(s) at AGC and/or the East 9. Again, beginners are going to be more comfortable in a peer setting. Have pros participate in the league as roving instructors that provide on-site quick tips to help the players. But none of these strategies will work unless they are promoted, which brings us back to the issue of marketing. Awareness can also be created by going out into the community and speaking with large organizations, such as church groups, civic organizations and large employers, and let them know about your programming and be willing to set up special clinics just for them.

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Goals and Objectives At Sportsman’s, our charge is to support the Sirius Golf Advisors business study, which is seeking to create a more financially viable business model for Sportsman’s and Northbrook Park District moving forward. Our design brief was to propose changes that can logically and specifically demonstrate ability to improve economic results, by some combination of: ➢ Increase revenue by making the course more attractive overall and in the marketplace. ➢ Decrease costs without affecting the existing or proposed Market Position.

Sirius Golf Advisors will make a wider variety of proposals based on their total findings, and we may modify proposals in this preliminary report when considering other findings. Golf Course History Sportsman’s Country Club opened in 1931, originally called Sky Harbor Golf Course, and located just across Dundee Road and southwest of a commercial airport of the same name. Planned in the “Roaring 20’s,” by millionaire developer George L. Chamberlain, it opened in 1931, after unfavorable economic conditions began. It was a privately owned 36-hole facility, but open to the public. Old aerial photos show that the East 9 had been built previously. It features no bunkers, crude design with sharp banked grass mounds, a feature more typically associated with pre-1900 golf design in America. A possible similar grass feature is shown below (directly over the flag) at the famous Myopia Golf Club in Massachusetts, designed in 1894. The definitive history of golf architecture, “The Golf Course” by Cornish and Whitten, co-credited Sportsman’s design to Dearie and Abe Espinosa, who was the first Hispanic American to win a PGA Tournament, resided in Chicago as pro at Medinah (and other clubs) and is credited with at least one other design after his playing career. Even then, developers wanted “name value,” but it appears Dearie did the heavy lifting.

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According to a 2002 article in Golf Course Management Magazine, Dearie (profiled below in greater depth) was writing a series of articles for Golfdom magazine while building Sportsman’s. In one article, he provided some construction details, including: ➢ Moved 102,000 CY of earth (large by standards of the day, even for 27 holes)

➢ Irrigation cost $45,000.

➢ An 8” line was run over two miles to obtain a water supply

➢ It took only 91 days from turning earth to opening day!

➢ He included a photo of construction showing horses and mules doing the work:

Aerial photos from 1963 and 1977 show that Sportsman’s remained in essentially the same configuration. The current cart barn and former bowling alley appears to have been added prior to 1960, when it first shows up in an aerial view. By 1974, the maintenance on the soon to be sold west nine has declined, with many former sand bunkers filled in or grassed over. Sportsman’s Country Club was sold to a developer in the late 1970s. Local golfers organized to force a referendum, with citizens of Northbrook voting to allow the Park District to buy the course in 1978. The course remained largely intact, but the original 10th hole had to be converted to a par 3 due to property constraints, reducing par by one. Original Golf Course Architects “The Golf Course” states that Ed Dearie was an authority on golf course maintenance and construction. Dearie worked as a greens keeper all his adult life, and was a charter member of both the GCSAA and the Midwest Association of Greenkeepers. He wrote extensively on the construction and upkeep of golf courses for national periodicals, and was contracted by Golfdom Magazine to write a series of articles in 1930, at just as he was involved with Sportsman’s. According to those articles, he began his career as greenkeeper at Wanango Country Club, Reno, Pa., 1917. In 1921, Dearie moved to Chicago, apparently after first going to Los Angeles to “assist” Willie Watson on a California project. Watson was a Scottish pro/superintendent/architect who designed courses in Minnesota, Michigan, Chicago and California. My guess is Dearie secured that construction job as an off-season job before starting at Ridgemoor in the spring. He appears to have later served as construction supervisor for Watson’s design of South Shore CC in 1928.

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1938 aerial photo of Sportsman’s Country Club. The East 9 was out of character with the newer 27 holes right from the start!

In 1931, Dearie moved to become Superintendent of the Oak Park Country Club, where he stayed until retiring in 1951. Professionally he had made quite a side business of golf course design, but personally suffered much anguish. His son was among early landings on D-Day, and was soon killed in action. His wife died during an operation in 1945 at age 46. He died in 1952 at age 64, and was interred at All Saints Cemetery, Arlington Heights, Illinois.

He is reported to have worked for Donald Ross, but that link isn’t clear. Early on, historian Whitten thought Dearie built courses for Ross, but his original attribution

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Golf Operations Assessment Architect’s Report was based on verbal recollections of some “old timers in the Northeast.” The revised edition, “The Architects of Golf” omits this, finding no other verifiable link between the two. While they were in a few of the same places, it was never at the same time –

➢ Dearie worked at Wanango CC starting in 1917, but Ross designed that course in 1913 ➢ Ross remodeled Oak Park in 1914, 15 years before Dearie’s time there as superintendent. ➢ Dearie moved to Chicago in 1921 to work at Ridgemoor, o After Ross’ busiest period in Chicago (1907-1918), but, o Coincidental with Ross’ re-design of LaGrange CC.

The last is the most logical – and possibly only - connection between the two. Ross biographer Brad Klein devoted space in “Discovering Donald Ross” to Ross’ many associates, but Dearie isn’t mentioned. Ross had no employees in Chicago, and he used locals for construction. Dearie sometimes supervised construction, obviously allowed by his employers to “moonlight.” Dearie had a nice side business in architecture during the 1920s and 1930s. He built a dozen new courses and remodeled another dozen in the greater Chicago area. According to Whitten, these are courses designed, remodeled or extended by Edward B. Dearie:

California: Virginia CC, Long Beach (1921), assisted Willie Watson. Illinois: Big Oaks CC, Norwood Park (1923, NLE). Brae Loch G Cse, Grayslake (1928). Fort Sheridan GC, Fort Sheridan, Highwood (1923, NLE). La Grange CC, La Grange (R. 1926). Oak Park CC, Oak Park (R. 1936). Ridgemoor CC, Chicago (R.1 A.1 1936). Rob Roy GC, Prospect Heights (No. 1 and 2, 1930) St. Andrews G&CC, West Chicago (Lakewood/No. 2,1928). Sportsman’s CC, Northbrook (1931), with A. Espinosa Sportsman’s CC, Northbrook (East 9 1931, with A. Espinosa; A.9 1939, NLE)*. Sydney R. Marovitz GC {OKA Lincoln Park GC/LKA Waveland GC}, Chicago (9 1932), with A. Espinosa.

Whitten also credits Dearie with the later design of the East 9 in 1939, which doesn’t look probable. From the aerial photo depicted above, it seems the east nine remained largely intact until the 1990 redo. Not even knowing about his supposed Ross connection, his courses were always among my favorites in Chicago growing up. I felt his contouring of greens and surrounds exceeded that of the typical Ross course, probably due to more intensive

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Golf Operations Assessment Architect’s Report on-site supervision of mostly local projects. And, course quality is what has made Sportsman’s a success over the years. East 9 and Renovations by Other Golf Course Architects Soon after Northbrook Park District purchase of Sportsman’s, then head of golf operations Tim Miles brought in the firm of Killian and Nugent, who redesigned a few greens, installed safety nets on the range, and added drainage. The aerials show a gradual softening of bunker shapes and slopes, probably to reduce maintenance costs for the now municipal course. Their former employee, Bob Lohmann, later did more of the same, focusing mostly on drainage. The East 9 had been sold as a future school site, but bought back by the Park District in 1989. Golf course architect Roger Packard redesigned a primarily an east-west routing to a completely new north-south layout in1990. Like the Classic nines, the East 9 is also par 35, but is slightly shorter than either nine on the Classic 18. It is considered more of a family course, sporting forward tees for juniors. Stylistically, it isn’t a match for the Classic 18, and the “mounding” style popular from 1985-2000 has fallen out of favor, and looks too busy. In 2005, Northbrook Park District retained Jacobson Golf Course Design in Libertyville to restore the “Classic 18.” The routing remained largely the same as reconfigured in 1978, and Jacobson mimicked the original intent of Mr. Dearie’s designs, using the existing greens and many sand bunkers in the design. He converted some original fairway bunkers (now not affecting play) into grass hollows of similar design. Greens were replanted with a new variety of bent grass. However, budget constraints meant their sub base would remain an amended version of the old topsoil greens, rather than be re-constructed from the base up, which has caused some problems.

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Golf Course Renovation Basics As difficult as times may have been, other courses have had it worse. Many renovations occur after disaster strikes. Nationally, in any given year, about 1% of courses suffer substantial turf loss, usually attributable to extreme flooding or weather. Turf losses are rarely caused by construction or maintenance practices. Hundreds of courses must renovate quickly, while Sportsman’s merely wants to improve in an orderly fashion. While golf courses seem “natural,” like structures, they are constructed and require capital expenditure to maintain functional “status quo.” And, like structures, they begin slow deterioration (sometimes masked by maturing landscapes and turf) soon after the opening day! Ideally, course owners should start planning/saving for the next round of renovations almost immediately upon re-opening. The good news is, a 2014 Sirius Golf Advisors study (in DFW, so relevant here as much as anywhere) showed renovations are likely to significantly increase revenues, especially if accompanied with rebranding.

Renovation needs vary along the life of any golf course, taking one of many forms, including those required to: ➢ In early years, add landscape and signage, full paths and/or curbs, paved parking, permanent restrooms, maintenance or clubhouse, or other items left out of original construction for cost reasons. ➢ In the next 5-10 years, fix existing physical that deteriorates quickly due to use or construction quality, typically including replacing bunker sand, re- building practice tees, sodding spots of dead turf, correcting minor drainage problems, etc. as they occur. ➢ In years 15-30 Replace/Upgrade infrastructure to remain competitive, - Around year 15, you’ll notice irrigation, drainage, paths, etc. will start failing more often, requiring more and more crew time devoted to fixing the course over maintaining it. The need for capital investment is nearly a must, and if investment had been deferred, costs can get quite large. The old saying, “You can pay me now or pay me later” applies. Often, it is an appropriate time to pursue comprehensive renovations to fix all items at once.

Fixing your most critical problems, such as improving green surfaces, adding paths, improving bunkers, etc., tend to yield smaller revenue increases, but since they cost less, they tend to produce a higher rate of return.

➢ Transform the Course in the Marketplace – Since the 2007 recession, hotel, fast food, and restaurant chains businesses, have been upgrading designs at historic rates to attract and retain customers. Depending on schedules, we often find Fairfield Inn/Hamptons are now equal or better to their chains higher priced flagship hotels. New McDonald’s resemble coffee

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houses, Chevys have similar amenities to Cadillac, etc. And in golf, many of your nearby competitors have already rebuilt “a better mousetrap,” spurring other courses to “keep up with the Jones’.” Many courses change roles, with cities (like Northbrook) buying struggling former private clubs and converting them to public courses being a common transformation. Sometimes, courses find the opportunity to move up a niche in the public market by making dramatic, image changing renovations, hoping to reap revenue additions via round and price increases, etc. Substantially changing image and elevating a course usually involves total renovation, completed in one year. Sometimes re-naming and rebranding are part of the package. Transformation usually provides the biggest boost in revenues, assuming rational customer behavior, i.e., willingly paying somewhat more for a better, higher value product offering. Obviously, a good renovation can and should improve business, but it’s a more solid bet in a good golf market like Chicago. Current Course Condition Analysis – Classic 18 Any change starts with evaluating needs within in the context of: ➢ Basic performance goals, ➢ The state of the existing course ➢ The financial and artistic potential of future changes.

Golf courses have three main components: ➢ Routing – Sets the footprint. Flaws are permanent until re-routing occurs. ➢ Features – Creates the “look, feel, ambiance.” ➢ Infrastructure/Agronomy – Allows or detracts from the ability to maintain. We will examine each in turn. Routing Original routing sets the footprint, good or bad. Re-routing is expensive but is the only way to fix certain problems. We recommend it only to eliminate the “U” Holes - Unfair, “Undefined”, Unpopular, Unsafe, Unappealing. Fortunately, the routing at Sportsman’s is good, with many good holes and few “U” holes. The holes fit the naturally gentling rolling topography well, are playable by all types of golfers, have good visibility from tee to green, receptive landing zones, and close green to tee proximity (with some exceptions) that foster quick pace of play. The major routing issues at Sportsman's are: • Length/Par: Golfers still love par 72 and back tee yardage over 7,000 yards • Safety: A few holes and the range may conflict with surrounding land uses • Circulation/Speed of Play: par 3 hole at 10 slows play

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Major re-routing involves greater expense. Courses that renovate “in place” generally cost 20-35% less than renovations with substantial re-routing. Nonetheless, some problems can only be fixed by rerouting. At Sportsman's we need to first study if re-routing a portion of either course can help solve larger problems in the business model. Specifically, Sportsman’s has several additional issues:

➢ Range Location, and questions included: o Is it safe enough by today’s standards in its current location? o Can we attain a full-length range, with more amenities, i.e., short game area? ➢ Total Length is short ➢ East 9 is shorter yet. We examined three options: o Remain the Same, a somewhat substandard 9-hole course o Upgrade to equal Classic 18 to create a true 27-hole regulation course. o Downgrade to an executive course, allowing more room for other facilities: ▪ Longer Classic 18 ▪ Bigger, Full Length Range ▪ Short Game Area. ➢ Par is 35 for each nine, where 36 is preferred: o Can we lengthen any hole to raise par by one stroke? o If 3 equal nines, should we keep par for all at 35? (probably) ➢ Safety Concerns: Can we resolve other safety issues: o 10th hole Classic 18 too close to houses o 4 and 9 tees Classic 18 are dangerously close to previous greens o 13, 17 slice (to the right, where most golfers will miss to) is out-of- bounds (OB)

We will address these issues in order: Practice Facilities At Sportsman's, the driving range serves two distinct functions and groups: • Those warming up before golf • Those who just wish to practice. The current location near Dundee Road is convenient and encourages off the street, after work practice. It serves golfers playing the courses less conveniently. Other issues include: • Safety of surrounding areas, requiring nets • Visual distraction of nets • Management – it requires separate starter shack, shared with miniature golf • Too Short, Too Narrow • One artificial tee line, no grass tee

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• 33 stalls, each minimum width and slightly uncomfortable. • Poor lighting • East facing bothers morning golfers • Low Ambiance, feels like range is lower quality than golf course. The existing range is a key revenue producer. Junior programs and “off the street” patrons keep it busy much of the time. Bays are filled at peak times, and often busy, even weekday mornings (thanks to golf camps) and well into the evening on weeknights. Local golfers view the facility suitable or at least convenient, and their overall best range value. Driving ranges around Chicago appear to do great business. It logically follows that a larger range tee would yield additional revenues. Additional amenities might also improve performance. Adding capacity could be accomplished at the existing location in several ways by adding: ➢ Ground level stalls, from 33 to 45, by extending south through control building ➢ Extend Hours of use, via o Better night lighting o Covered Stalls for rain/cold weather o Extensive Lighting - Behind Tees, Side Lighting, Up lighting behind targets ➢ Adding a Second level, approximately doubling hitting bays to 60-70. ➢ Add convenient parking by realigning, adding parking both sides of entry road. ➢ Create a Turf Tee (60-80-yard-deep for maintenance) to attract serious practice players, but requiring more nets at end. The extension of the tee south can be accommodated by removing miniature golf. Being adjacent to Dundee Road causes potential safety conflicts. Shortly after Northbrook Park District took over the course, it installed nets on the north side, with wood poles, and sometime later, added taller metal pole nets along the parking lot. These nets are currently high enough to block normal shots of average golfers, but longer, higher ball flight allows stronger golfers to carry over the nets, reducing their total effectiveness. They have been improved since (especially the south side with its newer metal pole supported nets, and we are told the nets are about 75 feet high). But, even with nets, you are aware that some balls exit the range on both sides, but are unaware of exact numbers and have few reports of damage incidents. Still, you incur some legal liability, especially: • When errant shots commonly reach surrounding property, including residential, commercial, office and roads. The law (and common sense) presume people on adjacent properties are less aware of golfers and possible injury, and are probably less likely to see oncoming golf balls from distance. (One-time incidents, shouldn’t qualify as a noticeable pattern)

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• Your responsibility is to keep the “preponderance” of golf shots from causing harm. While legally vague, “Preponderance” probably implies 99+% of shots. • Your legal obligations/liabilities are less for golfers on your course, as the law presumes golfers know and take the risks inherent in golf to enjoy the game. • It is better to locate driving ranges within the interior of the golf course, where your liability is less, and because driving ranges amplify potential conflict due to sheer volume. Sportsman’s sells about 1,400,000 annual range balls, vs. any single hole seeing about 28,000 tee shots (with occasional mulligan) and similar amounts second shots, which tend to go less off line, or 25 to 50 times less opportunity for shots to go awry. We tried to roughly estimate how many range balls might find Dundee Road, using and interpolating data from various industry studies: • From TrajectoWare 1.0., shown below, it takes a swing speed of 96MPH and a 12-degree driver to exceed your net height.

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• The second graph is based on a 513-shot study sample by Dr. Brodie of Virginia Tech, showing landing spots and dispersion angles for tee shots of “D” players, making up 25-50% of public course players, with the statistically biggest dispersion pattern.

Combined, it is a rare combination of dispersion, height and distance carry that allows shots to clear the net, and travel an additional 40 to 80 yards to reach the first lane of Dundee Road to potentially strike the back of eastbound vehicle. Interpolating, about 0.1% had the combined characteristics to do that. Results from this brief sampling of shot scenarios suggest that Northbrook Park District reasonably meets the “preponderance” legal threshold. However, with 1,400,000 range balls per year, up to 700 hundred balls might find the road. Northbrook Park District is a “deep pocket,” so a lawsuit related to the range is certainly possible. And, while the northern most 4-5 tees at Sportsman’s pose the most significant risk of hitting the road, the southernmost are close behind, and if we pursue tee expansion south, we anticipate it will increase the problem slightly. If the range stays as it exists now, there are two ways to improve safety: • Use limited flight golf balls • Raise netting to 100-120 feet from 150-250 yards While your south side nets are newer and have metal poles, the north side along Dundee Rd. are older, with less attractive wooden poles. While not in immediate danger of coming down, they will have to be replaced at some point, and that might be a good outer time frame for replacing those nets with ones supported by metal poles at greater height. Wood poles max out at 72 ft. (maximum height of telephone poles) near the current height. A recent bid for netting was $225.00 per lineal foot, or about $3.00 sf which might be higher in Chicago given labor conditions. (25 ft. high fencing was $72 L.F., or $2.88 sf) We have not consulted any local codes for this report, which may affect maximum height and future maintenance. Bryn Mawr Country Club installed netting along North Crawford Avenue in May of 2017. They

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Golf Operations Assessment Architect’s Report planned for steel poles 50 feet on center, and 100-foot-high netting, but mid project, the City made them reduce height to 75 feet, presumably for visual reasons. At 100-foot-high, and 500 feet long, the winning bid was $180,000, or $3.60 per sf. Sportsman’s will require about 850 L.F. of net along Dundee Road, and could stand 250 L.F. more nets on both the back and south side, totaling a projected cost of $486,000 in 2017. If the range is expanded in place to the south, the south netting will require relocation or replacement, adding to cost, although some materials might be re-used. Other features cannot be accommodated well in its current location, suggesting we consider repositioning the range. For study purposes, we have enclosed two concepts for moving the range for reasons listed, including: • New Range occupying 18 Classic and 1 East, with re-routing • New Range occupying 18 Classic and 1 East, with further re-routing and re-numbering to create faster play. New Range Location at Holes 1 East and 18 Classic The new location improves many, if not all operational, safety and size requirements to good standards the current range can’t hope to achieve. This alone may be reason to move. Operational cost savings are another likely reason, as the new location would eliminate the need for a separate manned range house. It should also lead to greater usage from golfers playing the courses. Note, the re-numbered option does shorten total range length. Advantages of the new possible locations are compared on the next table:

Driving Range Comparison Tee Ideal Good Min. Existing Range 1 Range 2 Width (feet) 720 480 360 285 345 345 No. Stalls (10' wide) 72 48 36 28 34 34 No. Stalls (9' wide) 80 53 40 33 8' 38 38 Teaching Tees 4 2 1 2 1-4 1-4 Grass tee depth 180 140 100 0 120 120 Landing Zone Length (yards) Maximum Back Tee 320 310 300 255 315 285 Minimum Front Tee 300 290 280 255 275 245 Landing Zone Width (yards) Width (yards) 190 180 170 95 170 170

Note: Red< minimum standard, yellow=minimum standard, green >minimum standards.

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Other Practice Facilities If we re-position the range, it provides an opportunity to improve all other practice facilities. Furthermore, if moved, there is an opportunity to upgrade the ambiance of the range, perhaps increasing business. Golfers expect most of the following in a quality driving range: • Pleasing Overall Presentation (i.e., no nets if possible) • Good Turf Tees • Good Practice Balls • Target greens and fairways, like course, to make practice more realistic • For all targets, seeing balls land to gauge distance and ball flight • Accurate/visible distance markers in the landing areas • Separate Chipping, Bunker Play, and Putting areas replicating course experience • Experience various lies and turf – fairway and rough, level and sloped, etc. • Never facing sun (usually N-S orientation, or SE best) • Wind in face to accentuate poor shots (for Northbrook Park District, facing S to SW might be perfect for both) • Short game, practice all lengths, all winds, to all green slopes. These don’t generate revenue, but they draw serious players and improve your image. • Wedge Range, with great markings for practicing distance control under 130 yards. • Near the clubhouse, and convenient to the first tee, since typical golfer sequence is pay green fee/load cart/practice long shots/practice short shots/putt/tee off. • Separate serious practice chipping and putting greens. • Open and enclosed lesson areas, with video capabilities. Creature comforts are gaining importance, including: • Misters in the summer, heaters in the winter. • Patio furniture for relaxing between sessions. • HDTVs to watch other sports. • Food service options. Extending Range Hours Using Lighting Lighting can extend business hours for the convenience of golfers and from some reports, enhance revenues by 20-40%.

Extended hours work best in warmer climates, where h eat relief drives many sporting activities until after dark. In northern climates, days are longer and cooler, reducing the effectiveness of extended hours somewhat. In suburban communities like Northbrook, night range use typically declines during:

• The School Year and most week nights as work and family considerations take precedence over perfecting the golf swing.

• In May and October when night time temperatures average below 50°

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However, there is some market for night lighted ranges, as competitive night golf ranges in the Chicago area: - Top Golf facilities remain open until midnight on weekdays, 2am on weekends, and 11pm on Sundays. Top Golf caters to a larger degree to the “date night” crowd, with its extensive food and beverage offerings and club atmosphere. - The Des Plaines Golf Center also stays open until midnight from May to Labor Day, and 10pm through November 1st. It is probably your closest comparable. The actual maximum time extension of active use for Northbrook Park District is shown below: Potential Revenue Increases with Night Lighting at Sportsman's Country Club Month May (15th) June (15th) July (15th) Aug (15th) Sept (15th) Oct (15th) Sunset 8.23PM 8.27 PM 8.27 PM 7.49 PM 6.58 PM 6.08 PM Twilight 8.37 PM 9.02 PM 8.56 PM 8.20 PM 7.26 PM 6.36 PM 10PM 1H23M 0H58M 1H04M 1H40M 2H34M 3H24M Minutes 93 58 64 100 154 204 Buckets Per Station (1 Hour/Bucket) 1.55 0.97 1.07 1.67 2.57 3.40 *Daily Buckets Per 30 Stalls @ 75% Use 34.9 21.8 24.0 37.5 57.8 76.5 Monthly Buckets @ 26 Days Use 907 566 624 975 1502 1989 Max Monthly Revenues @ $8 $ 7,254.00 $ 4,524.00 $ 4,992.00 $ 7,800.00 $ 12,012.00 $ 15,912.00 12AM 3H23M 2H58M 3H04M 3H40M 4H34M 5H24M Minutes 203 178 184 220 274 324 Buckets Per Station (1 Hour/Bucket) 3.38 2.97 3.07 3.67 4.57 5.40 **Daily Buckets Per 30 Stalls @ 50% Use 50.8 44.5 46.0 55.0 68.5 81.0 Monthly Buckets @ 26 Days Use 1320 1157 1196 1430 1781 2106 Max Monthly Revenues @ $8 $ 10,556.00 $ 9,256.00 $ 9,568.00 $ 11,440.00 $ 14,248.00 $ 16,848.00 Max Annual Revenue Increase $71,916.00

Average Sunset for month taken mid month * Assumes one rain day per week, and 75% useage in summer ** Assumes one rain day per week, and 60% useage, with useage declining significantly after 10PM

Range Lighting Modern Driving range/Practice Area lighting is more complex than even a decade ago. Golfers expect the illumination of both the tee line and landing area, which allows them to follow every shot’s flight to landing, assessing their performance. In addition, women and many male urban golfers prefer brightly lit areas to promote the feeling of safety.

Night oriented facilities such as “Top Golf” and others have upped the ante, and we have seen that poorly lit driving ranges suffer lost business. Chicagoland is a sophisticated market, and the current range is lighted to 1980’s standards. At Sportsman’s Country Club, we recommend upgrading to closer to state of the art lighting to upgrade the image of your range. If adopted, this requires:

• Lights behind the driving range tee, shining down on tees themselves

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• Up lights behind target greens to illuminate the bottom of the balls while flying, improving golfers shot tracking. • Side lighting to further brighten the landing zone. • Improved parking lot and path lighting

Sportsman's already has range lighting, but it might be possible to upgrade your image and thus revenue slightly by addition of lights, based on the popularity of other, better lighted ranges. It is difficult to predict. An upgrade would bring new customers, but could alienate some existing customers, especially if the upgrades require a higher per bucket charge. If pursued, cost will vary widely, based on final design. Comparing recent projects, adding inflation, and the 35% “Chicago prevailing wages factor”, we expect a near state of the art lighting system to cost $100,000-$185,000, not including costs not known about the locations/capacity of transformers, which might increase costs. We have seen new three phase power lines installed for nothing, with future surcharges covering installation cost. In other cases, running the three phase lines cost over $30 LF. At $8-10 per bucket, breaking even on the presumed maximum $13,000 annual debt would take 1300-1625 additional buckets, or less than 8-11 per useable range day, which seems reasonable to attain.

Examples of selected range lighting possibilities

Considerations for more lighting include: • Light spillage beyond the range property, ▪ Traffic impacts from light spillage along Dundee Road, (if left in the existing location), and light spillage into adjacent residential if located to the middle of the course. Any side lighting of the existing range would be limited to the north side, with lights aiming away from Dundee Road. These could be added if/when replacing existing wood poles with metal ones on the road side. ▪ Tee lighting will be a concern in the proposed new location, given they will aim directly at a few residences. It might require a

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covered roof, with lights shining directly down to the tee line to avoid unacceptable effects at the other end of the range. o Zoning Issues - Before installing any new lighting, ranges must meet any zoning requirements, which may require an impact study on light spillage and glare. • Environmental Issues – The current sustainability thinking considers light pollution as a factor. In addition to human impact, there are rare cases where extended/constant lighting impacts certain wildlife habitats, although we do not expect that at Sportsman’s Country Club. • Flight Pattern Disturbance - When near airports, like Sportsman’s Country Club is to Pal-Waukee, lights affecting landing visibility. However, the main runway glide path is away from Sportsman's and shouldn’t be a factor. • Maintenance – Properly installed, sports lighting requires only periodic maintenance, including lamp replacement, cleaning, and the like. There are few break downs and the typical lamps last many years. • Operating Costs – consisting of both labor and electricity. Northbrook has relatively low electric rates, with average commercial electricity rate in Northbrook of $0.045/kWh, according to internet research. Rates are often highest in peak summer use periods, and your blended rate might be closer to $0.05/kWh.

Newer LED fixtures use 25-50% energy to produce the same light, increasing the benefits of night lighting, and a total system might use 90 fixtures, using perhaps 35KwH, resulting in operational costs of about $2 per hour. All weather Hitting Stations There is more potential to increase revenues by extending the seasons with indoor capacity, heated capacity. While use rates would certainly decline in the off season compared to summer, an indoor area could add nearly 180 days of revenue streams. Maximum daily per stall capacity is about 15 hours per day, and 15 $8 buckets. Doubling the six-month season adds 150 additional days (in summer, reduced by rain days – off season, reduced when outdoor weather discourages travel to and from the facility.) If the lower 30 bays were covered, range revenues could nearly double from about $250,000 to $500,000. We estimate actual off-season use would be 50% or less compared to summer, with probable revenue increases of $125,000. If the range was double decked, increasing capacity by 90% to 54 stalls, (after accounting for stairs, support poles, etc.), summer revenues would also increase, However, since the range only operates at full capacity in peak hours, a more reasonable estimate would cap revenue increases at 60%, potentially adding $150,000 in additional revenues.

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The double deck range with heated/covered lower level creates potential additional revenue at $275,000. The question, to be answered by a winter survey of other facilities, is accurately estimating actual off-season use. It might not be 50%. In 2008, Northbrook Park District studied both a single deck cover, and a double deck range at the existing location. That cost estimate predicted: ▪ A covered double deck, 54 stall range about $1.5M. ▪ A covered, single level tee line only would cost about $600,000 (based on a proposed $900,000 deduct to eliminate the second story.) ▪ We can estimate the cost of partially covering a single level tee line as 125% of total cost divided by number of stalls, or $29,000 in 2008.

Today, assuming the original estimate was accurate, and adding $180,000 for lighting, considering inflation, that same design, and $70 per thousand for annual debt cost of improvement, that covered tee structure would cost about: ▪ $2.11M for two levels and 55-60 stalls ($148,000 annual debt) plus ▪ $975,000 for a roof cover, remaining at about 27 stalls ($68,000 debt)

A double deck range could increase revenues by $275,000 while costing about $148,000 in annual debt, paying for itself with a surplus of $127,000. Assuming 1.5 additional daily employees and additional electric costs, average operations cost could average $60,000 per year, creating net gains to a maximum of $67,000. Covering 30 bays only, without a second deck could increase revenues by $125,000 while costing about $68,000 in annual debt, paying for itself with a surplus of $57,000. Additional electric and labor costs could average $60,000 putting net gains at about $0. If off season use is estimated 50%, similar revenues could be obtained if capacity was used with perfect efficiency. Given the differences between peak and off-peak demand, utilization would be slightly less, but 8 to 15 bays could bring 67-95% of revenues, while cutting construction cost. The cost of partial cover is estimated as 125% of the total per cost/divided by number of stalls due to lost economies of scale, or $30,000 per stall or ($2,100 annual debt per stall. Adding lights increases revenues, and cost $185,000. o 8 Stalls - $425,000 or $30,000/53,000 per stall, with lights o 10 Stalls - $485,000 or $30,000/$48,500 per stall, with lights o 12 Stalls - $545,000 or $30,000/$45,400 per stall, with lights o 15 Stalls - $658,000 or $30,000/$42,300 per stall, with lights

Covering 8, 10, 12, or 15 bays would cost about $30,000/34,000/$38,000/$46,000 in annual debt. Additional electric and labor costs should both be reduced by a third or more from estimates above, to about $40,000. Assuming 65/75/85/95% of the maximum $125,000 additional revenue, there are small net profits of:

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Covering 8 stalls – (-$8750) Covering 10 stalls - $19,750 Covering 12 stalls - $28,250 Covering 15 stalls - $32,750

Overall, the construction cost of offering some covered all weather stalls can raise current range revenues - $20-32,750, or 8-13%. It comes with a large construction cost, and attendant risk of not recouping your investment. It might also face some opposition, whether left on Dundee Road or moved to the middle of the course, so we are neutral on recommending adoption of any covered range at this time.

Investing in a nice structure upgrades course image and allows indoor teaching facilities, enhancing your junior golf instruction, while also attracting adult lessons.

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A structure like this would double your capacity at either location. While suitable if the range stays in the existing location, it will be part of your view corridor if you move the range. In the existing location, double decking will require nets to be higher.

Cost/Benefit Analysis on Moving Range Moving the range closer to the clubhouse will allow for the closing of the range house (assuming the miniature course is moved to AGC). This will save $25,000 in labor. Moving closer to the clubhouse should generate about $1/round additional revenue from existing golfers. This generates an additional $55,000 in revenue. Expanding the number of tees, will increase capacity during the busy times. This should add another $25,000 in revenue. Adding covered and heated stalls allows for play in the off-season, as well as in inclement weather during the season. This should add another $25,000 in revenue. Combined, these add $130,000 in cash flow. This would support a debt service of $1,850,000. The cost of the new range is expected to be $1,400,000 (with soft costs, about $1,680,000). However, this does not include the impact on the Academy. The Academy will also greatly benefit from the new range, especially with the indoor practice facilities. This could easily add another $100,000 in revenue. In addition, the overall appeal of the facility will increase, which should add more rounds and even more revenue.

Back Tee Length/Par Sportsman’s is shorter than today’s preferred length, especially for top caliber players. There are no tees to accommodate them. Worse yet, the perception of Sportsman’s is that it is even shorter, owing to its par of 70, vs. the traditional par 72. In the age of internet marketing, when your first new customer touch is probably your web site, and specifically, the yardages posted, this is critical. Some golfers

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Golf Operations Assessment Architect’s Report turn away before reading any further, as exemplified by the first comment on Old Orchard Golf Club in Prospect Heights, IL on Golflink.com: “If you only read one thing - this is a short course.”

Note: Old Orchard is only 91 yards shorter than the Classic 18. Yes, length matters to a clear majority of golfers, even if they never play the back tees. The Sportsman's scorecard:

Versus the course lengths golfers traditionally prefer to play. Golfers prefer par of 72 (tradition) and 5-6 sets of tees at the lengths shown in the following table (note: the color labels refer to the most frequent seen pattern. However, there is no “standard” in place. Elsewhere we describe the “back” tee as the one with the longest yardage, the “regular” tee is what is shown below as the “white” and the “forward” tee is what is shown below as “red”):

Par 70 and 71 courses are naturally shorter than par 72 courses, owing to fewer full shots. The amount of lost yardage varies with configuration. Traditional par 72 courses contain four par 3 holes, 10 par 4 holes, and four par 5 holes. Par 71 courses usually drop one par 5 for a par 4, or drop one par 4 for a fifth par 3.

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Tee Comparison Traditional Color/ Driving % of Sportsman's Par 72 Par 70 Add Distance/% Top Golfers Existing 7000- 6800- Black – 290+ 1% None 600+ Yards ? 7400 7200 6550- 6350- Gold – 260 Yards/90% 16% 6278 298 6850 6650 6100- 5900- Blue – 230 Yards/80% 50% 6010 Good 6400 6200 5650- 5450- White – 200 Yard/70% 19% 5558 Good 6000 5800 5100- 4900- Good for Silver, Silver – 170 Yard/58% 10% 5133 5600 5100 not Red 4650- 4450- Add New Red – 140 Yard – 48% 5% None 4850 4650 Forward Tees Build Actual 3000- Tees, Not Place Junior – 90-100 Yards - 3250 Markers in Fairways Par 70 configurations include: ➢ Four par 3 holes, 12 par 4 holes, and two par 5 holes, converting two short par 5 holes to long par 4 holes. These courses get tougher, but don’t sacrifice much yardage.

➢ Five par 3 holes, 10 par 4 holes, and three par 5 holes. These courses, including Sportsman's convert a par 5 to a par 3, with about 350 yards overall yardage loss.

➢ Six par 3 holes, 8 par 4 holes, and four par 5 holes. These courses convert two par 4 holes to par 3 holes. With average 390 and 160-yard holes, total yardage loss is about 450-500 yards.

At only 6,278 yards maximum, Sportsman's doesn’t offer 17% of golfers enough length to fit their preferences. Extending to 6,350 yards, and preferably to near 6,650 yards would expand your potential marketplace by another 16%, but still not appeal to the longest hitting golfers for everyday play. (They would likely enjoy playing max yardage in a scramble event.) It would also produce a marketing boost, as better players have disproportional influence on the reputation of golf courses, as average golfers often follow opinions of “those who should know” in picking places to play, even if once there, they are very practical on choosing the proper tees to enjoy their game. While there will still need to be some advertising and marketing to counteract the notion that Sportsman's is a “short course”, in design terms, we can be closer to the perceived “good yardage” for par 70 by:

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➢ Forgetting about attaining championship (black) yardage. (To do so would require extensive rerouting, probably of both the Classic 18 and the East 9)

➢ Adding/finding up to 100-370 yards for desired Gold Tees

There are some opportunities to lengthen the course: • The No Cost Way – Your current scorecard reads 6,278 yards. Our scale ACAD drawings, measuring from 2 yards inside the back edge of all tees is 6,404 yards. In the field, we confirmed most tees were measured somewhat short of maximum yardage. If allowed by CDGA standards, it is common to measure as far back as possible to maximize yardage, which we recommend as the free way to add 126 yards. (However, this still does not get you over the psychological 6,500-yard barrier).

Revised Yardage – about 7 yards per hole, 63 yards per nine, and 3144/3260 – 6,404 Yards.

• The Moderate Cost Way – For about $30,000 per tee, including construction bid, contingency and soft costs, there are a few holes where back tees could be moved/extended to increase back tee length, including:

Classic Front Nine – Add back tees on holes:

• 2, adding 15 yards. (Perhaps rarely used) • 3, adding 25 yards. • 8, adding 18 yards Total additional yardage, 58 yards. Classic Back Nine – Add back tees on holes:

• Reshape 11 Tees, eliminating birch tee, and push back to fence, adding 6 yards • Add new back tee on 12, on existing path (with path re-route) adding 12 yards • Extend No. 15 Tee to the mound east of 5 Tee for back tee. Daily set up must consider the other tee for safety reasons, but hole lengthens from 408 to 443 yards, adding 25 yards. • Move 17 tee east to the entry road, lengthening from 544 to 582 years, for 38 yards. • Add Alternate Back Tee on 18, combined with new hole 2 back tee, add 5 yards. Total additional yardage, 86 yards. Classic 18 Yardage (if all adopted) 3202/3346 – Total 6,548 (net 270 Yards). $240,000 of tee construction adds 270 additional yards, or $889 per yard, and $13,300 per hole.

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• Rerouting – Re-route, moving 4 greens (with Chicago labor conditions, contingency and soft costs, costing $155,000 or more each, and 4 more tees (at $125,000 each) including

Front Nine – Re-route by moving:

• Holes 3 and 4 • Move 3 green forward and left, loss of 29 Yards • Move 4 Tee to behind old 3 Green, adding 73 yards, net gain 44 Yards. Also solves safety problem between two holes, especially no. 4 tee. • Holes 6 and 7 and 10 o Move 6 Green to Garbage Dump – No yardage change o New Back Tee, combined with back tee on 10 – adding 100 yards, also allowing more room to expand tee on hole 10.

• Hole 8, Move Green South to Pond for challenging par 3, reduce safety issues on 9 Tees. Loss of 10 Yards Total net additional yardage, 105 yards.

Back Nine – Re-route by moving:

• Holes 15 and 16 o Shorten 15 green, a loss of 19 Yards o Lengthen 16 Tee, adding 33 yards, net gain 14 Yards. Also solves safety problem between two holes, adding value to proposed change.

Total net additional yardage, 14 yards.

Classic 18 Yardage (if all adopted) 3307/3360 – Total, 6,667 Yards, with near perfect balance. Total cost: $1,120,000

Extending East 9 Back Tee Yardage for “Show”

• The No Cost Way – The actual yardage is shorter than scorecard yardage, (2,977 to 3,010). Fudging opportunities are limited without outright fabrication. If tees are renovated, it will be less obvious to golfers that yardages are simply padded. No Change Likely.

• The Moderate Cost Way – For about $30,000 per tee, plus some additional costs of about $50,000, back tees can be moved or extended, including holes:

o 4, add new tee on one peninsula in the lake, while shifting 5 fairway, adding landscape plantings for safety, and a foot bridge. Pond size equalized by “connecting the dots” into a straighter line on hole, which increases. 54 yards.

o 6, add new back tee behind back tee of hole 8, adding 36 yards.

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o 9, extend tees back into woods, cleaning up the area and adding 18 yards

Total additional yardage, 108 yards. New total, 3,119 yards (using existing back tee measurements, plus additions) This matches well with existing Classic 18 yardages, assisting in equalizing course perception, if desired. However, it is still the shorter nine if the Classic 18 yardage additions are implemented.

• The Expensive Way – Moving the range requires partial re-routing and total renumbering of holes 2, 3 (converted to a par 4), and 5. New holes will be created on the old range, as new holes 8 and 9, a par 3 and 4.

Green relocations add 70 yards, raising the East Nine Total to 3,189 yards, still the shortest nine, but closing the gap on the front nine.

27- Hole Arrangement If the East 9 remains a stand-alone 9-hole courses, it would require little rebuilding (other than irrigation). Even lengthening as proposed is not necessary. We considered, but did not find it justified to create a “true” 27-hole facility. By this we mean that each nine is of approximate equal value, resulting in three possible 18-hole arrangements: (assuming the nines are numbered 1,2, and 3) 1&2, 1&3 and 2&3. However, for a “true” 27-hole arrangement to work, it requires that all three nines be of equal quality. The reasons we rejected this arrangement include: • Quality: It would require essentially rebuilding the East 9 to get it to the quality level of the two Classic 9s. This would include adding more bunkers and features, eliminating the extended mounding, etc. • Length: It is not possible to make the East 9 as long as the other two nines due to land constraints, especially if the other nines are lengthened as recommended, without extensively rerouting all 27 holes, at a great expense (essentially rebuilding the entire course). • Current Market: The East 9 serves a very different market than the Classic 18. If we did make the three nines compatible, it would likely mean losing the existing the customers of the East 9. Given that it sees as many customers as the Classic 18, this does not seem like a gamble worth taking.

Given the expense, no plan proposes the complete rebuilding of East Nine greens. However, if the greens were rebuilt the same as the Classic 18, it would yield maintenance and play consistency, which may be worth it, even if the “three equal nines” business plan is never implemented. The overall cost of complete rebuilding of the East 9 in the maximum plan is already $3.6M, as opposed to about $4.45M for each nine on the Classic 18. An additional $850,000 would have all 3 nines looking and playing consistently. Below are some possible ways and yardages in which SCC could be configured as a 27-hole course:

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Relocating green complexes is expensive, at about $155,000 per green. In addition, a few fairways would move, lakes reconfigured, nearing the total average new hole cost of $300,000 or more. We would expect a nearly new East 9, 179 yards longer, to cost close to $3,000,000. The renovation plan does provide for reshaping lakes to enlarge both detention and irrigation storage capacity

Prop. Yardage Front Back East F/B E/F E/B F B E Full Tees Tees

Existing 3081 3197 3010 6278 6162 6201

Scorecard 3144 3260 3010 6404 6154 6270

Plus Tee Extensions 3202 3346 3119 6548 6321 6465 3202 3346

Rerouting 3307 3360 3189 6667 6496 6549 3189

New Range 3058 6391 6535

18 plus 9 If the East 9 remains a stand-alone 9-hole courses, it would require no rebuilding (other than given their condition and expected life span). Nor would it require lengthening as it is appealing to a different market. A discussion of the performance differences between each scenario can be found later in the report.

We have attached a plan graphically depicting proposed changes. Forward Tees Length/Par As Sirius describes in the main report, your most important length considerations are the two forward tees. Golf (and Sportsman's) needs shorter yardages for economic and social equity reasons, and shorter courses have proven (in limited sample sizes) to make/keep golf fun and attract and retain these groups. We recommend Sportsman's tees to be reorganized to allow all golfers 18 greens- in-regulation (GIR) chances, based on two good shots at maximum yardage, by holding hole length to somewhere between their: ➢ 95% maximum expected yardage for greens-in-regulation (GIR) shots

➢ Proportional distance between average men, senior men and recreational women golfers, allowing all golfers to hit approximately the same club to greens.

Based on 140/170, or approximately 60% and 75% of the 230 Yards average drives of male golfers, the forward two tees based on the existing Classic 18 yardage equate to:

➢ 4,708 yards to 5,491 yards for Senior Men, for par 70.

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➢ 3,767 to 4,655 yards for Recreational Women, for par 71.

For the Classic 18, this is easily accomplished by: ➢ Converting existing gold/forward tees to Silver at 5,188 yards, the upper limit desired.

➢ Adding New Red Tees averaging 45-50 yards (more on par 5 holes, less on par 3 holes) ahead of the current forward tees. We find some resistance to dropping below “thousands, and would seek red tees at no less than 4,000 and 5,000 yards for these tees. Actual placement is determined in the field, favoring practical location over “perfect” over predetermined length.

As Sirius describes in the main report, your most important length considerations are the two forward tees. Golf (and Sportsman's) needs shorter yardages for economic and social equity reasons, and shorter courses have proven (in limited sample sizes) to make/keep golf fun and attract and retain these groups. Some percentage of recreational women and senior men can play longer than the proposed new course yardages, and are free to do so! However, the goal is to allow all golfers to enjoy golf like average prime age men i.e., hitting many greens in regulation, forward tee yardages must be shorter.

Advantages of creating new, shorter forward tees and five tee sets instead of four, include: ➢ For everyone, nearly 18 GIR chances, and more actual pars and birdies (better scores = happier customers = more return business) ➢ No/fewer de facto par 5 (or 6) holes with dull middle shot(s) ➢ Faster Play (for all), by eliminating 9-12 unnecessary “distance only” shots per round. ➢ Increase in women and family play. (as shown by early adopters) ➢ Senior men enjoy golf as much as they did when they were younger, without resorting to playing red tees. Disadvantages include: ➢ Courses much shorter than existing and traditional in golf, condescending to some ➢ Initial resistance, usually overcome once implemented. ➢ Potential visual clutter. Routing Safety Issues Golf has some inherent danger, and safety is partly a function of design, including routing. Liabilities for adjacent land uses is greater than for on course players. On course, congregation points, like tees and greens, where multiple golfers are potentially in danger from the same shot, deserve the most consideration.

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Like most older courses, Sportsman’s is tighter than newer courses, but decades of tree growth provide some cover. Overall, despite longer drives and more golfers, Sportsman’s is a safe course, and the biggest potential for “safety problems” would be: Classic 18 ➢ 4th, 9th, 14th and 16th Tee too close to previous greens ➢ Back nine slices O.B., but with adequate safety buffers, except: o Hole 16 too close to, and possibly within adjacent ROW. Driving range style netting may be required if the road expands. Moving the hole would require partially filling the pond, and other changes, which are expensive. o 10 Green sits too close to property line and houses, as a 150-yard par 3, the conflict is less than expected. o Tree on Hole 17 forces golfers too close to property line on second shot (although removing it would cause an uproar) East 9 ➢ The sixth hole too close to sidewalk, (but on left side and with a wetlands buffer) ➢ 4th Tee in slice zone of 3 Tee, but as a short par 3, the conflict is less than expected. ➢ 8th has Dundee Road on the slice side, but is a par 3 and has mature trees ➢ The 9th hole has the maintenance building and service road on its slice side, which receive a constant barrage of golf balls, and should get nets. Circulation/Speed of Play Speed of play is an industry concern, with some evidence showing it even reduces participation. It surely reduces enjoyment! Design features that affect pace of play, and holes affected at Sportsman’s Country Club, include: Classic 18 –

➢ A par 3 hole at 10 ➢ Long Walks from: o 5 Green to 6 Tee o 10 Green to 11 Tee o 14 Green to 15 Tee ➢ Walk back from 5 Green to 6 Tee East 9 –

➢ Confusing routing, with walk arounds to get from 5 to 6 and 7 to 8. ➢ Long walk from 8 to 9. ➢ Long strip bunker on 7 green forces golfers out of the way.

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Rerouting Plan 3 changes the 10th hole (renumbers and moves away from houses, and switches the 5th and 6th holes to avoid a walk around on the East Nine.) It is difficult to say how many more rounds you might get by reducing the total round time from say, 4.5 to 4 hours. Logically, you add at least 3 foursomes, or twelve rounds per day over 180 average play days, potentially netting 2,700 rounds, if every day was played to capacity. You would probably net half that, but 1,300 rounds are still a substantial improvement and could add over $60,000 to the annual gross revenues on the Classic 18. Design Features/Quality Although golfers cannot always articulate what they like about courses, they often (and loudly) mention things they don’t like. There is little doubt design quality contributes to golfer enjoyment. In general, if your tees sheets aren’t full, improving your course design should improve its attractiveness to customers. Classic 18 We believe that the Classic 18 is a well-designed course, other than problems noted above. As a kid playing in the area, and as a veteran golf course architect now, I find the design to be visually attractive and reasonably playable. We are nearly dumbfounded at the relatively low reviews/rankings golfers give the course in the customer surveys, and on line. Parsing through them yields a mix of service and maintenance complaints, which are often confused with design by average golfers. Design related comments include:

➢ I wish the course had a bit more character ➢ A lot of the par fours feel the same ➢ 9th hole is too long as a par 4 ➢ Many of the holes are wide and straight-away ➢ First green is ridiculous, somebody buried something large there. ➢ I wish the course had a bit more character

The only actionable design complaints are to:

➢ Routing Comments: o Move tees back on 8 to make it a short par 4 o Recommended if East 9 stays as separate golf experience, o Not recommended if we create 27 equal holes, to keep each nine par at 35 o Move the 9th tee forward or back to shorten as a par 4, or make short par 5 (Recommended, but keep back tees in place for scorecard yardage)

➢ Aesthetic Comments

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o "Aesthetic appeal of it is lacking”. (disagree, but not all golfers like traditional design) o “Lack of that "it" hole, i.e., signature hole,” True o “Generally flat course.” (not much to be done with nature) o "Holes are boring and monotonous. Other than 5 and 13, there are no features” ▪ There is some repetitive bunkering, with: ▪ One hole with no fairway bunkers (13) ▪ One hole with one fairway bunker (16, which also has a pond) ▪ Six Holes with two fairway bunkers (2, 4, 5, 9, 12 and 15) including three consecutive long holes on the front nine at 2, 4, and 5) ▪ Four Holes with three fairway sand bunkers (7, 11, 17, and 18 (with one in second LZ) ▪ To vary “feel”, you could add bunkers on some holes, remove them on others

East 9 Architects Opinion – We find the highly mounded, 1990’s style of the East 9 is inferior to the Classic 18. However, golfer comments are surprisingly positive, despite problems of blind ponds, walk arounds, excessive mounding. Biggest negative comment is that the East 9th Tee is unsightly. We believe the forward tees are necessary here, as well. Family tees can remain informal, and cut out of existing fairway. The irrigation needs to be replaced. We believe the irrigation lake should be deepened and expanded to assist in detention and water storage. Many of the lakes, with numerous small fingers are not visible to golfers. (No. 4 green being the best/worst example. Simplifying that lake edge in an expansion will provide a better golf hole. The mounds can be reduced in scope, size and steepness of slope. The fill can be used to raise low areas, build new tees and greens, etc. If not a true 27-hole facility, matching the Classic 18 is not required, but better design would make the course more attractive. Infrastructure/Agronomy Public golfers usually comment most often on maintenance, including condition of greens, tees, bunkers, fairways and roughs, in about that order. Maintenance Quality can be related to procedures and treatments, but can often have an “upper limit” to quality because of infrastructure, which bears examination, starting at the top. Maintenance Related Complaints These are more common, and are generally “actionable”. They focus on: ➢ Inconsistent Bunker Sand, bunker banks mowed too long (since corrected)

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➢ Bumpy Greens (heard nearly everywhere) ➢ Unlevel Tees ➢ Need Electric Carts, Paths Greens Greens and putting surface quality are consistently ranked by public golfers as the top factor in choosing a public course to frequent. The greens at Sportsman’s were in excellent condition on our visits, but are subject to golfer complaints as falling short on speed, smoothness and consistency, for at least parts of the golf season. Classic 18 Construction and Materials - The original course had “push up” greens, typical in 1931, which have never been fully rebuilt. They have been top dressed with sand over the years, but sand accumulation was not nearly as much as some older courses we have seen. Jacobson chose to strip the existing sod, add 1” of Waupaca sand to replace the soil lost when removing the root mass, and replant. In a few cases, they softened steep contours by scraping some topsoil off, reducing the amount of remaining topsoil, and these areas become problems before others. Little drainage was added. The topsoil mix is heavy in clay, and the root system is shallow, combining to cause poor drainage. The greens will show stress in difficult summer heat. In early spring, poor drainage makes Sportsman’s one of the latest public courses to open. The unpredictability causes loss of image and revenues as golfers hate to take chances on playing substandard greens. The Classic 18 loses all revenue for about 7 days each spring, and an average of another 7 days after summer rains, specifically because the greens are too wet. 14 days at an average Classic 18 daily revenue of $5,000 causes about $70,000 in lost revenues annually, suggesting an opportunity to recoup costs by renovating to solve drainage problems. This does not consider increased play that would likely result from new greens and the elimination of the “stressed” look at the end of summer. As problematic as daily closures might be, push up topsoil greens are also more prone to sudden, massive, disastrous turf loss in extreme heat conditions. (They may do slightly better in winter freeze conditions) It would take at least a year to rebuild, grow in and reopen, in event of unplanned disaster. Given increased probability, and presence of 27 holes allows you to correct the situation before disaster strikes in an orderly planned fashion, while accommodating most, if not all, play on the 18 holes remaining open. Turf Type - Predominantly A-4 Creeping bentgrass, with some poa annua. Green speed goal is 10, but maintaining for health over speed, combined with soil conditions, probably keeps speeds at about 9 days. A-4 was popular when re-constructed, but if rebuilt again now, T-1 would be a better choice. If rebuilt in the future, there is strong likelihood even better grass choices will be available.

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Size and actual Cupping Space – Total space is 97,328 averaging 5,407 sf, to follow the traditional design goal, but probably small for a busy public course, especially considering construction method. Most have 80-90% cupping space, but the first hole, with the large mound in the center is disliked and reduces cup space. Contour Relative to Modern Green Speeds – Most greens have good slopes for putting, but could be flattened if greens get faster. Circulation Patterns – Public courses need good and quick circulation to speed play, and avoid excessive wear caused by repetitive traffic, forced into narrow corridors. It is best to design in wide and relatively flat areas for access and exit somewhere at the back half of the green. Extensive bunkering and a few walk backs and walk arounds pose some maintenance problems at holes where: ➢ 2, where back right sand bunker blocks primary entrance/exit ➢ 3, where right side sand bunkers block primary entrance/exit ➢ 4, where left sand bunker blocks primary entrance/exit, causing walk back to cart ➢ 10, where right side sand bunkers block primary entrance/exit ➢ 12, where front of left sand bunker limits route to path ➢ 13, where front of left sand bunker and pond limits route to path, requires roping ➢ 15, where front of left sand bunker and pond limits route to path, requires roping ➢ 16, where back left sand bunker pushes primary entrance/exit to back (not all bad) ➢ 18, where right sand bunker limits route to path, pushes entry to back (not bad)

Growing Conditions (Shade, Drainage) The 16th green suffers most from shade, requiring some tree removal (and possible relocation of 17 tee for safety. Other potential green shade problems exist at 4, 7, 8, and 9 as well as the main practice green, with mature trees on the east side of those greens. In house thinning in selected areas may help turf growth. East 9 Construction and Materials – The greens are USGA style, with good drainage and adequate roots. These greens open sooner than those on the Classic 18 owing to construction, and hold up better in stressful conditions. Turf Type – Originally Penncross, now a Poa/Penncross bentgrass mix, with typical poa encroachment in older bent grass greens. If/when the course replaces green turf (which is recommended every 15 years or so, and past due), the preferred choice would be T-1 for the near future. If the course is combined with the Classic

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18 to form a true 27 holes, the same turf would have to be used, whatever choice is made. Size and actual Cupping Space – Greens total 47,790 sf, an average of 5,310, which is below the typically recommended size of 6,500 sf for busy public courses. They may have shrunk (as is typical everywhere) since construction in 1990. Cup space is adequate, but could be improved by restoring greens out to their original mix edge. Contour Relative to Modern Green Speeds – The greens are currently slow compared to higher fee courses. The contours range from 2-3%, with 3% slopes a bit steep if greens became faster. It is possible under USGA specs to alter the recommended 12” depth (presumed construction is good) up and/or down 2”, for a range of 10-14”. This can be used to slightly flatten areas presumed to be too fast to putt under new turf and improved maintenance conditions. Circulation Patterns – The 5th hole forces golfers around a long strip bunker. In general, the mounding around the greens narrows walkways which eventually causes turf wear. The convoluted routing causes some other circulation issues and slows play. Growing Conditions (Shade, Drainage) – On the East 9 at Sportsman’s, greens 1 and 4 have shade issues. Clearing trees from the northeast to southeast sides would improve growing conditions. While morning sun is most important, even clearing shaded greens from south to west would allow in more hours of sunlight. Current Condition – The greens appear to be in excellent shape on the East 9. However, they are 27 years old, an age suggesting total replacement is almost at hand, and no more than 5-10 years away.

For the short term, they would only be re-grassed to combat poa annua invasion. Longer term, any of three options is justifiable: ➢ Remain as is, re-grassed with existing structure in place ➢ If Classic 18 greens are rebuilt, rebuild to same standard for consistency: o Golf – Speed, Turf, Slopes o Maintenance, bringing all three nines to same maintenance regimen. ➢ If any East 9 greens are relocated, they need new construction, and rebuilding others will keep them consistent Attaining consistency requires rebuilding all three nines in a brief time frame (perhaps nine holes per year) for maximum consistency. Older sand based greens are different than brand new ones, which is minimized by construction of all in three years or less. Rebuilding Greens Sportsman's needs to improve the Classic 18 greens surfaces, and there are three basic options, with different price tags and expected results, to pursue:

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XGD or similar drainage into Existing Turf As the picture from XGD website at right shows, XGD is a system of narrow pipes cut into existing greens (usually with similar topsoil bases and drainage problems) at 6 to 10-foot intervals. The narrow strips heal in a matter of weeks, and many courses report improved drainage. Advantages include: ➢ Lowest cost choice. ➢ Least lost days of play

Disadvantages include: ➢ Greater chance of major turf loss due to poor soils, even with better drainage. ➢ Shorter expected lifespan ➢ Inconsistency between East 9 and Classic 18.

Typical price for the full XGD system is about $2-$2.25, and $3-$3.25 when using Chicagoland prevailing wages. The 108,000 sf of existing topsoil greens on the Classic 18, a full XGD project is estimated to cost $378,000. XGD Greens have a normal lifespan of 10 years. Complete Soil and Drainage Replacement with USGA, California, or Similar Green This method provides 12” of excellent and complete new growing medium by: ▪ Kill existing turf with Round Up, rototill, remove, discard turf ▪ Remove soil/mix ▪ Cut Green Core to 12-18” depth, depending on method ▪ Can Enlarge green surface, but must tie into collar/banks. ▪ Contour sub-grade to desired finish contours. ▪ Install Herringbone pattern: o 4” Tile Drainage (USGA) o Flat Tile in California ▪ Install 4” gravel in USGA Greens, none in California ▪ Test and procure sand based growing medium: o 95/5% or similar sand peat mix in USGA Greens o Pure Sand in California (sometimes modified to USGA mix) ▪ Replace Irrigation where required, moving if required Re-turf green and collars with seed, sprigs, sod, or combination of each. This method should suffice because there is little need to redesign surrounding areas on most Classic 18 greens.

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Design Improvements to Surrounding Hazards – In addition, where any Classic 18 greens with design flaws, or being relocated, the entire greens complex must be redesigned/rebuilt at additional cost. Rebuilding the entire green complex includes: ▪ Strip Sod and Topsoil on ¼ to ¾ Acres around green, typically out to path, ▪ Remove/re-use existing Greens Mix and bunker sand as tee mix or topdressing, ▪ Import fill if necessary, and shape area to final design with bulldozer ▪ Install USGA or similar green mix ▪ Place drainage, liners, and sand in any new bunkers. ▪ Grass the complex, typically: o Seeding Green to T-1 or similar o Sod Banks to accelerate maturation time, reduce risk.

Both California and USGA greens have at least double the life-span of the XGD, lasting 20 years or more. USGA or California Method relative costs are illustrated in the following table: Renovating existing greens surfaces will cost between $48,000-$70,000 per greens surface. Expected cost for rebuilding an entire greens complex would be at least $60,000 additional, for a total of $110,000-130,000, which includes cart path and curbs.

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PER SQ. FOOT COST OF USGA AND CALIFORNIA - 2017 GREENS CA USGA PREP WORK Kill Turf, Strip Thatch Layer SF $0.25 $0.25 Erosion Control - 110 L.F. # $3 SF $0.05 $0.05 Staking - $975 per green SF $0.15 $0.15 Shaping and Tie In ($1950 per green) SF $0.30 $0.30 DRAINAGE Cap or Connect Ex. Drainage SF $0.05 $0.05 Advantage Flat Pipe Tile 650 L.F. @ $4 SF $0.40 $0.00 or 4" Perforated Tile 650 L.F. @ $6 USGA SF $0.00 $0.60 6" Connection Drainage - Typ. 145 L.F. @ $9 SF $0.20 $0.20 12" Catch Basin 2 @ $500 SF $0.20 $0.20 B. Inspection Ports (4 @ $300) SF $0.15 $0.15 GREEN SAND/MIX MATERIALS Purchase Sand - Assume 400 Tons Per Green @ $35/Ton (.06 Tons/S.F.) SF $2.10 $2.10 Purchase Peat (typ. 5% by volume - $50/ton x 0.003 Ton/SF) SF $0.15 $0.15 Off Site Blend Peat (assume $12.50/ton x 0.003 Ton/SF) SF $0.75 4" Gravel Blanket - Assumed $40/Ton Cost x 0.02 tons/SF SF $0.80 Sales Tax @ 7.5% $0.06 $0.10 GREEN SAND/MIX INSTALLATION On Site Roto Till (assume $105/ton x 0.003 Ton/SF) SF $0.05 Place Gravel Blanket SF $0.75 Mix Placement SF $0.75 $0.75 Fiber Filtration Tube, Erosion Control LF $0.13 $0.13 GREEN SEEDING Fine Grade, Prep and Fertilize SF $0.12 $0.12 Plant Green and Collar SF $0.25 $0.25 Sod Collar SF $0.10 $0.10 EX. COURSE TURF PROTECTION, REPAIR Ex. Course Protection, Haul Roads, Repair SF $0.09 $0.09 Total $5.55 $8.04 LOCAL LABOR CONDTION ADJUST 33% for Prevailing Wage 1.33 $7.38 $10.69 California USGA Total For 6500 S.F. Green $47,947 $69,463

The cost for those is summarized in the table below:

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PER SQ. FOOT COST OF GREENS COMPLEX SITE PREP WORK Bid Bond/Security, Performance Bond, Warranty LS $1,000.00 1 $1,000.00 Move In, Staging, Tests LS $1,000.00 1 $1,000.00 Staking, Documentation LS $1,000.00 1 $1,000.00 Kill & StripTurf SF $0.15 30,000 $4,500.00 GRADING Strip & Replace Topsoil -3/4 Ac @ 6" 600 C.Y. @ $3.75 SF $3.75 600 $2,250.00 Cuts and Fills - 2000 C.Y. @ $3.00 SF $3.00 2,000 $6,000.00 Feature Shaping (full remodel -$3250 per green) LS $3,250.00 1 $3,250.00 Erosion Control - 110 L.F. @ $3 LF $3.00 200 $600.00 BUNKERS - AVE 2 @ 1500 S.F. Spray Weeds SF $0.30 3,000 $900.00 4" Perforated Tile Spacing, (1LF/20SF) $6/L.F. LF $6.00 100 $600.00 Inspection Ports EA $300.00 2 $600.00 Cut Bunker Edge/Prep LS $550.00 - $0.00 Bunker Liner (Better Billy Bunker @ $3.50) SF $2.50 3 $7.50 Purchase Sand - Assume $90/Ton Cost x 0.02 tons/S.F. TN $1.75 2 $3.50 Place Sand - Allow @ $0.50 SF $0.50 3,000 $1,500.00 DRAINAGE 6" PVC Pipe LF $9.41 100 $940.63 8" PVC Pipe LF $11.42 30 $342.66 10" PVC Pipe LF $14.78 20 $295.63 Add Gravel Bedding (>6") LF $8.06 $0.00 12" Catch Basin EA $500.00 $0.00 Bubblers/Tie In EA $300.00 $0.00 CART PATH 300 L.F. 12' Wide Cart Path (Asphalt) LF $36.00 300 $10,800.00 200 L.F. 4" Roll Curb (Concrete)ks LF $6.00 200 $1,200.00 SURROUNDS TURF Sod Banks SF $0.45 30,000 $13,500.00 EX. COURSE TURF PROTECTION, REPAIR Ex. Course Protection, Haul Roads, Repair LS $710.09 1 $710.09 Average Construction Total $51,000.00 LOCAL LABOR CONDTION ADJUST 33% for Prevailing Wage LS $234.33 0 $16,830.00 20% for Prevailing Wage LS $0.00 0 $10,200.00 Total $61,200

Recommendations at Sportsman's What is the proper choice at Sportsman's? Your annual revenue loss solely due to Classic 18 greens is about $70,000. Cost to renovate via: • Adding XGD drainage to 108,000 sf of existing topsoil greens on the Classic 18 is estimated to cost $378,000. • Renovating to California Method with full seed bed reconstruction (including addition of organic peat for moisture retention) for the equivalent of 20 greens (including putting, short game) and assuming increasing green size to 6,500 sf (recommended public course size) would cost about $1.16M,

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• Renovating to USGA Method with full seed bed reconstruction the seed bed for 21 greens (including putting, short game) and assuming increasing green size to 6,500 sf would cost about would cost about $1.46M. We can compare payback in years, or annual cost savings vs. assumed annual debt payment. Assuming Northbrook Park District borrows near the current average municipal bond rate of $3.5% and issues 20-year bonds, the annual cost is $70 per thousand. The XGD Method would create $26,500 annual debt vs. generating $70,000, a net plus of $43,500. However, Sportsman's will need to rebuild these greens, probably favoring sand based construction (finally ending the struggle). Thus, the XGD is only delaying the inevitable. Life span of topsoil greens is maximum 20 years, with rebuilding expected by 2027. The XGD Method also does not address the soils underneath and could lead to an inferior appearance compared to the other methods. California Method would create $81,500 annual debt vs. generating $70,000, a net loss of about $11,500. However, well drained sand based greens require less maintenance, fungicide and aerification, easily saving $11,500 annually, making this net zero cost. USGA Method would create $105,780 annual debt vs. generating $70,000, a net loss of about. $36,000. Assuming equal maintenance savings to California greens, the loss is reduced to $25,000. XGD is initially cheapest. However, long term, rebuilding with sand based greens is more cost effective. However, there is a practical balance between the highest standards and initial affordability. Greens are your most important asset, and must be right. You can’t go too far in cutting corners without paying a price, and your 2007 renovation is an example. It doesn’t seem wise to make the same mistake again! For a long-term owner, like Northbrook Park District, better construction is usually the right investment. (If you were a real estate developer or private owner planning on eventually selling the course, you might take a shorter-term approach, focusing more on dollars and less on sense.

Most, but not all, superintendents and consultants recommend USGA greens. We prefer to recommend a greens construction method that your superintendent endorses, Research has suggested slightly more efficient drainage and slightly longer life spans for USGA greens. They are generally recognized as the “standard” which provides some “cover” for consultants, owners, and superintendents alike, if your greens should happen to be among the 1-2% of courses that suffer major turf loss in any given year. (It’s almost exclusively attributable to extreme weather rather than construction type or maintenance practices). However, having had satisfactory results with California greens, and when factoring additional costs vs. benefits of USGA greens, it changes greens reinvestment from

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Golf Operations Assessment Architect’s Report net zero cost to negative territory. A cost benefit analysis shows the California Method Greens to be the best long-term investment. Because Anetsberger has pure sand greens, and they have been difficult to manage. we recommend a modified California Method approach, replacing pure sand with a mix of sand/peat meeting USGA recommendations. This recommendation is included in the typical cost provided. Tees Classic 18 Construction and Materials (i.e., sand mix or other) – The Classic 18 tees had been rebuilt over the years, by various architects, using a combination of free form, rounded and square styles. Tees for holes 12 forward, 9, 13 and 15 were rebuilt in 2006, the rest are much older. Depending on age, tees may have root-zone soils including native clay, 7-2-1 sand and other mixes. Levelness and Turf Conditions – Golfers complain about unlevel tees. On our tours of the course, we didn’t find that to be consistently true, but they could be improved. Additional top dressing will gradually help, but when tees of different construction methods are present, the only way to improve consistency is to completely rebuild: ➢ Strip sod, ➢ Level and compact sub-grade with bulldozers ➢ Add 4-6” of tee sand or mix, ➢ Place occasional 4” drain tiles where required drainage ➢ Laser Level ➢ Sod banks for quick recovery ➢ Seed Tees to an aggressive Bent Grass

Based on golfer complaints, and the desire for a consistent maintenance regimen, rebuilding tees should be a high priority.

Size – Total Area/Matching Area to play on each tee – Overall, tee size is adequate, totaling 141,300 sf overall, and averaging around 7,850 sf, which would be the envy of even the busiest courses. When we add forward tees, as proposed, that average should rise by 800 sf However, some changes should be made. Par 3 tees sizes need to be 20% larger on average, to keep them in good condition, so when rebuilt, these should all size about 9,800 sf each, perhaps more on holes 8 and 10, with their water hazards. Actual current tee size on par 3 holes: • Hole 3 – 7767 sf (but several small tees are less effective at distributing wear - add 2,000 sf and reorganize) • Hole 8 – 3660 sf (and shady, add 6,150 sf or more) Other tees that need more size to equalize maintenance conditions include:

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• Hole 4 - 3921 sf (add 3,930 sf) • Hole 11 - 6240 sf (add 1,600 sf) • Hole 12 - 7094 sf (add by reshaping, combining six tees into 2-4) • Hole 15 - 4782 sf (add 4,150 sf) • Hole 16 - 3921 sf (add 3,075 sf) • Hole 17 - 4953 sf (add 2,900 sf) • Hole 18 - 5849 sf (add 2,000 sf)

Growing Conditions (Shade, Drainage) – Like greens, some tees at Sportsman’s would benefit from additional clearing on NE to SE sides to increase morning sun, including tees on 4, left side of 7, back tee on 8, 9, 14 (south sun blocked), 17 and 18, (when bigger). Circulation – Paths shouldn’t be too close or too far from the tee edge, and we usually favor 25-40 feet, to keep carts on the path (rather than pulling to close) and allow enough room for foot traffic beside the tees if too close. Most tees and paths are in correct relationship at Sportsman’s. Recommendations - When cart paths are redone, we recommend:

➢ Adjustments to paths on many holes (like 2) where the path is very close to the tee. ➢ Using 4” roll curbs be used for all path (not just short stretches for parking) near tees, to keep cart traffic on the path. ➢ Even where path exists, rebuilding all path (at slightly greater cost) for a consistent look.

East 9 Construction and Materials (i.e., sand mix or other) – Built all at one time during the original 1990 construction, the East Nine tees feature more consistent 7:2:1 mix. Levelness and Turf Conditions – Similar to the Classic 18 tees, with many golfer’s complaints. While a lower priority than the Classic 18, the only correction to improve and bring consistency is to completely rebuild as explained above. Size – Overall, tee size is smaller than the Classic 18, totaling 61,000 sf over nine holes, and averaging around 6,778 sf, which is slightly smaller than desired on public courses. New forward tees, as proposed, would increase the average by 800 sf, to about 7575 sf, closer to desirable. However, like the Classic 18, some changes should be made. Par 3 tees sizes need to be 20% larger on average, to keep them in good condition, so when rebuilt, these should all size about 9,800 sf each. Actual current tee size on par 3 holes:

• Hole 3 – 3657 sf (add 6,150 sf)

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• Hole 8 – 7767 sf (add 2,000 sf)

Other tees should have the same average as the Classic 18, at 7,850 sf to equalize maintenance conditions include: • Hole 1 - 3921 sf (add 3,930 sf) • Hole 2 - 7028 sf (add 825 sf) • Hole 4 - 6148 sf (add 1700 sf (partly by adding back tee) • Hole 5 - 7004 sf (add 850 sf) • Hole 6 - 6642 sf (add 1,208 sf) • Hole 7 - 8765 sf • Hole 9 - 4771 sf (add 3,080 sf)

Growing Conditions (Shade, Drainage) – Like greens, some tees at Sportsman’s would benefit from additional clearing on NE to SE sides to increase morning sun, including tees on 2, 8 and 9. Circulation – Paths are generally closer to tees than on the Classic and have more “curves” that encourage drivers to leave the path. While serviceable, ideally, if cart paths are extended on this nine, these should be removed and replaced rather than simply over laying them in the same place. Recommendations - Same as Classic 18 Sand Bunkers Sportsman's has about 112,000 sf of sand bunkers, about average for public courses: • Classic 18 – 80 Sand Bunkers and 84,500 sf, and features a half dozen grass bunkers, and creeks or ponds affecting holes 3, 8, 10, 13, 14, 16, and 17. • East 9 – 17 Sand Bunkers, totaling 28,800 sf, and features extensive mounding, plus ponds affecting holes 1-6. There is some discussion about removing more bunkers to reduce maintenance, but we must be careful, because sand bunkers are traditionally one of the attractions of a course, and it will be difficult to reduce sand bunkering while simultaneously raising its profile in the market place. That said, we believe reducing the sand bunkers on the more heavily bunkered Classic 18 by 5-7% without affecting course perception by removing portions that aren’t visible to golfers, sand bunkers truly out of play, and ones that visually replicate others. Even as an easier course, the East 9 is slightly under bunkered, and we propose no major changes.

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Aesthetics Sportsman’s bunkers are designed in the Cape and Bay style, like Donald Ross, on the Classic, and a 1990’s version of Cape and Bay bunkers. They have decent aesthetics, with the Classic 18 bunkers better than the East Nine. Jacobson restored some of the Classic shape that had begun to evolve into simpler shapes = easier maintenance, after Northbrook acquired Sportsman’s, or they might have even more variety in shape. Maintenance Customers complain about the condition of sand bunkers. Their condition is not a result of poor maintenance, but poor construction including nearly every factor that makes bunkers deteriorate over time. Sportsman’s East was built just before bunker liners were introduced, and the Classic 18 omitted bunkers liners owing to a lower budget. The resulting construction has caused big ongoing maintenance and image concerns to this day: 1. Poor Sand Choice (in color and angularity, it cakes together) 2. Inadequate drainage, with 4” tiles only in low spots 3. The worst drainage bunkers were poorly shaped (like 5 fairway right) and allow too much overland surface water to flow into the bunker 4. Banks were originally planted in fescue, creating a shaggy look golfers dislike. One of the top renovation priorities is to improve bunkers.

Like most courses, sand bunker maintenance takes up a disproportionate amount of staff time. We propose to reduce sand bunker maintenance cost two ways: 1. By reducing total bunker area, without sacrificing reasonable challenge and aesthetics. We estimate we can reduce bunkers by 10%, or: a. Reduce to 78,750 sf on the Classic 18 b. Remain at 28,800 sf on the East Nine c. 107,550 sf in total

2. Using Sand Bunker Liners to reduce washing of sand (and a day of reshoveling) in every rain, replacement due to drainage contamination. There are two basic groups of bunker liners – Fabrics and Hard Surfaces/Soil Binders.

Fabrics - There are a few brands, such as Sand Trapper, which comes in three grades, shown below with typical installation cost for Northbrook:

• Sandtrapper I / $2.45 per sq. ft. - Slopes up to 15 degrees/26%

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• Sandtrapper MD / 2.50 per sq. ft. - Slopes up to 30 degrees/52% (45% is 1 to 1 slope) • Sandtrapper II / $2.80 per sq. ft. - Slopes up to 60 degrees/108%

For steeper applications, like Sportsman's, we propose using Sandtrapper II or equal, and fully covering your bunkers, not just the slopes (which some courses attempt to save money.) Disadvantages of fabric liners include the need to hand rake bunkers to avoid damaging the fabric. Some superintendents use mechanical rakes on the flatter portions, but most don’t take the chance. They figure that faster travel time between bunkers in a utility vehicle offsets the additional labor of hand raking. Total cost at Sportsman’s would be 107,550 sf @ $2.80/sf, or $301,140. Another high-quality fabric type is Bunker Solutions, which is basically white or buff Astroturf, chosen to match your sand color. It’s an excellent product, and flexible/durable enough to accept machine raking. Very few have chosen this method, primarily because of expense. Hard Surfaces/Soil Binders - Hard liners/Soil Binders have evolved to become the most commonly used bunker liners. The solid surface allows machine raking, a longer lifespan, better performance in most situations, and no club snagging on fabric. The current product leader is “Better Billy Bunker” now considered by most to be the “silver bullet” of bunker lining. It uses a 2” layer of “sticky gravel”, i.e., coated with a specialized polymer spray, which reminds some of Rice Krispy Treats. It hardens into a strong-but-flexible surface. Water drains through it up to 400” per hour, which reduces the erosive forces under the sand surface, while minimizing sand migration down and soil migration up, if correctly sized sand and gravel adequately “bridge” well, much like the requirements for a USGA green. In Chicago, installation runs about $3.50 per Sq. Ft. Installation requires using a “licensed” Better Billy Bunker installer which suggests completing large bunker projects at once to attain economies of scale. Most BBB installers won’t look at projects below nine holes. Sand cost varies depending on choice. White sand is preferred by golfers, but is sometimes a tough choice when finances are tight: • White Sand, like Pro Angle @ $85 per ton, and over $1.75/sf for material.

• Local buff sand, @ $45 per ton, and $1.00/sf for material.

Drainage – has been a problem at Sportsman's bunkers, and while liner reduces drainage problems, we recommend extensive in bunker drainage, and 6” over 4” for major exit pipes to increase capacity.

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• Interior Drainage – Extensive 4” dual wall drain pipe. Well drained bunkers have at least 1 L.F. per 20 sf of sand bunker, now costing about $8 L.F. in Chicago.

• Exterior Connection Drainage – Solid 6” PVC, making connection to nearby pipe, which varies, but averages 50 LF per bunker, at $10 per L.F. in Chicago.

Reshaping – To equalize the appeal of the East 9, bunkers should be reshaped to the Classic 18 style, while bunkers on the Classic 18 will need re-shaping to reduce bunker size, and make adjacent banks easier to mow. Many courses install bunker liners without changing any characteristics, but the additional costs are worth it at Sportsman's. This adds a few weeks of dozer time (At least $30,000) and sodding the banks back after reshaping, typically an area equal to the bunkers size itself. Total Estimated Cost • Classic 18 – 80 Sand Bunkers and 78,750 sf @ $9 sf = $708,750 • East 9 – 17 Sand Bunkers, totaling 28,800 sf @ $9 sf = $259,200 The total would be 107,750 sf @ $9.00, or $967,950, broken down below:

BUNKERS- 4" COMPACTED SAND DEPTH Shaping SF $0.50 Spray Weeds SF $0.30 4" Perforated Tile Spacing, (1LF/20SF) $6/L.F. SF $0.40 6" Perforated Pipe, 50 lf per bunker (1LF/20SF) $6/L.F. SF $0.05 Inspection Ports EA $0.30 Cut Bunker Edge/Prep SF $1.00 Bunker Liner (Better Billy Bunker @ $3.50) SF $3.50 Purchase Sand - Assume $90/Ton Cost x 0.02 tons/S.F. SF $1.75 Place Sand - Allow @ $0.50 SF $0.70 Sod Banks @ $0.50 SF $0.50

Total $9.00

While expensive, we expect cost savings, resulting from elimination of unscheduled wash outs of sand. Northbrook averages 70 rainy days over a six-month golf season, and if all require a 4-person crew, 8 hours each, to fix, labor adds up quickly. At $15 per hour, that comes to $480 per day. If half of the rain days require re-shoveling, the cost is $17,000. Less sand will be replaced each year, saving a similar amount.

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The cost for liners is about $302,000 for fabrics and $377,000 for Better Billy Bunker. These generate $21,120 and $26,400 in debt if financed by bonds. Total savings exceed either number, suggesting bunker liners are a worthwhile investment. White sand doubles the cost of sand replacement of current buff colored sand, and probably required Better Billy Bunker, but golfers love it and it conveys an image of an upscale course. The cost difference is about $161,625, which generates about $1,127 per year in debt. To overcome that net loss, you will need to: - Raising rates $0.05 over approximately 27,564 projected rounds on Classic 18. - Increase Rounds by just 34 rounds at average current per golfer revenues.

We propose buff sand and fabric liners in the moderate plan, and Better Billy Bunker and white sand in the maximum plan, but believe Northbrook Park District should mix and match the proposals, since white sand is a clear winner.

Cart Path Layout The existing cart paths are located primarily at greens and tees, with par 3 holes having full paths. (albeit, only gravel on hole 8 Classic) Busy public courses typically prefer “full loop” systems, continuously paved from tee to greens, which allows re-opening more quickly after rains. Larger rains can put courses out of play from ½ to 3 days. On wet days, cart traffic severely damages turf, but courses with full loop paths can limit golfers who use carts to cart paths only, allowing nearly full tee sheets vs. sparse play only by those willing to walk in wet conditions. (max 35% of players) Cart paths are particularly beneficial on courses with poor draining soils and/or flat topography (like Sportsman's and most of Chicago) which tend to stay closed longer after rains. Even when dry, Sportsman's partial path system causes maintenance problems, illustrated above. Most paths end abruptly, causing compaction and turf stress/death. These are fixed by additional gravel, constant roping, etc., costing several thousand dollars per year. A few paths curve after extending from

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The combination of partial paths and drainage issues cause significant lost revenues. Over several years, Sportsman's play logs show that course closures directly attributable to lack of cart paths average 30 days per year in- season (and probably that number again during the spring and fall). SCC averages about 381 rounds/day. Based on our survey, at least 30% of the players will not play if carts are not allowed. Using the average yield of $35.06/round in revenue, this results in a loss of $4,008 per day. In addition, another 20% or more will play, but would normally have rented a cart – a loss of $14/round or another $1,121 from these players. This results in an in-season loss of $154,000 per year. If we include off-season, the loss is at least $200,000. We suspect there are other unmeasured lost revenues, too. Golfers can become disgruntled and shift loyalties after just a few cancelled or even soggy rounds. With little floodplain, Sportsman's shouldn’t have a reputation for lost play days. There is an opportunity to help maintenance and improve your image with a better reputation for drainage, in addition to remaining open for play more often by converting your paths to a full loop system and improving drainage (covered more in the next section).

Material and Construction Most current paths are asphalt, with some gravel stretches. They appear to be of various ages, and most need re-topping and/or outright replacement. We don’t recommend saving money by partially adding/fixing the paths. The different looks of old and new is noticeable, especially if Sportsman's is trying to re-brand, raise fees, etc. We recommend either total reconstruction (which puts most of the paths on the same maintenance schedule, or at least re-topping existing path if extending paths with. Asphalt is the preferred path, used by most Midwest courses. Concrete installations are rare, with similar cost, but continuous shifting and cracking, unless heavily reinforced with steel. While many types of paths have been used, asphalt remains the primary choice. Other choices include: ➢ Porous Paving (about twice the cost of concrete) ➢ Gravel/Decomposed Granite (slightly less than asphalt).

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Porous paving, (shown at right) has seen limited use on golf courses, mostly due to cost. There is little long-term data on durability. Porous paving has been increasingly used by landscape architects in other applications as storm water runoff control has become a major design issue.

Porous paving is much greater cost – about $8 sf vs. $3.75 sf for asphalt. Porous paving should not be dismissed out of hand, as it might prove valuable in meeting strict retention and permitting guidelines, reducing detention related grading, and be reflective of Northbrook Park District’s overall mission statement. Other methods have been tried, but have never caught on, presumably for good reasons. The old driveway style reduces concrete, but golfers can’t be trusted to drive that well. Gravel often wash out and don’t look finished. They need edging and sufficient drainage to control flow. Adding plastic honeycombs hasn’t proven durable.

Traditional gravel path, with mowing and edging problems (left). On right, upgraded gravel path with stone edging, nice bridge. Gravel paths are used more often desert climates, where rain is infrequent.

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Width Existing path width is about 8 feet, which is industry standard for fairway cart paths. This closely allows two-way traffic and maintenance vehicles to get around the course. 10-12-foot-wide paths plus curbs is recommended around greens, tees and any path seeing frequent two-way cart flow. On narrower paths, golfers tend to pull just off the path, which breaks edges down and compacts soil near every green and tee, where golfers will likely notice. On narrow paths, most courses are forced to continually add gravel, pavers or cobbles in these areas, as shown below, but it can be prevented with superior design. At right, an example of golfers wearing turf by pulling one tire off the path to let others pass. Curbs Standard cart path systems on courses with play levels as high as at Sportsman's include curbs to control traffic around tees and greens, the full length of par 3 holes, plus any other area that may need it due to drainage, safety, etc. The roping and rocking of areas adjacent to tees is nearly eliminated, and well-designed curbs are an investment that typically pays back. We recommend soft 4” “roll curbs” that mowers can roll up and over, but anywhere traffic really needs restriction, we will use 6” curb, shown at left. Whether paths are asphalt or concrete, we recommend concrete curbs for strength. The curb shown at left causes drainage problems behind it, and grading must bring the turf behind the curb to top of curb level. The curb on right is beautiful, but expensive, for moderate budget courses, used only near the clubhouse or in key crossing paths, where they can be viewed several times per round.

Left – Poor construction! Curbs must be backfilled to their top for proper drainage. Long curbing is required as short, curbed parking areas tend to limit traffic, cause turf wear, and reduce effectiveness.

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Upper Right – Beautiful and Expensive, rarely worth the extra cost.

Lower Right – Curbs reduce annual expenses like roping.

High play courses require at least 150-200 LF of curb at each tee and green, plus putting green and practice areas (with gaps for ADA), totaling 6500-8,500 L.F. Curbing only short portions adjacent to tees and greens tends to concentrate foot traffic to those parking areas, and longer curbs spread wear out. There are few curbs in fairway areas, where we seek to spread cart traffic out to reduce worn paths in wide open fairways.

Design Detailed cart path design is beyond the scope of this preliminary report, but several key points should be made: ➢ Carts can be dangerous. Consider consulting your insurance carrier for advice. ➢ Drainage details make the difference. Adding a path on an existing grade requires smooth tie ins to avoid trapping water along the path. Overlaying existing path, shown below, is especially prone to this. Any cart path budget should allow 5-10% for additional drainage on, near, or under the paths. ➢ Paths require maintenance. Spending an extra $1 per sf for stronger asphalt and regular maintenance pay off long term.

Retrofitting cart paths involves restoring shoulders rather than leaving pavement exposed, and adding drainage via catch basin or slot drain in every low spot. (right) Cost and Benefits Measuring Sportsman's cart paths on the aerial photo, we determined the distances of existing path (that would require overlay), new path, widened paths, and curbs.

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Sportsman's CC Cart Path Cost Use Ex Routing Item Unit Price Classic East Clubouse Asphalt Demo, Cut New $ 1.00 10,000 $ 10,000 10,000 $ 10,000 5,000 $ 5,000 New 8 foot wide $ 3.75 107,000 $ 401,250 43,000 $ 161,250 21,500 $ 80,625 Widen to 12 $ 4.00 30,000 $ 120,000 15,000 $ 60,000 $ 86,000 Overlay Aspalt $ 1.70 90,000 $ 153,000 44,000 $ 74,800 1,000 $ 1,700 Drainage Estimate $ 0.05 227,000 $ 11,350 102,000 $ 5,100 22,500 $ 1,125 Curbs (L.F.) $ 6.25 7,000 $ 43,750 3,500 $ 21,875 1,000 $ 6,250 Total $ 739,350 $ 333,025 $ 180,700 $ 1,253,075 Porous Paving Demo $ 1.00 95,000 $ 95,000 40,000 $ 40,000 5,000 $ 5,000 New 8 foot wide $ 8.00 120,000 $ 960,000 43,000 $ 344,000 21,500 $ 172,000 Widen to 12 $ 8.00 85,000 $ 680,000 40,000 $ 320,000 21,500 $ 172,000 Drainage Estimate $ 0.05 205,000 $ 10,250 83,000 $ 4,150 17,500 $ 875 Curbs (L.F.) $ 6.25 7,000 $ 43,750 3,600 $ 22,500 1,400 $ 8,750 Total $ 1,789,000 $ 730,650 $ 358,625 $ 2,878,275

Using a similar cost benefit ratio as presented on greens reconstruction, we can evaluate the payback potential of cart paths. Over 27 holes, new asphalt cost $1,253,000, creating $87,200 annual debt vs. generating $200,000 more revenue from added rounds. We added a drainage allowance because sometimes fitting existing cart paths to existing topography without creating unforeseen drainage problems.

We believe there would be some maintenance savings about $5,000 annually from less roping off, re-sodding, etc., but also recommend an aggressive sealing program, probably offsetting any maintenance savings, making asphalt cart paths a net positive of $117,800 annually. More than enough to flip the golf division from an annual operating loss to a positive NOI. The cost of porous paving is over twice asphalt, so we didn’t analyze cost vs. benefits. We believe, based on experience, that golfers will pay a nominal additional greens and cart fees – to a reasonable amount for easily seen drainage improvements and recommend asphalt paths (new and over laying pavement) as the most cost effective option, at least until better vehicles come into mass use……

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Drainage As already mentioned, poor drainage combined with partial cart paths, costs Sportsman's 30 days of play per year. While we allocated most of that revenue lost to cart paths side of the equation, in some ways, that is treating the symptom and not the cause, as perfect drainage would eliminate much of the need for cart paths. Sportsman's is plagued with flattish topography and clay soils, not uncommon in the Chicagoland area. Fortunately, it contains very little flood plain. Thus, the entire course can drain somewhat slowly. And the design of the course has caused several specific problems including holes 13, 15, and 16 Classic. Low areas on holes 7 and others on the East 9 are also slow draining. Complete drainage design is beyond the scope of this report, and it’s also not practical because there are no as-builts of the existing drainage. Field reviews have found many catch basins, but we can’t know pipe routing, sizes, etc. In a few cases, multiple catch basins appear right next to each other, suggesting an old system was replaced with a newer one without abandoning the other. We also noticed many low areas without catch basins, and a few had old catch basins where the sod had grown over the opening, reducing function. Our recommendations for drainage include: • Commission a survey of underground drainage system including locations, construction material, and grades or all existing drain pipes. Include an estimation of condition, age, etc. • The existing crew should seek out and uncover turf covered catch basins to increase function (and help the surveyors) • Retain a golf course architect and/or engineer (not all golf architects are expert at designing drainage) to assess the system and design replacements, additions and upgrades to allow all holes at Sportsman's to drain at an equal rate. (If one hole is closed, all will be closed in many situations) A Golf Course Drainage Primer While complete drainage design is beyond the scope of this report, given its importance, I will include a few comments on the basics of golf course drainage design. ➢ Take care of surface drainage problems on the surface, with minimum surface pitch of 2-3% to catch basins or inlets, and solid (not perforated) drain pipe. The perfect time to add surface drainage is concurrent with any new irrigation systems, installing the drainage pipe first, since its design requires critical grades. Grading around an existing irrigation system is difficult, but not impossible. ➢ Take care of subsurface problems with subsurface drainage, i.e. perforated 4-6” French drains, imbedded in gravel at the seepage location and depth. Many superintendents use tile drains to correct surface problems, only because of on hand machinery but it rarely works well.

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➢ Your drainage systems won’t need to drain large storms, which keeps pipe sizes in the 6, 8, 10 and 12” range in most cases. ➢ Golf courses should drain at the same rate everywhere, since one closed hole closes all 18. That requires the designer to use drainage formula. Sophisticated engineering formulas aren’t usually necessary, and the Rational Method (Q=CIA) is sufficient to size drainage pipes in sub 100 Acre watersheds usually found on golf courses.

However, this method can under estimate run off volume, so take care to use realistic, rather than minimum values in the equation, which depends on correctly estimating “typical” run off. Runoff varies substantially between soil types, slopes, vegetative cover, and surrounding urban land use. Recent rains may have already saturated the soil, and regularly irrigated golf courses rarely have dry soils that readily accept big rains.

➢ Absent property protection, health, safety, and welfare issues, we can choose relatively small “design storm” criteria, typically designing to drain: o Every bit of nuisance water to avoid continuous wet areas and maintenance problems, etc. When cost is an issue, more catch basins and smaller pipes is often a good trade off. o As little as ¼ or ½ inch per hour rains immediately so average rains don’t delay play. o A 1-2.5” per hour storm within an hour, accepting short ponding once or twice a year is usually an acceptable compromise between revenue loss to reduce initial cost. Good environmental practice suggests short holding/ponding of 1” rains temporarily to filter and settle out golf course inputs. o A 100 year, 24-hour storm in less than 72 hours, the time span that submerged turf can die after sweltering summer rain storms. We see many mistakes made in golf course drainage design, by in house crews, and sometimes, even golf course architects. Some key factors in successful design include: Undersized Pipe – Which is a mistake for a few reasons: ➢ Value – While pipe price goes up with the diameter inch, pipe capacity rises by the square of the diameter inch (Area=π .) 8” pipe cost 25% more than 6” pipe, but carries 78% more flow to increase2 capacity cheaply. ➢ Minimum Slope –Larger pipes can be laid at 푟flatter slopes to achieve the same capacity when required. ➢ Maintenance – Large pipes are easier to clean out than small ones. ➢ Self-Maintaining System – 3 feet/second is considered self-cleansing velocity, and small pipes require steeper grade to be self-cleansing than larger ones. If your designs ignore “self-cleansing velocity”, your drainage system will require constant cleaning. There is also a maximum slope and velocity

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(usually 5-9 Foot/Second) for various pipe sizes and materials you should not exceed to avoid exit area erosion problems. Undersized Inlets – Golfers dislike seeing catch basins in play areas, but limiting size to 6-8” basins for aesthetics also severely limits drainage capacity, as catch basins are usually the limiting factor. For all but the smallest areas, we recommend larger catch basins sized similarly to pipe. Larger catch basins are also easier to clean and more resistant to reduced capacity caused by blockage by clippings Other Mistakes - Placing catch basins too close to critical areas. Water should be picked up well away from greens, tees, and hopefully, in the rough before crossing fairways (or cart paths!) In general, once drainage flow is piped, it ought to remain piped until out letting into a pond, stream (with appropriate environmental filter) or larger pipe. Ending pipe with a flared end section in golf turf leads to nothing other than soggy golf course turf…… Golf Course Drainage Costs Without a final design, estimating drainage costs is difficult and must rely on generalizations. In designing golf course systems according to guidelines above, our typical golf course spends $10,000-$15,000 per hole. We presume some of your existing drainage is to be re-used, and believe your drainage costs would be $8,000-$10,000 per hole, or including the range as two holes, about $232,000 to $290,000 for the entire complex. Parking drainage would be extra, and we have also recommended small drainage around cart paths, figured separately. Good drainage is simply essential to golf course function and turf health, to the point where estimating increases in revenue or decreases in cost becomes a moot question. Using a similar cost benefit ratio analysis for other infrastructure, and the maximum estimated drainage cost of $290,000, new drainage would create $20,000 annual debt. Having already allocated an additional $160,000 more revenue from added rounds to cart paths, we attribute only the remaining $80,000 to drainage. Cart paths stop cart rounds, but poor drainage stops even walkers. We believe there would be substantial maintenance savings by avoiding re-sodding, roping, and mowing around wet areas, which could come close to the $20,000 debt, making drainage not only a necessary investment for the golf course, but at least a break even one as well. We noted many customer complaints about drainage, and we believe poor drainage gives you a worse reputation than you deserve. Also, when poor drainage cancels scheduled tournaments, it is remembered and those tournaments often go

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Golf Operations Assessment Architect’s Report elsewhere, adding to long term revenue loss. No doubt, drainage would pay dividends. Lastly, HDPE drainage pipe, correctly installed, should last forever, and no further investment set asides should be required. However, most courses continue to add drainage most years, as it sometimes has a way of moving around. Net cost is still minimal, and can be handled within any normal maintenance budget. We have added minor drainage to the minimum plan, which is based on the Superintendent’s 2017 maintenance plan. The moderate plan includes that, and major drainage upgrades on the worst 3 holes of drainage on the Classic 18 (13, 15, 16) and one on East 9 (7). The maximum plan includes more drainage everywhere, and the latter two proposals would depend on the results of the drainage survey. Irrigation Classic-18 The irrigation system on the Classic-18 was installed in 2000 using: ➢ Rain Bird heads and central controller, ➢ New Flowtronix VFD pump station o Approximate pump capacity is 1600 GPM. o The VFD drive and the 25hp pump were replaced in 2015. ➢ Byron Jackson submersible well pump. The submersible well pump has been maintained and is in good working order, and may not need replacement as soon as other components.

Mark reports that the system is well maintained and tight, with few leaks. At age 17, this demonstrates good construction and maintenance. We expect that this irrigation system will be adequate for at least 8-13 more years, but you can expect increasing leaks moving forward. Re-construction of parts of the system will be required in any areas that require earthmoving for renovation, like tee extensions proposed in the moderate and maximum schemes presented. Installing XGD or new greens mix may cause breakage around the greens, but these are easily fixed for low cost.

The extent of work required on Classic irrigation will depend on the extent of renovations undertaken. It will also depend on your comfort levels in: ➢ The reliability of the old system (currently, not bad) ➢ Mixing old and new systems, which will have varying quality levels (we recommend building new to the highest current standards) ➢ Inconveniencing golfers one more time, i.e. renovating now and coming back in 8 years to add irrigation, inconveniencing golfers.

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While the Classic 18 irrigation system could last with partial changes/rebuilds/upgrades, if more comprehensive routing changes are implemented, reconstructing now, rather than in a few years may be wise. Play and revenue often suffer after years of constant disruption, suggesting full irrigation replacement if and when renovating other parts of the course. Further, as installing irrigation usually requires closing the course for an extended period, it would save lost revenue from having to close the course(s) down multiple times in a 10-year period. East-9 The irrigation system on the East-9 is original to the 1990 construction, 27 years old, and at, or quickly nearing, the end of its useful life of 25-30 years. Problems include: ➢ No isolation valves (which allow repairs to be made without affecting the other parts of the course) ➢ Poor/inconsistent spray patterns, ➢ Poor uniformity of coverage, water waste. ➢ Need for spot hand watering, as per above. Problem getting worse. ➢ The former will become a bigger problem as the system ages, and the latter will continue to require over watering in some spots, hand watering in others, etc., as well as generally wasting water.

Regardless of any changes to the East 9, you can anticipate totally replacing the irrigation within 3-5 years, including all sprinkler heads, pipe, valves, and satellite controllers. The pump station is in currently in good working order, offering the possibility of savings in any reconstruction. However, we may not recommend this, as: ➢ Capacity upgrades may be desired ➢ Reliability is the goal, harder to attain when running a new irrigation system with old pumps. (only as good as weakest link) ➢ Newer pump stations are more energy efficient.

Total irrigation replacement is expensive, at about $900,000 per nine holes. A new system can be installed one hole per week, in fall, allowing you to keep any nine in play, with some accommodations, if irrigation was all you needed. Attempting to keep existing irrigation nearly prevents major fairway work and any re-routing. Major changes are best done concurrently with irrigation replacement, including re-routing if desired. It is best to design all improvements as one unit. The net result is that a need for new irrigation makes extensive re-routing of the East 9 more palatable financially.

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Irrigation Ponds In Chicago, proper size for irrigation ponds is 1.5-2 acres per nine holes. The general criteria are:

• Storage pond sized for 7-10 days’ storage if wells go down • Maximum Nightly Draw Down of 6-12” to reduce need for armored lake edges (i.e., boulders, rip rap, etc.) • Depth of at least 8 feet to increase storage.

Old maps show all five small ponds on the Classic front nine connected by pipe. However, they show as 2” pipes, which are hydraulically too small to be effective at conveying water. Connector pipes also need to be very deep to maximize storage – any water below pipe level cannot flow to the irrigation lake.

Assuming the various lake connections work to make all water available to your irrigation pumps, which Mark doubts, your lakes combined are 3 surface acres, and right at minimum recommended minimum size. In addition, visual review shows them to be too shallow. Capacity is too small.

On the East 9, the irrigation pond is less than an acre, but is gravity fed from ponds above, which are fed by the deep well. Again, a small connector shows on maps, but it appears to have been replaced by a gravity flow ditch, with no advantage to the irrigation system. Capacity is too small.

Your storage lakes are fed by a deep well, built after Northbrook Park District obtained the course in about 1998. None of the old records showed with capacity in GPM, but Mark reports it is adequate now, but has mentioned need to maintain the well pumps in his management plans.

Current recommendations are for bigger storage ponds and higher GPM pump stations, which you should expect an irrigation designer to recommend a pump station larger than your existing 1600 GPM plant for the Classic 18.

The biggest driver of bigger pump stations is the shortening of the desired “irrigation water window.” When your 1990 and 2000 era systems were designed, the general thoughts were to:

• Irrigation primary areas only • Start front nine irrigation after the last tee time (about 7PM in midsummer) • Finish before mowing started at 6AM the next day) • Systems were geared to water for average summer days in 8-10 hours • On hottest days, water took 10-12 hours, accepting some play disruption • Typical Gallons Per Minute was 1250-1500 in the Midwest.

Fast forward to 2017, and things have changed: • Irrigation has expanded to roughs, clubhouse, etc.

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• Start front nine irrigation later to allow late play (about 9PM in summer) • Finish well before mowing started for better cut (about 4AM the next day) • Typical Water Window is 6-7 hours, maybe 8 hours on hottest days • Typical Gallons Per Minute is 1800-2250 in the Midwest. • Storage pond still sized for 7-10 days’ storage if wells go down

Assuming any new system for 18 holes is an 1800 GPM system, we recommend enlarging and deepening your irrigation lakes. While you are doing okay now, your reliability and ability to water as needed in the most difficult summers would be increased.

In the moderate and major plans, we have included expanded lakes. Anetsberger Anetsberger is a new system, constructed in 2007, which should have 20 more years of useful life. The only noted problem are power supply issues at the pump station – which causes system to go down. In hot weather, missing a day of watering could be disastrous, and we recommend having the power company assist with ‘cleaning up’ the power supply to the pump house. Clubhouse Your existing clubhouse has about 5,200 sf for primary golf functions, slightly above the minimum 4,000 recommended for pro shop, grill/bar, kitchen, restrooms, mechanical and storage. Your administration space and some storage and teaching is currently in a similar sized basement, which technically requires an elevator to meet ADA requirements. Any new clubhouse would need at least 4,000 sf for golf operations, including grill. Enhanced food and beverage operations could be either: • Option 1 – A la Carte menu for golfers and non-golfers’ year around, focused on lunch and dinner business, in addition to your golfer’s grill. About 2-3,000 sf of space for increased seating capacity, private meeting / dining room, and larger kitchen. • Option 2 – Banquet/Event space for golf and non-golf events. Requires additional 5-8,000 sf for additional seating capacity of 150-250, additional restrooms, alternate entry, pre-function area, and larger banquet kitchen, line service and storage. Sirius Golf Advisors is recommending 12,000 sf for total clubhouse space to accommodate its proposed program, elevated to create views, and with cart storage underneath.

Regarding potential clubhouse expansion, we have consulted local clubhouse architects, BSB Club Design, (Palatine, IL, with national experience, and with whom

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Golf Operations Assessment Architect’s Report we have worked.) They suggested that conceptual clubhouse pricing is relatively straight forward, on a square footage basis, shown in the table below: • $300 per sf of enclosed area (12,000 sf = $3,600,000) • $150 per sf of covered outside areas (patios, Porte cochere, entrances, below grade cart storage) 12,000 sf =$1,800,000 • Pro Shop Millwork - $80,000 • Kitchen Equipment - $150,000 basic package, up to $300,000. • Bar Equipment and Millwork $100,000 - $150,000 Additional Items not included above - • Demolition • Site Work • Entry Road – Varies with design, length • Entry Sign – $125,000 • Parking Lot - $6,000 per car typical in Chicago $2,250,000) • Walkways – Allow $100,000 • Cart Staging – Allow $100,000 • Landscape – 5-10% of construction, or $360,000 • Lighting - Allow $100,000 Sportsman's proposed clubhouse construction Qty Unit Unit Price Extended

Building

Basic 12,000 $ 300.00 $ 3,600,000.00

Outdoor 2,000 $ 150.00 $ 300,000.00

Mill Work 12,000 $15.00 $ 180,000.00

Bar Equip. 1 $75,000.00 $ 75,000.00

FFE 12,000 $25.00 $ 300,000.00

Kitchen Equip. 1 $ 300,000.00 $ 300,000.00

Site Work Demo 150,000 sf $ 0.50 $ 75,000.00 Entry Road 2,400 L.F. $12.00 $ 28,800.00

Entry Sign 1 $75,000.00 $ 75,000.00

Parking 325 $ 5,000.00 $ 1,625,000.00

Walkways 2,000 $ 6.00 $ 12,000.00

Landscape 12,000 $15.00 $ 180,000.00

Lighting 1 $ 100,000.00 $ 100,000.00 Construction Bid $ 6,850,800.00

10% Contingency 10% 0 $ 685,080.00

Architect, Engineers 15% $ 1,027,620.00 Total Cost $ 7,878,420.00

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Total Construction Cost - Once you add up all these elements you want to add; • 10% Design/Bid/ Construction Contingency • 12-15% Architectural / Engineering Fees Any new clubhouse would need at least 4,000 sf for golf operations, including grill. Enhanced food and beverage operations could be either: Option 1 – A la Carte menu for golfers and non-golfers’ year around, focused on lunch and dinner business, in addition to your golfer’s grill. About 2-3,000 sf of space for increased seating capacity, private meeting / dining room, and larger kitchen.

Option 2 – Banquet/Event space for golf and non-golf events. Requires additional 5-8,000 sf for additional seating capacity of 150-250, additional restrooms, alternate entry, pre-function area, and larger banquet kitchen, line service and storage. Sirius Golf Advisors is recommending 12,000 sf for total clubhouse space to accommodate its proposed program, elevated to create views, and with cart storage underneath. If the range is moved to the Classic 18/1 East 9 location for expansion capability, single point control, and elimination of nets, we recommend the final clubhouse design: • Is raised to create views, with cart storage beneath to save space • Places restaurant/banquet function areas to the west side (near existing clubhouse) to preserve existing views down 1 and 9 of Classic 18 • Places the proshop east: • To access newly designed cart staging areas • Be closer to range Cart Storage Typical cart storage area for 18 holes/60 carts is 5,000-7,500 sf, assuming 100-200 sf for cleaning and storage areas, aisles behind each cart make to operations easier, and reduce cart damage induced by tight spaces and careless/fast driving teenage cart boys, rather than “stacked parking.” At 27 holes, Sportsman's requirement will be 7,500 sf to 11,250 sf The space requirements for cart staging and golf shop/a la carte dining above are similar, and a space-efficient design would blend both levels well. Cart storage is likely to take less room than the proposed 12,000 sf for the banquet option

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Golf Operations Assessment Architect’s Report footprint. However, you can utilize part of the lower area as covered dining patio, indoor practice area (like your existing basement nets) and/or storage. Cart storage underneath the clubhouse is typical for the Chicago area, and can provide at some construction cost savings by getting two floors out of one foundation. Raising the first floor at Sportsman's, will involve some earthwork. Earth fills could come from golf course/detention pond construction if planned simultaneously. Design Recommendations Most clients prefer options, and analyzing comparative results is part of our charge. At Sportsman's, we see three generalized options for course improvements to affect revenues: Minimum Plan – Based on the Superintendent’s excellent 2017 management plan. Includes new: • Range in Place, Add 1 Ac. Turf Tee • XGD drainage for existing Classic greens • 27 New Forward Tees • Level Existing Tees • Replacing Bunker Sand, Add 4” tile • Tree Program as outlined by the Superintendent • Existing Drainage Survey and some minor drainage • Minor fairway re-grading for drainage and repair • Seal and Repair existing path in place as part of capital improvements • Purchase Portable Tee Cover • New Irrigation East 9 • Well and Pump repairs as per report • Maintenance Equipment as per report

Moderate Plan – Targeted improvements, performed mostly by contractors. Projects selected by lowest customer satisfaction and highest need infrastructure replacement items, logically deemed most effective to improve your annual operations revenues/expenses.

Your lowest ranked and highest priority items, compared to national averages:

o Design/Layout (5th percentile) o Aesthetics (6th percentile) o Greens (7th percentile) o Tees (5th percentile)

Projects include:

• Minimum plan, minus cart path sealing

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• Length - Extends 7 Classic and 3 East 9 Tees, raising length to: o Classic 18 to 6548 Yards o East 9 to 3189 Yards (without other re-routes in Major Plan) • Greens – o Classic 18 - New California o East 9 – Green remain as is, currently functional • Irrigation – o Classic 18 – Additions for Tee Extensions o East 9 - New Irrigation • New sand bunkers on all 27 holes, including: o Reshape, reduce size, fabric bunker liners, buff color sand • Cart Path - All 27 holes get asphalt cart path; ▪ New to create full loop system ▪ Over lay existing path • Driving Range – Remains in Place, o Eliminate Miniature Golf o Expand Turf Tee South o Move South Side Range Nets • Reconfigure Parking Lot closer to clubhouse, expand capacity • Add Chipping Green

Major Plan – Includes comprehensive remodel and upgrades, which typically transforms the course and re-brands it in the market. Of course, results can and do vary.

Plan includes the moderate plan, and further improvements:

• Moves range to current holes Classic 18 and East 1 o Expands Turf Tee o Can provide partial shelter o Add second short game area, private lesson tee on far end • Re-routes o Classic 18 - 3 Additional tee extensions, 5 relocated get 6667 yards o Holes 4 East 9 Holes to accommodate, keep par 35 • Greens – All 27 rebuilt to Modified California • Sand Bunkers – All 27 holes use Better Billy Bunker and white sand • Irrigation – New, all 27 holes • Drainage - More fairway drainage projects • Dredge both Classic and East Nine irrigation lakes for storage capacity

Also includes provisions for redesigning parking, shown in clubhouse estimates. Phasing Strategies There are three basic approaches to a major renovation of any course:

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1. Single Phase/Complete Renovation – Popular 1985-2000 2. Two Year Renovation – a. Complete 9 holes each in two consecutive years b. Complete 9 holes each in three consecutive years for a 27-hole course 3. Phased Renovation – Popular from WWII to 2000 a. Mid Term - 6 holes over 3 years, or tackle major areas over 3 to 5 years b. Long Term Phased Renovation – 1-2 holes (or equivalent) over 9-18 years)

While in house and phased renovations remain a large part of the renovation market, the popularity of comprehensive renovations is quickly re-establishing itself as the economy improves again, totaling over $3 Billion since the recession ended. Advantages of comprehensive renovation include: • Borrowing at low interest rates lowers annual payments to more practical levels • Baby Boomers impatient, need to see results quickly • Architectural awareness (Awards, Signature Holes, Photos affect “where to play” decisions) • Consistent levels demanded, and possible only with correct infrastructure

The major advantages to undertaking larger construction projects in one period include: • Lower construction costs from economy of scale. • The ability to “do it right” without concern for minimizing disruption/golfer inconvenience. • Construction Consistency Look/quality doesn’t vary because of different contractors. • Material Consistency – Green and Bunker sands can vary over a few years, even from the same supplier/pit. • Maintenance Consistency - Total rebuilding gives the superintendent the most consistent conditions. Three-year-old greens react quite differently (in both maintenance and play) than new greens) • More Impact upon Re-opening, as a “brand new” course worthy of playing. • Long term master plan not required, as construction typically follows closely, saving fees.

Disadvantages include: • Cost of large project, usually requiring a loan

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• Disruption/Cessation of dining room/pro shop cash flow (Not an issue at Sportsman's) • Possible loss “regulars” to other courses who don’t come back.

The advantages of Phased Renovation, if chosen, include: • Lower annual cash outlay, if kept small. • More time to raise funds via donations, assessments, partial loans in smaller increments • Properly planned and timed, cash flow disruption is minimal. • At most courses, golfers don’t mind playing one or two temporary greens

Disadvantages include: • The advantages of big projects are disadvantages for small ones, and…. • Continued Funding “Asks” • Multiple years of disruption reduces revenues/tests customer loyalty • Higher unit construction costs. In 2016, we built two greens on a project for $100,000, per green, while 18 greens averaged about $60,000 on a full project: • Less marketing impact from slow changes. • Must plan carefully to minimize course damaging and constructing some items twice.

With 27-hole courses, the most efficient method is to rebuild nine holes each over three years, leaving 18 holes open. Locally, Sunset Valley, an 18-hole course, opted for the single-phase renovation, closing this year and moving its operations and staff to Highland Park. Schaumburg, a 27-hole course currently undergoing similar renovations to what are proposed here, is opting for the phased renovations, doing 9-holes a year over a three-year period. Anetsberger Golf Course The par-3 Anetsberger Golf Course is in Techny Prairie Parks and Fields on Techny Road. The Park also contains sports fields and a large nature area. The site was formerly the factor of the Anetsberger Brothers, Inc., who began manufacturing restaurant fryers in 1937. Around 1952, the factory moved to this site, and not long after, the company built a nine-hole par 3 course for its employees to use. It was close to the current configuration. From the 1990’s, the current soccer fields contained a public driving range, which lasted until the Northbrook Park District purchased the site for a park. Baseball diamonds arrived by 1998, and soccer fields by 2007. This necessitated the closure of the range, but some of the old parking was incorporated into the design.

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The last six acres available was where old Anetsberger factory stood until recently, and is also owned by Northbrook Park District. The golf course aims to provide an opportunity for beginners to learn, families to play, or veteran golfers to sharpen their short game skills. It opened in 2006, and was designed by Rick Jacobson. One source co-credits Bob Lohmann, which was probably a result of some consulting drainage work he did for Northbrook Park District at both facilities. Anetsberger Golf Course measures 1,128 yards from the longest tees, with holes that range from 95 to 190 yards. Forward tees play from 60 to 120 yards. There is a large short game practice area that includes a putting green, chipping green, 2 bunkers, and 40 yards of fairway to work on your wedge game. The greens are bent grass and the fairways are bluegrass. The golf shop at Anetsberger is of the same date. A nice building, but with some locational problems to view and control the course. As a new course, most components are at least 20 years from requiring renovation, other than bunker sand being replaced. Few problems are reported on the golf itself, but include: • Pump station, near the 9th green, doesn’t reliably get electricity, which must be checked. • The 4th hole fairway doesn’t drain well, in part because it is also part of a wetland in the adjacent nature preserve. • The small astro-turf tee areas are worn, and should be removed, replaced with real turf. • The greens were constructed with pure sand, and drain too fast. They can be bumpy and require further top-dressing. • Lack of fencing allows walk on play without payment. Potential It is possible to move Miniature Golf to Anetsberger, if retained in Northbrook Park District Business Model. Locating it within the golf course, especially if fences are added, increases control. Alternate location is NE corner of six-acre parcel. Recommendations • Add fencing to secure property. Complete Fencing requires about 5,000 L.F. of chain link fence, but we think we can fence only the south and west reducing length to less than 3,000 L.F. With typical prices being $20 for 8- foot fence, for a total of $60-100,000.

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• Add a new modular control building (clubhouse) for better visual control of No. 1 Tee and Miniature Golf. Convert pro shop to park concessions. New generation modular buildings can be quite nice. Many budget public courses opt for such a building, sometimes combining up to six structures at larger public courses. They have lifespan of 12-15 years or more, with proper maintenance. Eventually, you may wish to convert to a more permanent facility. Size and cost vary with planned function. With food service nearby, this building would house only a small pro shop and a service counter, one office, restrooms, and a small dining area. It would cost about $300,000, if built. But it can also be leased for about $1,500/month or $18,000/year, depending on configuration and manufacturer. The proposed clubhouse would need to be only about 1,440 sf in size, with an office and storage room. This would give ample room for a counter, merchandising area and a few tables and chairs. Given the proximity to the current clubhouse, it may be possible to not have restrooms (although building regulations may require). While basic buildings can be obtained for under $100 sf, nice modular have cost up to $350,000. • Move Miniature Golf to Anetsberger, since it has been removed from Sportsman's, if retained in Parks Business Model, taking an acre from NE corner of six-acre parcel. We have located a 12,000 sf parcel, within the fence and adjacent to the new modular control building. Miniature Golf Courses, like nearly every other recreational facility, have been upgraded since the course at Sportsman's was built. Basic courses cost as low as $150,000 to $250,000, but with extensive landscaping and amenities, they can cost 2-3 times that. • Repair Pump • Remove Astroturf and Restore turf on tees, at a cost of $5000. • Continue Aerifying Greens with sand/peat mix to improve growth medium, and ongoing maintenance cost.

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Proposed Routings Moderate Plan

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Major

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This section will review the various recommendations and then make cash flow projections based on various combinations of improvements. Assumptions These projections do not consider factors such as dramatic weather changes or events or major economic shifts. However, such factors should impact each scenario equally, so the comparison across scenarios is still valid. For Scenarios 1-3, it is assumed a new Food & Beverage vendor is brought in, with a revenue-sharing lease providing 10% of the gross to NPD. It should be noted that for these scenarios, it might be prudent to offer the vendor a 5-year contract initially as three of the first four years would be construction. The projections assume 100% debt financing – using 20-year revenue bonds at 3.5% interest (which is higher than what is currently available). As discussed earlier, there are a lot of alternative financing that can be employed in lieu of debt financing, but this does provide an effective way to compare scenario performance. A couple of important notes. While in our discussion of improvements, we note potential savings, especially with regards to course maintenance, we do not include these savings in the projections. Instead, we assume that the savings would be reallocated within the department in order to improve overall course conditions, given the maintenance budget is already low. Secondly, in our customer survey, we noted that 2/3rds of the respondents were willing to pay more to help fund the improvements. But in our projections, only the major scenario reflects a higher fee structure, which is part of the rebranding and repositioning. Otherwise, the rate increases are due to inflation. Scenario Descriptions In this section, we will first review the various recommendations contained in this report. For each, we will discuss their cost and potential benefits. However, it is very true, in this case, that the sum is greater than its parts. If multiple recommendations are implemented, it should lead to a change in the image of the club that can yield far greater results than a given improvement. There are obviously an endless combination of the various renovation and operational recommendations that can be constructed. However, to give NPD a better sense of the relationship between investment and results, we have created four different scenarios with which we can analyze and perform projections. The analysis, which will be in the next section, shows the potential effect of these combinations of recommendations. • Scenario 0: Status Quo-- This scenario assumes there will be no changes, capital investment or operational

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• Scenario 1: Minimal – Some operational changes are made, but none that require additional capital outlay. Some of the most critical capital improvements are made. This can be considered the “band-aide” scenario. • Scenario 2: Moderate—Assumes all operational changes are made and a moderate amount of capital improvements. These will not include moving the range or a new clubhouse. • Scenario 3: Major - Assumes a greater investment and the maximum recommended improvements, including moving the range and a new clubhouse. East 9 Configuration When we first arrived at SCC, we felt the East 9 stuck out like a sore thumb. It did not fit in with the Classic 18. We also quickly realized the advantages of moving the range internally, maximizing what has proven to be a wonderful profit center, and improving efficiency at the same time. This meant changes would need to be made to the East 9. We looked at three options: 1. Leave as Is: Under this option, the range would not be moved and the East 9 would essentially remain as it is, as a stand-alone 9-hole course. 2. Improve to Classic Quality: As discussed previously, generally the most efficient arrangement for a 27-hole facility is to make it a “true” 27-hole facility where the three nines are interchangeable. This creates three different 18-hole (and 3 different 9-hole courses), providing the customers with greater variety and the operator maximum flexibility. But for this arrangement to work, it requires that all three nines be essentially equal in the golfer’s mind. If one is significantly different, it creates significant issues. 3. Make Executive: It was initially thought that to move the range, it would require shrinking the East 9 down to an Executive Length course. However, this seemed to be consistent with what we had understood as a goal for the golf operation, which was to offer a golf product for most market segments. The natural progression was Anetsberger, East 9 then Classic 18. Only when we looked at the East 9 as it is, we did not see a significant different to the Classic except that it was 9 holes. It was about as long, and almost as challenging, just not as well-designed (in our opinion). An Executive course, though, would clearly become a bridge course between AGC and the Classic 18. Several things have happened over the course of our investigation that have led us to recommending a modified version of Option 1. First, our analysis (and own experience) strongly suggested that the Classic 18 needed to be lengthened. Second, and most importantly, our Architect, Jeff Brauer, could create a routing plan that would preserve the East 9 as a par 35 course. However, it would not be long enough to be equivalent to the two Classic 9s, especially if the first objective of increasing the Classic 18’s length was to be obtained.

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Our market analysis suggests that while Executive courses are popular in the area, they still underperform regulation courses. A 9-hole regulation course will do better than a 9-hole executive course. Then our customer analysis clearly showed that the current players on the East 9 are already significantly different from those playing the Classic 18. Thus, changing to an Executive course would not necessarily increase the market, just change it. Further, the East 9 was already generating as many customers as the Classic 18. We do not believe it to be worth the risk of sacrificing what is already proven successful if it is not necessary. This eliminated Option 3. (The remaining benefit of shrinking East 9 down, would be to allow for a truly remarkable short-game area. And while this would be wonderful for the academy, a short-game area alone is not likely to generate nearly as much revenue as you would lose in converting the East 9 to an Executive. Plus, it would significantly increase the renovation cost. Putting these facts and observations together have led us to conclude the best option is to keep the East 9 as a stand-alone regulation 9-hole course. The scenarios below reflect this, with the main difference, as far as the East 9 goes, is making improvements to the course rather than radically altering it. Scenario 0: Status Quo This scenario assumes that nothing will change. The result is the likely degradation of conditions at all three courses, leading to customer deflections. This will be amplified by the reopening of Sunset Valley as well as recent and planned renovations at other area courses. Operational Changes None Capital Improvements None Comment Course conditions will deteriorate without greater maintenance costs due to infrastructure. Eventually, rates will fall to try and recover volume. Expenses are slashed, but these effect revenues more than the savings and the “death cycle” begins Scenario 1: Minimal This scenario relies on making a few strategic capital improvements, along with some operational changes. These changes should have an immediate positive impact. But eventually, the deferred maintenance items will win the war and conditions begin to deteriorate. It won’t happen as fast as with the status quo and it could be a good intermediate step, if major funding is anticipated later.

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Operational Changes Staff • Replace 2-3 PT Asst. Pros with one Full-time, especially when you’re able to go 12 months. • Restructure hours to reduce staff during slow periods. Save one person, 2 hr. day. • Hire more women, diversify staff. Try to recruit LPGA • Explore options to keep Assistant Pros employed 12 months without making them FT at SCC. • More emphasis on customer service/training/supervision. • Consider restructuring so that ALL staff are under Golf Division’s authority. • Hire on-site supervisor for Anetsberger Operations • Modify Permanent tee time setup o Lottery o Add open periods every third time. • Modify teetimes – make first 2 hrs. 7/8. Adds 12 more golfers/day. • Allow 9-hole play on Classic 18. • Add Footgolf to AGC. • Allow carts into parking lot • Merchandise o Improve female selection o NEW LOGO (3x shirt sales at 15% or more higher price) o Sales o Promote • Marketing o Improve website ($0 cost). o Increase budget to $25k and emphasize social networking advertising. o Rebrand with renovations, including new name. • Food and Beverage o New vendor! o Require beverage cart service. o Build bar/improve aesthetics to make it more attractive to a new vendor. o Require table service at least at peak times. o Consider revenue share lease to reduce risk to vendor. Fees • Reduce East 9 green fees • Reduce bonus schedule for Preferred Player Program to range from 10% to 40%.

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Course Maintenance • Hire additional part time worker and eliminate outside landscaping contractor. Capital Improvements SCC Golf Courses • Range in Place, Add 1 Ac. Turf Tee • XGD drainage for existing Classic 18 greens • 27 New Forward Tees • Level Existing Tees • Replacing Bunker Sand, Add 4” tile • Tree Program as outlined by the Superintendent • Existing Drainage Survey and some minor drainage • Minor fairway re-grading for drainage and repair • Repair existing path in place • Seal and Repair existing path in place as part of capital improvements • Purchase Portable Tee Cover • New Irrigation East 9 • Well and Pump repairs as per report Clubhouse • Build bar in grill area, with door into kitchen, where current service windows are located • Tear down wall between proshop and hallway • Build new proshop counter in southeast corner Anetsberger • Add fence around south and west sides of AGC Capital Improvement Costs The golf course improvements at SCC are expected to cost $1,865,100. Clubhouse improvements should cost $250,000 and AGC improvements $24,000, for a total of $2,139,000. Adding in 18% for soft costs such as design, engineering and contingency, and we have a projected cost of $2,524,138. Capital Improvements Minimum Total Unit Extensi Item Cost Units on Greens Green XGD $3.50 sf 108,000 $378,000 Green (California) $7.38 sf Green Complex $61,000 EA Tees Tee (Forward) $5,000 EA 27 27 $135,000 Tee (Level Ex) $12,500 EA 18 $0

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Capital Improvements Minimum Total Unit Extensi Item Cost Units on Tee (Back Extension) $25,000 EA - - $0 Range Tee $90,000 LS 1 $0 Fairways Fairway Grading $10,000 HL - - $0 Ponds Irrigation/Detention Pond Grading $75,000 AC - $0 Sand Bunker Buff Bunker Sand $0.80 sf 97,000 97,000 $77,600 White Bunker Sand $1.60 sf 78,750 Better Billy Bunker $3.50 sf 78,750 - Fabric Bunkers Liner $2.80 sf 78,750 - Sand Bunkers Install $3.25 sf 78,750 Sand Bunkers Shaping $0.40 EA 78,750 - Tree/Landscape Trees $50,000 LS 1 $50,000 Clearing $1,000 HL - - Landscape $1,500 HL 18 - Drainage Drainage Survey $25,000 LS 19 1 $25,000 Drainage Minor $5,000 HL 18 18 $90,000 Drainage Major $10,000 HL 18 - Turf Turf - Min Fairway/Rough $4,000 AC - 1 $4,000 Path Path Repair $0.5 sf 144,000 37,000 $18,500 Overlay Path $1.6 sf 5,400 - $0 Path New $4.8 sf 6,750 - $0 Curbs $6.0 L.F. 7,000 - $0 Irrigation $247,00 Wells, Sprinkler Repairs 0 LS 1 1 $247,000 New System $85,000 HL 18 9 $765,000 Driving Range $500,00 In Place Nets 0 LS $500,00 New Driving Range 0 LS - $0 Portable Tee Shelter $75,000 LS 1 $75,000 $700,00 Tee Shelter Structure 0 LS - $0 $200,00 Short Game 0 LS - $0 Golf Total $1,865,100 Clubhouse

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Capital Improvements Minimum Total Unit Extensi Item Cost Units on Renovating existing clubhouse $250,000 Clubhouse Total $250,000 Anetsberger Add Fencing $8.0 3,000 $24,000 Anetsberger Total $24,000 Subtotal $2,139,100 18% Soft Cost/Contingency $385,038 Grand Total w/ Inflation $2,524,138

Phasing The greens work on the Classic 18 and the irrigation work on the East 9 will both require the closing of the course. So, this project will also likely need to be phased at least over a two-year period (if the work on the East 9 can largely be done during the off-seasons), or possibly three. Construction is forecast to begin in 2019. Comment The capital improvements in this scenario are basically deferred maintenance items and are mostly to retain current customers and reduce or maintain maintenance costs. They will help performance in wet weather, but not substantially. And they will make the course nicer, but may not be enough to generate a lot of new business. The exceptions are the new forward tees and improvements to the clubhouse, both of which should serve to increase revenues. be good short-term strategy. Should boost performance over next 3-4 years. But then the deferred maintenance issues will likely begin degrading the quality of the course conditions and performance will once again start slipping. Another concern is that this plan does not address the irrigation system on the Classic 18, which is at the end of its useful life-cycle. This will result in rising repair costs and the inevitable replacement a few years down the road. Such replacement will not only cost more at that time, but will once again require closing the course, costing revenue for a two-year period. During the 3-year construction period, priority will be given to 18-hole play as it yields the most, although leagues will try to be preserved as much as possible. (On the spreadsheets, 9-hole play is indicated as “East 9” even though it may be played on the Classic 18). The new logo will dramatically improve merchandise sales of soft goods. Shirt sales are not only likely to triple in volume, but the margin should be greatly improved.

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Scenario 2: Moderate Operational Changes • All from minimum scenario • Increase marketing budget to 3% gross revenue Capital Improvements • All the ones from minimum scenario, minus cart path sealing SCC Golf • Length - Extends 7 Classic and 3 East 9 Tees, raising length to: o Classic 18 to 6,548 Yards o East 9 to 3,189 Yards (without other re-routes in Major Plan) • Greens – o Classic 18 - New California o East 9 – Green remain as is, currently functional • Irrigation – o Classic 18 – New system o East 9 - New Irrigation • New sand bunkers on all 27 holes, including: o Reshape, reduce size, fabric bunker liners, buff color sand • Expand Turf Tee, repair and move range nets • Add portable tee shelter to range • Additional Tree Work and Landscape • Additional drainage work • New Chipping Green and short game area • Cart Path - All 27 holes get asphalt cart path; ▪ New to create full loop system ▪ Over lay existing path • Driving Range – Remains in Place, o Eliminate Miniature Golf o Expand Turf Tee South o Move South Side Range Nets • Reconfigure Parking Lot closer to clubhouse, expand capacity • Add Chipping Green Anetsberger • Move miniature golf to AGC • Add modular clubhouse near 1st tee • Create small maintenance area, with on-site storage for equipment and supplies. • Add small storage for 5 carts (one for staff, four for customer rental) • Remove worn artificial turf tees and replace with natural grass

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Capital Improvement Costs The golf course improvements at SCC will cost a combined $7,245,191. The clubhouse renovations were increased to $400,000 to allow for general updating and improvements to the existing clubhouse. Anetsberger costs are $464,000. The subtotal for all construction is $8,205,159. With an 18% added for contingencies and soft costs, the projected total cost becomes $9,682,087. Capital Improvements Moderate East Nine Classic Total Total Tee Extensions Item Unit Cost Units Extension Units Extension Extension Greens Green XGD $3.50 sf Green (California) $7.38 sf - $0 130,000 $959,400 $959,400 Green Complex $61,000 EA - $0 - $0 $0 Tees Tee (Forward) $5,000 EA 27 9 $45,000 18 $90,000 $135,000 Tee (Level Ex) $12,500 EA 9 $112,500 18 $225,000 $337,500 Tee (Back Extension) $25,000 EA - 7 $175,000 $175,000 Range Tee $90,000 LS $0 1 $90,000 $90,000 Fairways Fairway Grading $10,000 HL - - $0 - $0 $0 Ponds Irrigation/Detention Pond Grading $75,000 AC - $0 - $0 $0 Sand Bunker Buff Bunker Sand $0.80 sf 97,000 28,200 $22,560 78,750 $63,000 $85,560 White Bunker Sand $1.60 sf 78,750 $0 Better Billy Bunker $3.50 sf 78,750 $0 $0 Fabric Bunkers Liner $2.80 sf 78,750 28,200 $78,960 78,750 $220,500 $299,460 Sand Bunkers Install $3.25 sf 78,750 28,200 $91,650 78,750 $255,938 $347,588 Sand Bunkers Shaping $0.40 EA 78,750 $0 Tree/Landscape Trees $50,000 LS 1 1 $50,000 $50,000 Clearing $1,000 HL - 3 $3,000 6 $6,000 $9,000 Landscape $1,500 HL 18 9 $13,500 18 $27,000 $40,500 Drainage Drainage Survey $25,000 LS 19 - $0 1 $25,000 $25,000 Drainage Minor $5,000 HL 18 8 $40,000 14 $70,000 $110,000 Drainage Major $10,000 HL 18 1 $10,000 4 $40,000 $50,000 Turf Turf - Min Fairway/Rough $4,000 AC - 1 $4,000 4 $16,000 $20,000 Path Path Repair $0.5 sf 144,000 $0 $0 $0 Overlay Path $1.6 sf 5,400 44,000 $70,400 90,000 $144,000 $214,400 Path New $4.8 sf 6,750 68,000 $323,000 157,000 $745,750 $1,068,750 Curbs $6.0 L.F. 7,000 3,500 $0 8,000 $7,000 $7,000

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Capital Improvements Moderate East Nine Classic Total Total Tee Extensions Item Unit Cost Units Extension Units Extension Extension Irrigation Wells, Sprinkler Repairs $247,000 LS 1 1 $247,000 $247,000 New System $85,000 HL 18 9 $765,000 18 $1,530,000 $2,295,000 Driving Range In Place Nets $500,000 LS - $0 1 $500,000 $500,000 New Driving Range $500,000 LS - $0 - $0 $0 Portable Tee Shelter $75,000 LS - $0 1 $75,000 $75,000 Tee Shelter Structure $700,000 LS - $0 - $0 $0 Short Game $200,000 LS - $1 1 $200,000 $200,001 Golf Total $1,826,571 $5,514,588 $7,341,159 Clubhouse Renovating existing clubhouse $400,000 New 12,000 sf clubhouse Simulators Expanded Parking Clubhouse Total $400,000 Anetsberger Add Fencing $8.0 3,000 $24,000 $24,000 Add Minigolf $300,000 Add Maint & cart storage $125,000 Site work for Modular $15,000 Anetsberger Total $464,000 Subtotal $1,826,571 $5,514,588 $8,205,159 18% Soft Cost/Contingency $0 $328,783 $0 $992,626 $1,476,929 Grand Total w/ Inflation $2,155,354 $6,507,213 $9,682,087

Phasing It is assumed construction would be over a 3-year period, starting in 2019. The range improvements would be done the first year, along with the East 9. The miniature golf would be moved to AGC for 2019, which is when the new modular clubhouse would be installed. Comments This plan addresses all the main infrastructure concerns. The main one not addressed is the clubhouse. The other major elements, such as greens, tees, irrigation, drainage, should be good for another 20 years. The improvements to the range and short-game area will impact both range and academy revenue. Adding the mini-golf to AGC should significantly help the performance of both, while the modular clubhouse at AGC will improve course control. Adding carts to AGC will also improve revenue, while the storage areas will help reduce maintenance costs. With the modular clubhouse and the addition of

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Golf Operations Assessment Projections miniature golf, merchandise revenues, which will include more snacks and beverages, should go up dramatically. Adding length to the Classic 18 will greatly expand the market. And the new greens on the Classic 18, as well as all new bunkers throughout will really help with the golfing experience. However, these improvements will not change the market position of the facility, just improve performance. With the new play coming in, we expect a slightly higher yield as there should be more non-residents. We also expect a trend towards greater cart ridership, especially on the Classic 18. Scenario 3: Major In this scenario, major changes are made to Sportsman’s. The range is moved so that it is near the clubhouse and surrounded by golf course instead of concrete. More improvements are made to both the Classic 18 and East 9. But the most salient change is a new 12,000 sf clubhouse, with a nice restaurant and banquet facility. The new clubhouse not only provides a major new profit center (banquets) and allows for a more successful recruitment of lucrative tournaments to the course, but it also helps improve efficiencies with cart storage underneath and eliminates the need for a range building. Perhaps more importantly, it makes SCC into a 12- month facility, not just for the restaurant and banquets, but golf as well through heated stalls, indoor training and simulators. The improvements, taken together, will dramatically reshape the image of SCC. This will not only improve performance, but it should allow the facility to be repositioned in the marketplace with a higher fee structure and a better yield. Marketing/Operational The two biggest changes are rebranding of the facility and making it into a 12- month operation. Recommended rebranding strategy would include a new name, logo, and market position. The restaurant and banquet facility alone, would make this a 12-month facility. However, the indoor training center and simulators, as well as heated bays on the range, will also allow for a 12-month golf operation, including the Academy. With the move of the range, we are eliminating the range house. This saves $25,000/year in labor. Capital Improvements Golf • Moves range to current holes Classic 18 and East 1 o Expands Turf Tee o Can provide partial shelter o Add second short game area, private lesson tee on far end o Add heated/covered hitting bays. • Re-routes

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o Classic 18 - 3 Additional tee extensions, 5 relocated get 6,667 yards o Reroute four East Nine Holes to accommodate, keep par 35 • Greens – All 27 rebuilt to Modified California • Sand Bunkers – All 27 holes use Better Billy Bunker liner, with white sand on Classic 18, buff on the East 9. • Irrigation – New, all 27 holes • Drainage - More fairway drainage projects • Dredge both Classic and East Nine irrigation lakes for storage capacity Clubhouse A new 12,000 sf clubhouse (one-floor) will be built. Underneath the 12,000 sf main floor will be cart storage and an indoor golf training center. The clubhouse will include: • Banquet room large enough to handle at least 200 people. The room should be able to be subdivided into at least two smaller rooms, making it easier to host smaller events or to host two small events simultaneously. • Commercial kitchen • Bar area, configured like a sports bar • Table service dining room with a capacity of 65 or so. • Private dining room, capable of seating 25-40. • Bridal changing room • Five offices for management • Have a large deck

The main floor of the clubhouse will be elevated with respect to the golf course, allowing for nicer views. Parking The Parking lot will be reconfigured. The greenspace and retention pond will be removed and the lot extended to 325 spaces. This will allow for more convenient parking close to the clubhouse, essential for the restaurant. (We recommend some of the spaces be reserved for restaurant service only). AGC Same as for Moderate. Capital Improvement Cost With new greens, tees and bunkers as well as new irrigation, the golf course costs will be $10,060,603. The clubhouse and parking’s projected cost is $6,950,800. The total construction costs are anticipated to be $17,475,403. Adding soft costs yields a grand total investment of $20,620,975. The details can be seen in the table below.

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Capital Improvements Major Total Move Range, Re-routes Unit Extensi Extensi Extensio Item Cost Units on Units on n Greens Green XGD $3.50 sf Green (California) $7.38 sf 60,000 $442,800 130,000 $959,400 $1,402,200 Green Complex $61,000 EA 4 $244,000 4 $244,000 $488,000 Tees Tee (Forward) $5,000 EA 27 9 $45,000 18 $90,000 $135,000 Tee (Level Ex) $12,500 EA 9 $112,500 18 $225,000 $337,500 Tee (Back Extension) $25,000 EA - 3 $75,000 10 $250,000 $325,000 Range Tee $90,000 LS - $0 1 $90,000 $90,000 Fairways Fairway Grading $10,000 HL - 4 $40,000 1 $10,000 $50,000 Ponds Irrigation/Detent ion Pond Grading $75,000 AC 3 $187,500 1 $75,000 $262,500 Sand Bunker Buff Bunker Sand $0.80 sf 97,000 28,200 $22,560 $22,560 White Bunker Sand $1.60 sf 78,750 78,750 $126,000 $126,000 Better Billy Bunker $3.50 sf 78,750 28,200 $98,700 78,750 $275,625 $374,325 Fabric Bunkers Liner $2.80 sf 78,750 $0 $0 Sand Bunkers Install $3.25 sf 78,750 28,200 $91,650 78,750 $255,938 $347,588 Sand Bunkers Shaping $0.40 EA 78,750 28,200 $11,280 78,750 $31,500 $42,780 Tree/Landscape Trees $50,000 LS 1 1 $50,000 $50,000 Clearing $1,000 HL - 3 $3,000 10 $10,000 $13,000 Landscape $1,500 HL 18 9 $13,500 18 $27,000 $40,500 Drainage Drainage Survey $25,000 LS 19 - $0 1 $25,000 $25,000 Drainage Minor $5,000 HL 18 7 $35,000 12 $60,000 $95,000 Drainage Major $10,000 HL 18 2 $20,000 6 $60,000 $80,000 Turf - Turf - Min Fairway/Rough $4,000 AC - 4 $16,000 4 $16,000 $32,000 Path Path Repair $0.5 sf 144,000 - $0 - $0 $0 Overlay Path $1.6 sf 5,400 44,000 $70,400 90,000 $144,000 $214,400 $1,173,25 Path New $4.8 sf 6,750 68,000 $323,000 247,000 0 $1,496,250 Curbs $6.0 L.F. 7,000 3,500 $21,000 8,000 $48,000 $69,000 Irrigation $247,00 Wells, Sprinkler Repairs 0 LS 1 1 $247,000 $247,000 $1,530,00 New System $85,000 HL 18 9 $765,000 18 0 $2,295,000

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Capital Improvements Major Total Move Range, Re-routes Unit Extensi Extensi Extensio Item Cost Units on Units on n Driving Range $500,00 In Place Nets 0 LS $0 - $0 $0 $500,00 New Driving Range 0 LS $0 1 $500,000 $500,000 Portable Tee Shelter $75,000 LS - $0 - $0 $700,00 Tee Shelter Structure 0 LS - $0 1 $700,000 $700,000 $200,00 Short Game 0 LS - $0 1 $200,000 $200,000 Golf Total $2,884,890 $7,175,713 $10,060,603 Clubhouse Renovating existing clubhouse New 12,000 sf clubhouse $4,755,000 Simulators $100,000 Expanded Parking $2,095,800 Clubhouse Total $6,950,800 Anetsberger Add Fencing $8.0 3,000 $24,000 $24,000 Add Minigolf $300,000 Add Maint & cart storage $125,000 Site work for Modular $15,000 Anetsberger Total $464,000 Subtotal $2,884,890 $7,175,713 $17,475,403 18% Soft $1,291,62 Cost/Contingency $0 $519,280 $0 8 $3,145,572 Grand Total w/ Inflation $3,404,170 $8,467,341 $20,620,975

Phasing • New clubhouse to open in 2022, with the rest of the new facility.

The phasing will be the same as for the Moderate. With the East 9 and new range being completed first. This will allow for continuous range operations and a better 18-hole configuration during the construction period. The new clubhouse should open in conjunction with the completion of the golf course in 2022; allowing for a rebranding and major grand opening celebration. Comments This plan presents a completely new image for Sportsman’s, presenting an opportunity to not only rebrand the facility, but also reposition it in the marketplace. Not only will the greatly extend its market reach, but will also be more consistent with the image of Northbrook.

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We anticipate that the restaurant and banquet facility will be an enormous success, given the facility’s prime location and the success seen at other area courses with high-quality restaurant/banquet operations. The 12-month golf operation will also enable SCC to more successfully recruit and retain high-quality professional staff, further improving operations and customer satisfaction. Scenario 0: Status Quo Detailed projections can be found in Appendix G. SCC Rounds We expect that the opening of Sunset Valley will affect performance at SCC. This will likely cancel out the gain in performance we are expecting to see this year. Rounds should decrease marginally over the next few years. However, the pace will quicken as conditions worsen due to the overlooked deteriorating infrastructure. The likely outcome will be a mandatory reduction in expenses to compensate for the declining revenues. Unfortunately, these reductions typically result in even worse conditions resulting in an even greater decline in revenues. By 2022, combined rounds on the two SCC courses are projected to drop to 51,984. By 2027, the rounds are expected to total only 44,870. Revenue Revenue shall hold steady and even increase slightly over the first five years as the yield increases marginally on golf and the academy and range continue to do well. But then declining rounds on SCC will lead to decreased fees and a shrinking yield, meaning revenue starts declining at a more rapid rate than rounds. Gross Revenue in 2018 should be about $2,819,000, with $2,015,000 from SCC golf, $263,000 in range, $377,000 from the Academy, $24,000 from mini-golf, and $120,000 from AGC. Total revenue should reach $2,885,000 in 2020 before declining slightly to $2,807,000 in 2022. It then falls to $2,789,000 in 2024 and $2,606,000 in 2027. Revenue over the next 10 years is expected to total $27,419,000. Deducting cost-of-sales yields a 10-year total for Gross Profit of $23,921,000. Expenses Most expenses in golf are fixed. That is, they do not vary with volume. But they will go up with inflation. That is why we expect that expenses will continue to increase even though volume is declining. Expenses in 2018 are projected at $2,538,000, with SCC golf leading the way at $1,430,000, followed by Division expenses at $817,000 and the Academy at $130,000. By 2022, expenses reach $2,679,000, and $2,786,000 in 2027. The ten-year total is $26,710,000.

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Net Operating Income Net Operating Income starts at ($66,700) in 2018, and then starts to slide. It reaches ($225,500) by 2022 and ($604,000) by 2027. The 10-year total is projected at ($2,789,000). Status Quo $3,000,000

$2,500,000

$2,000,000

$1,500,000

$1,000,000

$500,000

$0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($500,000)

($1,000,000)

Gross Profit Total Expenses NOI

Cash Flow In addition to the operating expenses, there are also capital expenses – such as for equipment purchases and minor capital improvements. Over the past four years, these have averaged $276,000 per year. For our projections, we will assume $280,000 in year 2018, then going up 2% per year. The capital expenses should be the same in each scenario. When we subtract the capital expenses from the NOI, we have a negative cash flow of ($346,500) in 2018. This will continue to decline, reaching ($939,000) by 2027. For the 10-year period, the Cash Flow is expected to total ($5,854,751). Scenario 1: Minimum This scenario addresses the worst of the deferred maintenance items. It also seeks to expand market share, primarily by installing new forward tees on both SCC courses. It will also benefit from the recommended operational changes. It is important to note that instead of taking maintenance cost savings created by various improvements in this and the other scenarios and reflecting a lower maintenance budget, we have assumed that these savings would be reapplied in other areas, allowing for a general improvement to course conditions. As noted previously, the maintenance budget is already low for a premium facility.

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It is also important to note that while we are projecting out only 10 years, we do expect that another round of major capital improvements, would be necessary at least by the end of the 10-year period. These improvements are not included in the projections. SCC Rounds Rounds should increase significantly in 2018, with the shorter forward tees and increased marketing. We are anticipating 58,426. Rounds will be down the next three years as construction closes nine holes for much of the playing season each year. The loss will be greater for 9-hole play as the natural priority will be to preserve the more lucrative 18-hole play. We do expect most of the leagues to be accommodated during this period. But in 2022, when it goes back to 27 holes, projected rounds reach 61,500, still pretty evenly distributed between the two courses. Rounds will likely peak in 2023 at 61,808, at which point they will start to decline again as the conditions not addressed start having an increasingly negative effect. We also anticipate more of the competition going through renovations and having a negative impact. Revenue Range revenue will be impacted in 2019 as it is partially closed for renovations, but it will jump back up to $306,000 in 2020. Golf revenues are also down during the three-year construction period. We do not expect Academy revenue to be affected by the construction except in the first year, when the range is closed for part of the year. We are anticipating continued growth with the academy. Total revenue will increase annually, reaching $3,482,000 by 2023. It will then fall slowly to $3,333,000 by 2027. Over the 10-year period, revenue is expected to total $30,554,000. After cost-of-sales is deducted, the 10-year total for Gross Profit is $26,236,000. Expenses Expenses will decline during construction, but not as much as revenue. Over the 1st five years, expenses are projected to total $13,013,000. Unlike revenue, expenses continue to increase, reaching $2,930,000 in 2027, with a 10-year total of $27,324,000. Net Operating Income 2018 should produce a positive NOI of $53,000. This will fall sharply during construction, with an average loss of $554,000 per year. However, with all 27- holes open, 2022 is expected to generate a positive NOI of $177,000. NOI increases to $189,000 the following year, before retreating. By 2027, it is back in the negative column at ($81,000). The 10-year NOI is expected to total ($1,088,000).

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Cash Flow Assuming the construction costs of $2,524,138 is 100% debt financed at 3.5% interest over 20 years, the debt service will be ($177,601). Subtracting this and the capital expenses from the NOI gives us a negative cash flow of ($3,601,000) over the first five years. Cash flow improves in 2023 ($298,000), but then becomes more negative over the next five. Over the 10-year period, the cash flow totals ($5,752,000). This is still $102,000 better than the do-nothing scenario. Over the last 5-year period (2023-27), it outperforms the status-quo by $1,634,000.

Minimum $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($500,000) ($1,000,000) ($1,500,000)

Gross Profit Total Expenses Net Operating Income

Scenario 2: Moderate With the Moderate, we are spending more to improve infrastructure as well as improve market share. We do not anticipate any decline in performance over the next 20 years. Indeed, performance should continue to improve. And, unlike the Minimum, this scenario also addresses acute needs at AGC. Performance will be better as well during the construction period, due both to better marketing and to the fact that in 2020 and 2021, the product will be better. Rounds Rounds start off better, as the advertising budget is higher than either the Status Quo or Minimum scenarios. As with the Minimum, SCC will suffer rounds loss during the three-year construction period. However, when it reopens, performance will be even better. We anticipate 64,000 rounds at SCC in 2022. This will continue to increase gradually, reaching 66,453 by 2027. The split between Classic 18 and East 9 will start to move more in Classic 18’s favor. The 10-year total for the two courses is projected to 559,119.

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AGC will also see a significant improvement in performance, jumping from under 11,000 last year, to 14,689 in 2019, when the addition of the miniature golf should help both. We expect continued robust growth for AGC, reaching over 18,000 rounds by 2025. Revenue Not only will revenue go up with the increase in play at SCC, but we also expect an increase in yield as more non-locals play the course. This should also increase cart yield. Miniature golf should receive a strong boost in revenue, going from $25,000 at SCC to a conservatively estimated $85,000 in 2020. Total revenue will reach $3,955,000 in 2022. It continues to increase gradually, reaching $4,484,000 in 2027. The 10-year total is projected at $36,259,000, over $7,000,000 more than the Status Quo scenario. When cost-of-sales is included, the 10-year total for Gross Profit is $30,996,000. Expenses Expenses for 2022 are projected at $2,897,000. Expenses will rise to $3,167,000 in 2027. Over the 10-year period, expenses total $28,623,000. Net Operating Income We project a positive NOI for 2018 of $29,500. During the three-year construction phase, the NOI will average a loss of ($361,00). NOI jumps to a positive $494,000 post-construction in 2022. NOI continues to increase. Over the next five years, NOI will total $2,976,000. For the 10-year period, despite the loss during construction, the cumulative NOI is projected to be $2,418,000. This is over $5,000,000 better than the Status Quo and $1,700,000 better than the Minimal.

Moderate $4,500,000 $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $0 ($500,000) 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($1,000,000)

Gross Profit Total Expenses Net Operating Income

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Cash Flow The planned improvements in this scenario are expected to cost $9,682,087. If completely debt financed, the payments are expected to be $681,242. Assuming debt payments are made through the construction period, this will result in a negative cash flow of ($4,741,000) over the first five years, including capital expenses. Cash flow never does reach positive numbers, although it does continue to improve. By 2027, it reaches ($347,000). The 10-year total is a ($6,779,000) loss. This is nearly a million dollars worse than the Status Quo. But if we look at the last five years, the cash flow is ($2,038,000), or $1,748,00 better than the Status Quo and $110,000 better than the Minimal. Scenario 3: Major This can be considered the “all-in” scenario, even though we are not calling for a complete renovation or rerouting of the facilities. But, with the improvements to the courses, the move of the range and the new clubhouse, it does allow the facility to be rebranded and repositioned in the marketplace. This should not only improve rounds, but also the yield per round. Rounds Upon reopening in 2022, we project SCC will do 68,125 rounds. Rounds will increase each year at a gradual pace, reaching 71,116 in 2027, where it should level off. As with the Moderate, the Classic 18 will benefit more than the East 9. The 10-year total for rounds is 592,083. Revenue Revenue during the construction period is helped significantly by the new range, opening in 2020. This will add more revenue to the range from warm-up balls, as well as during inclement weather. Similarly, the academy will greatly benefit from the heated/covered stalls and the ability to go year-round. Total revenue in 2022 projects at $5,050,000. Of this, $3,609,000 comes from SCC. This includes $298,000 in revenue from food & beverage based on 10% of the expected gross revenue of $2,980,000 from restaurant and banquet sales. The new range will start producing immediately, beginning in 2020, with over $400,000 in revenue. The academy benefits first from the new range (increasing revenue to $410,000 in 2020) and then from the new clubhouse and indoor training facility (up to around $638,000 in 2022). Total revenue for the first 5 years is projected to be $16,478,000. But for the next five years, this jumps to $27,830,000. Over 10-years, this totals $44,308,000. Expenses This revenue jumps in this scenario, expenses do not. We do anticipate spending more on course maintenance to achieve a higher standard as we apply the maintenance savings from the capital improvement back into the maintenance

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Golf Operations Assessment Projections budget to improve overall conditions. But most of the other expenses are like what they are in previous scenarios. Indeed, some may go down as efficiencies are gained by moving the range, eliminating the range house, and moving the cart barn under the clubhouse. And because we assume F&B is leased out, we are generating revenue with no additional expense. The larger clubhouse will increase utility costs, but because of much greater efficiency with modern systems, it should not go up drastically (about 25%). For 2022, the first year with the renovated facility, expenses are projected at just over $3,107,000. These will increase gradually to $3,442,000 by 2027. The 10- year total projects at $30,024,000. Net Operating Income During the first year of construction (2019), NOI takes a huge hit due to the closing of the range and resulting reduce revenue from the Academy. The NOI in 2019 is expected to be ($834,000). However, with the new range and improved 18-holes of play, we are anticipating the next two years to be above break-even. In the first year with the new clubhouse, we expect a positive NOI of $1,187,000. This more than negates the negative NOI during the construction years, with a combined NOI of $523,000 for the first five years. NOI improves to $1,560,000 in 2027. The 2nd 5-year period has a combined NOI of $7,176,000, with a 10-year total of $7,700,000. This is nearly $10 ½ million more than the Status Quo, $5,200,000 better than the Moderate and $8,700,000 better than the Minimal.

Major $6,000,000

$5,000,000

$4,000,000

$3,000,000

$2,000,000

$1,000,000

$0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($1,000,000)

($2,000,000)

Gross Profit Total Expenses Net Operating Income Cash Flow The projected costs for these improvements is $20,620,975, which carries a debt service of ($1,450,914). This yields a negative cash flow for the first five years of

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Golf Operations Assessment Projections just under $6,000,000. For 2022, the cash flow is a negative ($567,000). However, this improves each year. Cash flow improves each year, reaching ($225,000) by 2027. For the total 2nd five-year period, the cash flow totals a negative ($1,697,000). For the 10-year total, the cash flow totals a negative ($8,434,000). Comparison The table below compares the performance of the four scenarios on rounds, revenue, expenses, NOI and cash flow. We pick two key years, 2022 and 2027. 2022 is right after the facility reopens after renovations, and 2027 is the last year of the projection period. We also look at the subtotals for the first five years, second five years and total for the 10-years. On initial inspection, the Minimal scenario seems to be the winner. It produces the best cash flow over the 10-year period. And the Major appears worst, as it had the worst cash-flow over that time frame. But appearances can be deceiving. At the end of the 10-year period, if not before, the Minimal scenario will require another round of major renovations, including new irrigation and greens on the Classic 18. This will again result in closing the course, presumably over a three-year period. Not only will this be extremely costly, but it will also disrupt play substantially so soon after the previous construction.

Cash Flow $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 ($500,000)

($1,000,000)

($1,500,000)

($2,000,000)

($2,500,000)

($3,000,000)

Status Quo Minimum Moderate Major

Perhaps the key number to look at is the performance in year 10. The Major scenario is the only scenario to be close to breaking even in year 10 when capital expenses and debt service are included. Presumably, it will have a positive cash flow over the following 10-years. Thus, if we were to look at an extended 20-year period, the Major would be the winner, and by a considerable margin.

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Scenario Comparison Scenario Comparison 2022 2018-22 2027 2023-27 Dif from Dif from total SQ total Dif from SQ total SQ total Dif from SQ to

84 271,022 44,870 238,663 509,685 00 9,516 223,632 (47,389) 57,009 12,139 296,921 58,258 520,553 00 12,016 231,801 (39,221) 66,453 21,583 327,319 88,656 559,119 25 16,141 241,835 (29,187) 71,116 26,246 350,248 111,585 592,083

$1,987,256 $10,119,407 $1,719,975 $9,159,725 $2,517,774 $530,518 $9,436,141 ($683,266) $2,367,688 $647,713 $12,346,107 $3,186,382 $2,679,936 $692,680 $9,851,118 ($268,289) $3,084,571 $1,364,596 $36,258,992 $27,099,267 $3,609,047 $1,621,791 $11,077,612 $958,205 $4,251,522 $2,531,546 $20,042,572 $10,882,847

$2,453,133 $12,438,679 $2,182,308 $11,482,300 $2,959,171 $506,038 $11,578,702 ($859,977) $2,848,373 $666,065 $14,656,964 $3,174,665 $3,381,573 $928,440 $12,750,297 $311,618 $3,835,806 $1,653,498 $18,246,177 $6,763,877 $4,293,804 $1,840,672 $14,017,978 $1,579,299 $5,001,838 $2,819,529 $23,705,574 $12,223,275

$1,519,671 $7,384,184 $1,562,017 $7,669,264 $1,581,527 $61,856 $7,238,657 ($145,527) $1,645,106 $83,089 $8,061,690 $392,426 $1,599,224 $79,553 $7,256,355 ($127,829) $1,720,438 $158,421 $8,296,024 $626,760 $1,705,239 $185,568 $7,372,002 ($12,183) $1,886,748 $324,731 $9,049,424 $1,380,160

$2,678,637 $13,050,731 $2,786,620 $13,659,076 $2,781,885 $103,248 $13,012,639 ($38,092) $2,929,348 $142,727 $14,311,456 $652,380

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Scenario Comparison 2022 2018-22 2027 2023-27 Dif from Dif from total SQ total Dif from SQ total SQ total Dif from SQ to $2,887,609 $208,973 $13,309,021 $258,290 $3,167,289 $380,669 $15,269,289 $1,610,213 $3,107,039 $428,402 $13,494,524 $443,793 $3,441,581 $654,960 $16,529,306 $2,870,230

($225,504) ($612,052) ($604,312) ($2,176,777) $177,286 $402,790 ($1,433,937) ($821,885) ($80,974) $523,338 $345,509 $2,522,285 $493,963 $719,467 ($558,724) $53,328 $668,517 $1,272,829 $2,976,888 $5,153,664 $1,186,765 $1,412,270 $523,453 $1,135,506 $1,560,257 $2,164,569 $7,176,268 $9,353,045

($346,546) ($2,069,184) ($938,938) ($3,785,567) ($303,396) $43,150 ($3,601,473) ($1,532,289) ($593,201) $345,736 ($2,151,287) $1,634,280 ($490,360) ($143,814) ($4,740,824) ($2,671,640) ($347,351) $591,587 ($2,038,113) $1,747,454 ($567,230) ($220,684) ($6,737,334) ($4,668,150) ($225,283) $713,655 ($1,697,037) $2,088,530

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As noted earlier, in the highly competitive market that you’re in, being good is not good enough. SCC currently has significant disadvantages with regards to the competition. And the gap is going to widen with the reopening of Sunset Valley and Schaumberg. Moreover, the deferred maintenance issues are going to continue to plague the operation, with their impact only growing worse over time. This will not only increase operating costs, but have a negative impact on revenue as well. So, the question really is not if there is a need for renovations, but “how much?” If we look at just a 10-year period, the winning scenario is Minimum. As the table below shows, it is the only scenario that produces a better cash-flow over the 10- year period than the status quo. But if we look beyond 10 years, the situation changes completely. Over the 2nd five-year period, we see cash flow steadily decreasing over these five years for both the Status Quo and Minimum Scenarios. But it is steadily improving for both Moderate and Major. When we look at year 10, which is 2027, we see the Major Scenario outperforming the other three by a considerable margin, with Moderate doing better than Minimum. It is reasonable to assume that over a 20-year period, the Major scenario will outperform the other three. Both the Major Cash Flow and Moderate scenarios also $500,000 have another big advantage over $0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 the other two. ($500,000) The improvements ($1,000,000) made should cover all major ($1,500,000) capital improvement ($2,000,000) needs for the next 20 years. ($2,500,000) With the others, Status Quo Minimum Moderate Major additional investment will be needed during this period. This represents a clear case of “pay me now or pay me later.” Of course, the four scenarios are not the only possibilities. Indeed, there are an endless number of combination of improvements that can be made. For example, we talked about how we believe almost all the new clubhouse can be paid for,

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Golf Operations Assessment Discussion without considering its impact on the overall image. Thus, combining a new clubhouse with either the Minimum or Moderate scenarios can make sense. Nor does that clubhouse need to be 12,000 sf in size. It may be possible that a smaller clubhouse will do almost as well, saving 10-15% of the cost. We also discussed how other improvements are easy to cost-justify. Extending the cart paths, alone, will not only pay for itself, but by itself can make the difference between operating at a loss and operating at a profit. Adding length to the Classic 18 and new forward tees to both Classic 18 and East 9 will also not only have an immediate impact, but will more than pay for themselves by bringing in new golfers. Fixing the drainage will also likely more than pay for itself, by allowing the course to remain open when it currently cannot, and by improved playing conditions when it is open. It can be harder to cost-justify improvements such as fixing the greens, bunker and irrigation as they are all part of the overall golf experience and thus harder to measure their individual impact. But clearly, they are the subject of significant customer dissatisfaction, so it can be easily assumed that fixing them will lead to greater customer satisfaction, which, in turn, should both increase repeat play and spur new play as the course’s reputation steadily improves. We also believe that moving the range makes a lot of sense. It eliminates the necessity of manning a separate building. It allows for a greatly improved range, with more tees, grass tees, and target greens. It is convenient to the clubhouse, which will increase usage from golfers also playing the course, and greatly improve operating efficiency. Plus adding heated/covered stalls, plus an indoor training center, either as part of the range improvements or a new clubhouse, will have a strong beneficial impact to the Academy, which is already a star performer within the operation. At the same time, bringing parking closer to the clubhouse will improve the image and customer convenience. It is also essential to generating outside business opportunities for the clubhouse and food and beverage operations. Both a new clubhouse and indoor training facilities will also enable SCC to become a 12-month facility, which will provide a better service to the community. It will also enhance revenue opportunities and allow for recruitment and retention of quality staff. Moving the miniature golf from SCC to AGC also makes a lot of sense as it improves both facilities. The market at AGC is much more consistent with the market for miniature golf than that at SCC, and the move should be good for both AGC and miniature golf. We also recommend that rebranding would be wise with any of the three improvement scenarios, but not repositioning. That is only advisable with the major.

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Return on Investment There are several ways in which to look at the return on investment. We will focus on two: Net Present Value and Total Return. Net Present Value With Net Present Value, we are looking at the present value of a future cash flow based on an assumed discounted rate. In our calculations, we are using a discount rate of 2% and comparing the differences on Net Operating Income, based on a cash investment equal to the construction cost. We then calculated the return on investment based on comparison to the Status Quo. Net Present Value Construction Total ROI 10 Annual ROI Cost NPV 10 yr Yr 10 Yr Status Quo 0 ($2,367,675) Minimal $2,524,138 $1,440,669 150.9% 15.1% Moderate $9,682,087 $11,435,593 142.6% 14.3%

Major $20,620,975 $25,740,432 136.3% 13.6% All three improvement scenarios show a significant rate of return compared to the status quo. And while the minimum shows the best, this again is misleading as it does not reflect the probability of needing additional capital improvements after 10 years. If we look just at the improvement in Net Present Value compared to cost, the Major scenario shows the best return, with a 24.8% improvement relative to the investment. Moderate is next with an 18.1% gain. The Minimum, however, shows a loss of 42.9%. Total Return In our total return analysis, we are looking at two factors: the differences in cash flow between the four scenarios and the change in market value. As a golf course broker, we can provide an estimate of market value based on remaining a golf operation. This does not include highest and best usage analysis, but assumes the operations are sold with the restriction that they must remain golf courses. In today’s market, the value of golf courses is determined largely by financial performance. The two main formulas used are a multiple of gross revenue and a multiple of Net Operating Income. For gross revenue, the multiple ranges from .8 to 1.2, depending on location, etc. We will use 1.0. For the NOI, the multiple ranges from 8 to 12 times. We will use 10x in our analysis.

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Total Return Current MV 10 year rev 10 yr NOI Best Total Return Status Quo $3,189,621 $2,522,057 ($6,043,119) $2,522,057 ($6,522,314) Minimal $3,189,621 $3,333,333 ($809,743) $3,333,333 ($5,609,048) Moderate $3,189,621 $4,484,761 $6,685,169 $6,685,169 ($3,283,389) Major $3,189,621 $5,867,671 $15,602,571 $15,602,571 $3,978,579 The “Best” column above refers to the highest market value based on the two formulas. The current market value is estimated at $3,190,000. Under the Status Quo scenario, this will decrease to $2,522,000 by 2027. On the other hand, the Major scenario shows a 2027 value of $15,602,000. When we add in the combined cash flow (which includes debt financing and capital expenses), we see that the major scenario is the only scenario showing a positive total return.

We feel the Major Scenario best fits NPD’s long-term goals and financial outlook for the operation.

Alternate Funding In our analysis, we assumed 100% debt financing, using revenue bonds with the debt being paid off through cash flow. However, this is far from the only means of financing the project. And to the degree alternative financing can be applied, the more and more attractive the Moderate and Major scenarios become. Below is a discussion on the various sources that can be used for funding. However, as we will see, the issue of how the improvements are paid for and how the facilities are managed are not independent questions. Indeed, they are very closely related as some of the financing options have a direct impact on the nature of any management or lease contract with the operator. Revenue Bonds This is one of the most popular forms of financing for municipal golf courses as the debt is paid from the proceeds of the golf course and not from the taxpayers. However, there are two important considerations when considering these bonds: • Cash Flow: The cash flow from the operations must be sufficient to not only fund the operations, but also service the debt AND have some left over for future capital needs. • Management: If the bonds are tax-free, the IRS places significant restrictions on the compensation permitted with third-party management.

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Cash Flow Under revenue bonds, the debt is financed completely by the revenue from the golf operation. Thus, the cash flow needs to be sufficient enough to pay for the debt service in addition to the operating costs. Further, it is highly recommended that the cash flow be sufficient to also put money aside for future needs. Typically, these bonds can be financed over 15 or 20 years. The interest rates depend on the credit rating of the municipality and the term, with longer terms commanding higher interest rates. In today’s market, this can be anywhere from 1.8% to 3.5%. Management The first issue to be confronted with revenue bonds in relation to management is whether or not the bonds are tax-exempt. Most municipalities issue tax-exempt bonds for financing as they are thought to be more appealing to investors. However, the IRS places severe restrictions on the compensation of the management contracts under tax-exempt bonds. Not only can they not be leases, but only a small percentage of the operator’s compensation can be incentive-based. In other words, most of the compensation has to be guaranteed and cannot be based on profitability. Further, when operators lack the profit-incentive, performance is usually less than when there is a strong incentive. As the golf operations are self-managed, with the exception of food and beverage, this is not currently a concern but could pose an issue should the NPD consider outside management. The solution would be to issue taxable bonds. These may require a slightly higher interest rate to be as marketable, but we feel the tradeoff is worth it. Advantages The biggest advantage of this kind of financing is political. They are easier for the municipality to get issued as they rely on the operation for paying it back and have no direct impact on the taxpayer. Disadvantages There are several disadvantages that need to be considered: • Management: As discussed above, if tax-exempt bonds are issued, it places severe restrictions on the nature of the management contracts (if outside management is used), which often affects performance. Even if taxable bonds are used, the compensation needs to be such that there will be sufficient cash flow coming out of the operation to pay for the bonds. • Down Years: While cash flows over time may be projected to be sufficient, there inevitably are years when adverse weather or other conditions will cause the cash flow to be insufficient, requiring either subsidization or a large enough cash reserve to cover the deficit. This will definitely be the case during the construction years in any of the scenarios.

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• Cash Flow: One of the biggest concerns is that cash flow is never guaranteed. If, for whatever reason, revenue fails to match expectation and there is not enough cash flow to pay the debt, the municipality is often forced to subsidize the operation. This often results in expense cutbacks that usually lead to a greater reduction in revenue and the death spiral begins. General Obligation Bonds General obligation bonds are the main funding mechanism behind most city park improvements. The bonds are paid back out of the general fund, often from an increase in taxes approved by the voters for this purpose. Advantages The biggest advantage is that the debt is not a burden to the golf course. As a result, there are no negative impacts to the cash flow, only the positive impacts resulting from the improvements. Disadvantages The obvious disadvantage is that it requires voter approval, which may be difficult to achieve. Usually municipalities will include the golf course improvements as part of a much larger bond package that goes to improving the park system as a whole, making it easier to gain voter approval. Lease A very popular way of financing the improvements in today’s economy is to have the operator fund the improvements, in part or in whole, in exchange for a long- term lease. Advantages • Political: This is often the easiest method of funding from a political standpoint as it typically does not require voter approval. • Cash Flow: As the operation is leased out, the municipality would likely not have any expenses in relation to the golf course. (Although in some cases to attract operators, the municipality will provide a small subsidy or pay for some costs. But these are typically far less than what they are paying currently.) • Professional Operation: There are only a few operators out there that have the financial wherewithal and the desire to enter into these agreements. These are large management companies with strong records of success.

Disadvantages • Control: If the operator is paying for the improvements, they are going to want control over their implementation. Further, they will want total control

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over the operation during the length of the lease. In some cases, this can be detrimental to the goals of the municipality. • Capital Required: The higher the price tag for the improvements, the more it severely limits the number of likely bidders, possibly down to two or three, and is some cases, none. In these situations, a lower contribution may be used in conjunction with other funding in order to complete the project. • Long-term: A lot can happen in 20 years (the typical length for these types of leases). The management company can become financially strapped, leading to cutbacks in services to the golf course and/or a decline in maintenance. • End of the Lease: Unless the operator has a strong desire to renew the lease, the temptation is for the operator to make the improvements up front. By the end of the lease, the initial improvements are at the end of their life cycle, requiring another round of reinvestment. Further, if the operator has no desire to retain the lease, there is an incentive for the operator to try and maximize its profits in the last years of the lease, to the detriment of the asset and future performance. • Current Management: NPD is currently blessed with a very strong management team. Bringing in an outside company could jeopardize this. Current staff may not want to work under the management company’s direction, or the management company may choose to move them to a different facility. Sponsors In some cases, municipalities are able to find corporation or even individuals who are willing to contribute to the financing of the improvements. With corporations, this is usually done through sponsorships, normally in the form of naming rights. The naming rights may apply to the golf course or to a structure, such as the clubhouse. With individuals, it is usually in exchange for recognition, which may take the form of naming rights or dedications. Golf courses have long used this form of funding, usually with regards to individuals whose name often becomes part of the golf course. Typically, this was done for a person who donated the land for the course, but it could also be used for an individual who wants to pay for its renovation. A great example of how this can work is the City of Dallas, which is working in partnership with AT&T, the PGA and SMU (as well as a non-profit and other entities) in their construction of the Trinity Forest Golf Course. With NPD, this would seem to be an excellent option, given the number of high- profile companies headquartered in the area, plus the number of individuals with the financial means to offer considerable support.

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Advantages The money does not have to be repaid, so there is no adverse effect to the cash flow. Disadvantages • Effort: Finding suitable sponsors is often a difficult task and will require substantial effort. • Amount: The amount is seldom sufficient for a massive renovation. Instead, it is generally best suited for a specific project, such as a new clubhouse. Even then, it seldom is enough to pay the entire cost. • Image: Adding a corporate sponsor may detract from the desired image of the facility. Certainly, there is a “cost” to giving up the name in terms of image, so it is essential that the donation be sufficient enough to make up for this hidden cost. (For example, you would not want to rename the golf course after an individual or company who only contributes 1% of the funding needed to renovate the facility). • Political: While this typically would not require voter approval, depending on the sponsor and what is given up in exchange, there could be voter push back (e.g. The “Hooters Clubhouse” may upset some voters). Grants In some cases, there may be federal or state money available for specific projects if they go towards meeting a goal of interest. For example, there may be EPA funds available for projects related to improving water conservation, etc. (The Major scenario does provide for increased water detention). Another example may be government grants as part of an economic stimulus or redevelopment program. There are also corporations and non-profits that may be willing to provide some grant money for part of the project. One possibility for grants may be in working with First Tee, especially with regards to driving range and practice hole improvements. While they are not able to provide the grant directly, they often will work with municipalities to help secure local and national sponsorships and grants. Advantages The money does not have to be paid back. Disadvantages • Sources: Finding eligible funds and matching them to projects can be a real challenge. • Amount: The funds are usually limited and would only apply to part of the overall renovation project. However, every little bit helps. • Restrictions: The funds usually come with significant strings attached. These restrictions may end up costing more money than the funds provide.

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For example, if a fund requires use of union labor, the costs for doing so may exceed the amount of the grant itself. Recommendations Each of the above funding choices should be considered. There are strengths and weaknesses to each. What may well be the best solution will be a mix of two or more funding choices. The biggest concern is to make sure that any restrictions that may come with the funding do not end up costing as much or more than the funds themselves are providing. The second concern is to make sure that the golf operation can “afford” the funding, if it is expected to pay it back. This is especially true of revenue bonds that must be paid back from the proceeds of the operation. It is the requirement that the debt be paid back from cash flow that makes revenue bonds so scary. While we feel that there will be sufficient cash flow available to pay for much if not all the needed improvements, we do not feel it is wise to use ALL the projected cash flow for debt service as it leaves little to chance. While we do feel that revenue bonds are a good source of funding, we would like to see them supplemented by other funding that does not have to be paid back. We would also recommend exploring non-tax-exempt revenue bonds in order to provide more flexibility with regards to management contracts. However, there is a danger in using multiple funding sources. Because the facility is to be rebranded as part of the major upgrade, it is critical that it be timed so that all the improvements are completed in the same time frame so as to allow maximum impact. If the project is broken up into component parts in order to seek multiple funding sources, the risk is that one part would not be funded and therefore jeopardize the chance for success for the entire project. Perhaps the first decision will be how much, if any, of the project can practically be funded with G.O. bonds. They obviously will require the greatest length of time to secure as they require voter approval. We would recommend testing the waters to see if a bond package could be secured that would include at least partial funding for the golf course improvements. We also would encourage exploring private funding through donations and sponsorships. Again, this may be best used for specific projects rather than the overall renovation. For example, we can definitely see giving naming rights to a corporation or individual to the clubhouse in exchange for funding a substantial percentage of the costs for renovation or replacement. Perhaps the idea that will get the best traction is the idea of finding an operator who would be willing to fund the renovation in exchange for a long-term lease. This could easily become a win-win situation as it allows the municipality to benefit from the improvements without bearing any of the costs. It may also be the most politically expedient of the choices. However, it also provides the greatest restriction as it effectively takes the asset out of municipality’s control for twenty years.

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Phasing In our scenarios, we have shown the improvements to be conducted over a three- year period, with nine holes done at a time. This has proven to be the most effective method with regards to a 27-hole facility. However, given the amount of improvements needed and the total costs involved, there may be a temptation to “pick and choose” the improvements to be made now, while putting off others for the future. There are significant concerns with this notation. They include: 1. Cost: Spreading the improvements over an extended period will significantly increase the overall cost. This is due to three factors: a. Inflation: Construction costs increase over time, usually at a pace much higher than overall inflation. b. Efficiency: Considerable costs savings are realized when the various projects are done together as there are natural relationships. For example, redoing greens or tees will require redoing the irrigation to them. This can mean paying for that irrigation twice if at a later date the entire system is replaced. c. Staging: Staging for construction costs a lot of money. The more times you are requiring this to be done, the higher the overall cost for the project. 2. Consistency: When the projects are spread out over time, often different vendors may “win” the bids. This can lead to inconsistencies with the finished product. It can also lead to a lot of finger pointing down the road when things go wrong. 3. Lost Revenue: Many of the improvements require closing the course down for extended periods of time. Naturally, the more times you do this, the more revenue you will lose. Further, the more times you inconvenience your customers, the less customers you will have. 4. Marketing Impact: The biggest marketing impact, part of the rebranding effort, occurs when there is a “Grand Reopening” featuring the major changes. This will be considerably diluted if the project is in constant flux. We strongly recommend that as much as possible, the improvements be done at the same time, even if this means delaying the project a year or two to get the financing lined up. Academy and Range In all the scenarios, the star performers turn out to be the driving range and the academy. These are the only aspects of the operation that are currently performing well above expectations. This trend is likely to continue. The range certainly benefits from the number of golfers in the immediate area as well as its premium location on Dundee. Moving the range away from the road in

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Scenario 4, will reduce its visibility. However, this can be accounted for with better signage. And the relocation is unlikely to affect the current customers. Instead, the range will greatly benefit from more stations, a much nicer appearance, target greens, grass tees and certainly the heated/covered stalls. The Academy is especially important as it is not only a profit center, but it serves a vital role in developing new golfers. We were extremely impressed with how well it is currently performing, despite the lack of good facilities, including a remote short game area, poor range and no indoor facilities. By providing indoor space, Scenario 4 will help maximize the potential of the Academy. It will now be able to offer better training on site, with the development of a short game area. And most importantly, the indoor facility will improve teaching capability and allow the academy to become a 12-month operation. As these are the best performing aspects of the operation, Scenario 4: Major Improvements makes the most sense as it maximizes their opportunities for success. Management Options Before beginning this discussion, we reiterate that the Golf Division is very well managed. The discussion, though, is important as more and more municipalities move away from self-management. Fifty years ago, municipalities played a significant role in bringing golf to the masses. Indeed, it has only been in the last few decades that the public golfer had any options to play except at a municipal golf course. This is no longer true. Over the past several decades, most of the golf courses being built have been privately owned public access golf facilities. As a result, today, municipalities are finding they are not only competing head-to-head with private enterprises; they are doing so in an increasingly more competitive market. Unfortunately, few municipalities find they are equipped to handle this type of competitive environment. There are several factors that typically inhibit municipalities in their ability to compete successfully with private enterprise. These include: • Slow response: By nature of the bureaucracy that is typically involved in making decisions, government-owned businesses are typically very slow to respond to market conditions – such as rates, promotions, etc. • Budget Constraints: Often budgetary problems in other departments can have an adverse effect on golf operations. Even in cases where the municipality is not subsidizing the golf operations, needs in other departments can place greater pressure on the golf course to produce more revenue for the municipality.

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• Personnel Policies: One of the most glaring areas separating municipal governments from private enterprise is in relation to personnel policies and costs. This is particularly true with regards to: o Benefits: Municipalities typically offer very rich benefit packages – far superior to what is normally the case within the golf industry. o Termination: With most private enterprises, if an employee is not productive, they are terminated – and often quickly. With governments, however, it can be extremely difficult to get unproductive employees terminated. The emphasis is always on “rehabilitation” as well as avoiding litigation. Thus, it can take months or more of effort for a supervisor to remove an unproductive worker. o Pigeon-Holing: Often municipalities try to make golf course jobs fit in with their established job descriptions (and resulting compensation) for other areas – such as parks and recreation. Unfortunately, these comparisons are often inadequate and can result in a serious mismatch of personnel with job needs. • Marketing: Many municipalities lack marketing expertise that is critical to succeeding in a competitive business. In other cases, golf simply is not a priority within the marketing department. • Special Interests: By nature, municipalities are subject to the political process. This often results in situations where special interests can dictate policies or decisions that will adversely affect the golf operation’s profitability. • Procurement: When large items, especially capital improvements, are needed, municipalities are often constrained with lengthy procedures and mandated policies that not only slow the process down when timing can be critical, but also can lead to situations where the best product or contractor is not selected. • “Prevailing Wages”: In some areas, municipalities are constrained by prevailing wages and other labor restrictions that can drive up costs that do not apply to privately owned businesses. • Incentive: With most municipal golf operations where the staff are employees of the municipality, there are no incentives given to the managers for superior performance. So why work harder? Because of these considerations, many municipalities have made the decision to contract out management of their golf operations. However, is this the right option for NPD? What are the various options available? In this section, we will explore the various management options available to NPD for its Golf Division. We shall attempt to provide both the pros and cons of each option.

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There are three primary options: 1) Self-Management in some form, where all the managers are employees of the municipality; 2) Outside Management (privatization of some degree) where at least some of the management utilizes non-municipal employees; and 3) Leasing where the entire facility is leased out to a third party in exchange for compensation. In this section, we will explore the merits and problems of each. Self-Managed Currently, the Golf Division would be considered “Self-Managed” in that all the managers and employees are NPD Employees, and NPD has direct control over the day-to-day operations. The main advantage to the NPD is that the NPD retains total control over the facility (with the exception of food and beverage). One of the main disadvantages is that all employees are NPD employees. Given the higher cost of benefits to NPD employees, the resulting payroll is often out-of-line with competition. Issues Below are some issues commonly found with self-managed municipal operations: (Note: we have not seen evidence of most of these currently within the Golf Division.) • Incentive: One of the biggest issues is the lack of incentive for both management and staff at municipal facilities. Even the fear of losing their job is diminished within most municipal operations, given the difficulty that is usually involved in getting unproductive employees terminated. • Disincentive: Indeed, there is often a disincentive at municipal courses. Because more rounds mean more work, some employees will be motivated not to increase play. This works, because there is often little oversight and a lot of job security. • Competitive Wages: There are two issues that are common with municipal golf courses regarding wages. One concerns the managers and the other concerns maintenance labor. Both have to do with the fact that a golf course is a very different entity than a typical government workplace. A third common issue with municipalities involves discipline and termination of employees. All of these issues place a municipal operation at a disadvantage in the business world. o Labor: Too often, municipalities try to categorize course maintenance workers with the same job classifications they use for workers in the parks and recreations department. However, the job demands are entirely different. In a golf course operation, maintenance workers must work odd hours, work weekends, and constantly deal with time constraints and pressure resulting from a revenue-producing business. o Management: Good management in golf (general manager/head golf professionals and golf course superintendents) can often command wages that are more than their superiors in the municipal government

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are and even Commissioners earn. This can create obvious jealousies and tensions. • Termination Policy: With most municipal personnel termination policies, it becomes cumbersome to terminate unproductive employees, as the emphasis is on “rehabilitation.” Most municipal systems require a lot of paperwork and intervention by supervisors, who are not always prepared or willing to follow through. As a result, unproductive employees are often retained far longer than they would under a private employer. Unfortunately, the result is a double whammy as not only is that employee costing the municipality money, but also these unproductive employees can often be like a “cancer” among the workers as other staff see that they are able to get away with less work. • Bureaucracy: One of the main problems found with municipal golf operations is the degree of bureaucracy that often comes from government entities. The bureaucracy will often lead to costly delays and/or inferior quality. Three areas where bureaucracy can be especially damaging are found in: o Decision Making: With private enterprises, decisions can be made very quickly, which is extremely important in a very competitive world where the axiom “he who hesitates is lost” really comes into play. There often is so much concern in government about making the “wrong” decision that the indecision becomes a decision in and of itself. Meanwhile, the competition moves ahead. o Purchasing: Purchasing can often become delayed in government entities. Policies to accept the lowest bid can also backfire by having to accept inferior quality or service in exchange for the lowest price. The bidding process itself can delay the acquisition of badly needed equipment or supplies. • Human Resources: Personnel policies, both in hiring and termination, can often lead to the hiring of unqualified individuals and the inability to get rid of them, once hired. • Politics: Of course, one of the biggest issues with municipal golf operations is the degree to which politics influences what would normally be business decisions. Often, we find with municipal golf courses, that a small percentage of golfer can wield a disproportionate influence on the decision- making process simply by squeaking the loudest. Indeed, the entire political process often works the exact opposite of the way a business operates. For example, in business it is often necessary to react quickly to changing situations – such as competitive pressures. Governments, however, rarely can act quickly. • Multiple Managers: This is an issue we see at SCC, where there are four different managers involved in managing the facility. There is the Golf Division Manager, the food and beverage vendor, the Facilities Manager and

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the Fleet Manager. The Golf Division Manager has no control over the other three. And none of the other three have golf experience. This raises concerns about priorities, efficiencies and coordination. Advantages The following are the advantages of self-management, with the above recommended changes. • Simple: It does not involve a major change to the existing structure. • Control: Preserves total NPD control over the golf operation. • Effective: NPD has an excellent management team in place. Disadvantages • Payroll: Does not address the higher payroll cost due to benefits. • Personnel: Does not address other personnel issues, such as the termination policy. • Bureaucracy: Does not address issues regarding bureaucracy – such as decision-making process or purchasing issues. • Incentives: Difficult to create an effective incentive program in a municipal environment • Politics: Does not diminish the influence of politics in the management of the facility. • Marketing: Does not address the need to improve significantly the marketing efforts. Comments So far, this has been an effective method – a tribute to the management team in place, both within the golf division and at NPD. As they say, “if it’s not broken, don’t fix it.” Leasing At the opposite end of the spectrum is leasing. Under this scenario, the facilities would be leased out in its entirety to a private golf company (or individual), who would be responsible for all operating expenses as well as capital upkeep. The lessee would then receive most of the revenue. The NPD either would receive a flat payment, or would get a percentage of revenue (revenue lease). Advantages • Guaranteed Revenue Stream: Given that the lessee would be absorbing almost all the expenses, there would be no danger of the NPD having to subsidize the operation unless the lessee becomes financially distressed. • Reduced Risk: While the Golf Division is currently close to breaking even, it is in danger of not being so in the very near future. By leasing out the course to a private operator who is better suited to competing in a

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competitive market, the NPD reduces the risk of having to support the golf facility in the future. • Simplicity: The NPD would be relieved of a lot of the responsibility in maintaining and operating the facility. • Personnel: All employees become employees of the management firm. This reduces operating costs and eliminates the issues regarding personnel found in self-management. • Capital Improvements: In exchange for a long-term lease, many management companies are willing to invest significant amounts towards capital improvements. And most leases would require the leasee to be responsible for minor capital improvements over the course of the lease. • Capital Improvements (2): It may be possible under a lease, if the private company is responsible for making them, to avoid prevailing wage and other labor issues. This can save 10-15% of the construction costs. • Resources: Larger companies would have resources available, particularly concerning marketing and management expertise that smaller operators and self-managed facilities simply do not have. • Marketing: Larger companies will have a large marketing database to work with that is very beneficial to courses such as SCC. They would be able to market the facility to customers of all their other facilities, as well as being a part of their national campaigns. • Food and Beverage: Food and beverage would likely be included in such an agreement. This should have a very positive impact on performance and quality of the product as one entity is in charge and is highly-motivated to make it succeed. • One Management Entity: Currently, golf operations within NPD are being managed by four different entities, with three of them not having any true golf expertise. The bulk of the operation, of course, is handled by the Golf Division under the Director of Golf. But the Food and Beverage operation is contracted out (and doing poorly). Fleet services manages the mechanic and Facilities controls the Facility Manager. We could also add two more- Human Resources and Marketing. This can lead to conflicts of interests and priorities and decreased efficiencies. It is almost always better, from a business standpoint, to put everything under one manager who best understands the roles and interactions of the various departments and their impact on the quality of service to the customer. Disadvantages • Deferred Maintenance: Although provisions can be put in to try and “encourage” the lessee to continue to make additional improvements in the course, there are no guarantees that the lessee will do so, or in a manner that would be in NPD’s best interests. Inevitably, as the lease nears its end, the motivation for the lessee to put more money into the facility becomes

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less and less. As a result, the NPD may inherit a significantly deteriorated facility at the lease’s end. This is a frequent occurrence with municipal golf operations. Moreover, by having the lessee do any of the proposed capital improvements, the NPD would lose control over the quality of the work. In addition, by requiring capital improvements be made, the lessee will want a longer term to recover their investment. • Quality Control: Once the lease is signed, the NPD would have little ability to regulate the quality of the operation, if the lease terms are met. In addition, even if they are not met, the legal and practical cost to “force” conformity with the lease can be expensive. • Long term: Leases are typically for a long term, especially if capital improvements are included in the lease terms. This makes it difficult to get out of the lease, should the NPD become displeased with the lessee’s operations of the facility. • Referendum Required: This option may require the issue be put to the Citizens for approval; depending upon the length of the lease. This would cost the NPD the funds required to stage the vote and would put the option at risk of not being approved. Thus, the NPD risks the cost of the election, plus the costs associated with not doing any of the other options (opportunity cost) while the issue is being decided. In addition, if it fails, the NPD is back where it started, only with an additional “black eye” on its resume. • Viability: While leasing was popular in the 1980s and 90s, it has fallen into disfavor lately. It may be difficult to find a suitable vendor who is willing to accept lease terms that would be attractive to the NPD. • Employee Continuity: If you are leasing the facility to a large multi-facility management company, employees are often moved from facility to facility within their organization. This means less continuity at any given facility. • Management Continuity: While most management companies prefer to retain existing on-site management, there is no guarantee that they will do so, nor that the current staff would want to work for the management company. Given the quality of the staff at SCC and the golf division, this is a consideration. • Pecking Order: Similarly, with large management companies, you may not rate very high on their “priority” list. This may mean: o Less attention: Getting less attention from their main resource people. o Training ground: Your facility may be used as a “training ground” for new people, meaning you will always have the least experienced staff. Comments While leasing of municipal golf facilities has been popular in years past, its popularity has waned significantly in recent years. As these leases are expiring,

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Golf Operations Assessment Discussion municipalities are discovering they are often inheriting run-down amenities that require millions to fix back up. Additionally, as the lease typically runs for many years, the municipality becomes “stuck” with an operator – for better or worse. If it’s “worse” the NPD may have to endure years of misery before the lessee can be dislodged. Although the appeal of turning everything over to an outside agency does have a lot of merit, especially in terms of relieving stress, we feel the dangers of a lease make this a risky option. We also feel it will be difficult to attract an acceptable vendor with lease terms favorable enough to the NPD to make it attractive. On the other hand, if a lessor can be found that would be willing to make a substantial investment in the facilities (the capital improvements recommended herein), then leasing becomes a lot more attractive. Outside Management There are many ways in which the facility could utilize a third party to manage its golf operations. Some would be turn-key, where the third party provides assumes virtually all the expenses in the operation in exchange for most of the revenues; while others are management only – where only the management is third party and the NPD retains all the employees and assumes most of the expenses. The options that we will consider include: • Management Only: This is where a third party is brought in to manage, but the NPD retains all the employees and assumes all the expenses. • Pass Through: A modification of the management only, where the employees become employees of the management company, but the costs are still passed through to the municipality. • Hybrid Contract: Like leasing, but for shorter-term and greater retained control. The management company assumes all the operating expenses as with a lease, while the NPD shares in the revenue stream. In all three cases, the contract can exclude the course maintenance; if the NPD wishes to retain control of this area; however, we recommend full service contracts. Supervisory The Supervisory contract assumes that a management company (or individual) is hired to manage the facility. However, all employees remain employees of the municipality and the municipality would continue to pay all expenses. The management company would be paid a fee to oversee the operations. The fee can be a flat amount each month, or a percentage of revenue, or a combination of both. (Sirius would not recommend a flat fee situation as it would provide no incentive to perform). Advantages • Control: Preserves NPD control over the golf operation as the manager reports to a NPD official and the NPD retains all the employees.

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• Management: Provides experienced management expertise to oversee operations • Expertise: Potentially adds expertise to several areas (not a real concern with the current operations) • Resources: A management company can bring in resources that are not available to the NPD. • Costs: A management company can often reduce costs through discounts from vendors (larger buying power) and from better purchasing practices. • Improves Revenue Opportunities: Presumably, with professional management and marketing, revenue from the facility will improve significantly and the NPD could gain more revenue than it is currently seeing. • Resources: Larger companies would have resources available, particularly concerning marketing and management expertise, which smaller operators and self-managed facilities simply do not have. • Marketing: Larger companies will have a large marketing database to work with that is very beneficial to resort courses such as SNGC. They would be able to market the facility to customers of all their other facilities, as well as being a part of their national campaigns. They also should have a far better golf marketing expertise than found with most municipalities. Disadvantages • Overhead: Increases overhead and/or reduces share of revenue • Payroll: Does not address the payroll cost. • Personnel: Does not address other personnel issues, such as the termination policy. • Pecking Order: With large management companies, you may not rate very high on their “priority” list. This may mean: o Less attention: Getting less attention from their main resource people. o Training ground: Your facility may be used as a “training ground” for new people, meaning you will always have the least experienced staff. Comment The management company may or may not have a day-to-day presence at the facility, depending on whether it chooses to place a full-time General Manager at the facility or not. The management company can be effective by simply monitoring performance and visiting the site regularly during the month. These contracts work best when they are incentive-based. We would strongly recommend against a flat-fee contract. Ideally, you want an alignment of interests so that if the management company is doing well, the NPD is doing well and vice versa. We also do not recommend making the incentive based on only one or two

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Golf Operations Assessment Discussion aspects of the operation as this often leads to irregular performance whereby the management company gains, but the NPD loses. In the case of NPD and its Golf Division, we really see no major benefit to bringing in a management company under this type of contract. The reason is that the facility is already being well-managed and we do not see that a management company, other than in marketing, which is largely a budgetary consideration, would necessarily show enough improvements to justify the cost. Pass- Through This is very like the management-only, with one significant difference. The employees of the golf facilities become employees of the management company. However, the cost for these employees is passed through to the municipality. Advantages • Same as above, plus • Reduced Costs: Presumably the benefits costs would be lower with the management company, thereby reducing overall costs. These savings can be significant. • Personnel: Eliminates the personnel issues discussed under self- management. • 12-month operation: Large management companies can move personnel around from facility to facility. This can be a big advantage in short-season areas such as Chicago. They can move some of the professional staff to and from areas with the opposite season, such as Florida and Arizona, thereby guaranteeing them 12-month employment and increasing the appeal of the opportunity, thereby increasing the probability of attracting and retaining quality staff. Disadvantages • Same as supervisory-only Comments This option would be much preferred over the supervisory-only option above. The cost-savings from benefits, elimination of personnel issues seen with self- management, and the increased marketing expertise make this a viable option for NPD. Hybrid Contract A Hybrid contract blends many of the advantages of a lease with those of a management contract. Like a lease, the operations of the facility would be turned over to a privately-owned company who would be responsible for all the operating expenses. However, it is not a lease. It varies in several ways, including: • Term: A management contract is for a much shorter period, typically three to five years.

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• Capital Improvements: Typically, the municipality would still be responsible for all major capital improvements, although minor “upkeep” types of improvements are often the responsibility of the management company. (Some management companies may be willing to include some of the capital improvement recommendations contained in this report, in exchange for a longer-term contract and higher fee, along with a reimbursement agreement in case of premature termination of the contract). • Flexibility: A management contract can include all or only parts of the operation. Management companies can be paid by a flat fee, a percentage of revenue or a combination of both. Advantages • Potentially reduces operating costs: A management company is likely to have a substantially less expensive benefits package that can result in significant payroll savings. Their overall expertise may lead to improved efficiencies as they are more motivated to do so. • Eliminates employee termination issues: A management company would be able to terminate staff when it sees fit, without having to go through all the steps currently involved in firing a NPD employee. • Added Experience and Expertise: One main advantage of dealing with a management staff is the experience and expertise that such a company can bring to the table. Not only can it provide help in operations and maintenance but also in other areas such as marketing and merchandising. • Marketing: Many management companies have their own marketing departments that would be a strong asset to the course. In addition, larger management companies have a large database of customers, which is ideal for marketing a resort course! • Provides Revenue: The NPD would likely be assured a revenue stream under a hybrid contract. (The percentage, of course, depends on the nature of the contract). • Improves Revenue Opportunities: Presumably, with professional management and marketing, revenue from the facility will improve significantly and the NPD could gain more revenue than it is currently seeing. • Simplicity: The NPD would be relieved of a lot of the responsibility in maintaining and operating the facility. • Shorter term: Management contracts are for a shorter term than a lease and obviously not a permanent situation as would be the case in privatization. Additionally, provisions can often be included for buying out the contract short of term, should the situation become unacceptable to the NPD. • Reduces Political Influence: As the management company is tasked with making most of the decisions regarding operations, politics is minimized in its

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influence. This can be very important, especially if the management company is given the flexibility to set fees (which we recommend – within a range set by the NPD). • Costs: A management company can often reduce costs through discounts from vendors (larger buying power) and from better purchasing practices. • Food & Beverage: With professional management, the food and beverage service could be brought back in-house, thereby increasing the revenue opportunity. • Resources: Larger companies would have resources available, particularly concerning marketing and management expertise, which smaller operators and self-managed facilities simply do not have. • Marketing: Larger companies will have a large marketing database to work with that is very beneficial to resort courses such as SNGC. They would be able to market the facility to customers of all their other facilities, as well as being a part of their national campaigns. • Food and Beverage: Food and beverage would likely be included in such an agreement. This should have a very positive impact on performance and quality of the product as one entity is in charge and is highly-motivated to make it succeed. • One Management entity: As noted above. Disadvantages • Control: The NPD would have less ability to control the quality of operations. • Oversight: Municipalities tend to “relax” when they have a management company. The tendency is often to “trust” the company to do what it is supposedly “expert” at doing, only to discover after it’s too late that the management company mismanaged the facility to a significant degree. • Capital Improvements: The NPD would still be responsible for the long- term capital improvements. Such improvements would likely be required in the contract negotiations. • Final Year Syndrome. As with leases, management companies have a poor record of accomplishment in the final year of the contract, unless the company is strongly motivated to want to renew the contract. In the final year, the company is usually only interested in maximizing their revenue and minimizing their costs. Again, course maintenance becomes the primary victim. However, customer service often also falls off significantly. Thus, at the end of the contract, the NPD may be left with a poorly maintained golf course in need of capital improvements to be brought back into shape; a bad reputation resulting from poor service that will take time to rebuild; and a declining customer base that will also take time to recapture. • Management Turnover: Management companies often will move managers around, taking their best managers and putting them into their most

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profitable facilities. New Braunfels will not likely merit their best (unless the facility is significantly upgraded), and if the manager they place proves particularly capable, they are likely to be “promoted” and moved elsewhere. • Company Turnover: Currently, the golf industry is undergoing tremendous changes in management company ownerships. Management companies are being bought out and absorbed and others are going under. There would be no assurances that the company its managers who originally sign the contract will be around to see its conclusion. • No Guaranteed Income. Unlike a lease, management contracts usually do not provide a guaranteed income for the owner (the municipality), but rather a guaranteed income for the management company. • Employee Continuity: If you are leasing the facility to a large multi-facility management company, employees are often moved from facility to facility within their organization. This means less continuity at any given facility. • Pecking Order: Similarly, with large management companies, you may not rate very high on their “priority” list. This may mean: o Less attention: Getting less attention from their main resource people. o Training ground: Your facility may be used as a “training ground” for new people, meaning you will always have the least experienced staff. • Management Continuity: While most management companies prefer to retain existing on-site management, there is no guarantee that they will do so, nor that the current staff would want to work for the management company. Given the quality of the staff at SCC and the Golf Division, this is a consideration. Comments A version of the hybrid contract is what is currently being used by NPD with its food and beverage operation. This has worked positively to the extent it has saved NPD a significant amount of operating expense and has provided a positive (although small) cash flow. However, it has led to some customer dissatisfaction and quality control issues. Although most of these issues are primarily since the F&B operator is different than the golf operator. This arrangement is never ideal. There are good management companies and there are bad ones, and frankly, so many new ones and altered ones that their track record cannot be reliably established. To us, a hybrid contract makes the most sense as it removes payroll from the municipality while bringing in badly needed expertise and provides incentive-driven management. This should not only result in a major cost-savings to the overall operation, but eliminates other issues such as termination policies, too much time off, etc. Indeed, it is our opinion that a management company would likely be able to operate the facility for less money than the NPD is currently spending while improving service and significantly increasing revenue. Bringing

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F&B under the control of the Golf Division should greatly benefit both, as well as improve customer service. When combined with a revenue-sharing contract, the NPD would have a much greater chance for a much larger positive cash flow.

Many of the issues of a hybrid contract (disadvantages) can be minimized in four ways: • Careful selection of the management company, based on criteria other than just their fee; • Balanced Revenue Sharing: Many municipalities make the mistake of dividing the revenue by type – for example, the management company gets the cart fees, the NPD retains the green fees, etc. Unfortunately, this can create situations where the management company is going to act in its best interests and not necessarily the NPD’s. For example, discounts given for tournaments or through coupons reduce the green fee, but not the cart fee, so the NPD ends up bearing a disproportionate share of the marketing cost. Instead, we recommend that all the revenue be pooled together, and then split. Revenue from merchandise and food and beverage going into the pool would be defined as gross sales less the cost-of-sales. • A well-written contract that has checkpoints, quality conditions, and “outs”; and • Competent Oversight: More municipalities are utilizing consultants to perform quarterly checks on the management company’s performance. In this way, the municipality has its own “expert” that can more objectively and critically evaluate the management company’s performance. Of course, this adds to the overall cost of the contract and needs to be figured in when evaluating this scenario. We would also advocate a contract that features a “revenue sharing” concept as opposed to a flat fee model. Discussion and Recommendation It is our experience that self-managed facilities tend to fare the poorest when it comes to municipal operations. There are many reasons for this. In addition to the ones mentioned above, probably the most important reason is that municipal governments, by their very nature, are poorly equipped to compete with private enterprises in a highly competitive environment. Some examples of why include: • Decision Making Process: In a highly competitive environment, decisions must be made quickly. Governments, by their nature, are very slow in making decisions. This often filters down to the golf course where the General Manager is often given little decision-making authority. • Incentive: Businesses are in business to make money. Good businesses recognize that people in the business world are similarly motivated, so they structure their compensation to reward strong performance financially. This motivation is usually lacking in government operations, where performance often has little to do with compensation.

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• Marketing: Because governments are not normally competing with private enterprises, there is rarely a need to develop good marketing skills. Indeed, governments often fail to appreciate the importance of marketing. As a result, municipal golf facilities often do a very poor job marketing themselves. • Payroll: Payroll is often significantly higher for municipal operations. One of the primary culprits is usually a benefits package that far exceeds those normally found in the golf industry. This is particularly true for the golf course maintenance department. • Quality of Staff: One of the nice things about working for a municipality is job security. Unfortunately, when competing in a highly competitive environment, this job security works strongly against the municipal operation. Time and again, we find that municipal operations have personnel policies that make it very difficult to get rid of unproductive employees. As a result, the overall quality of the staff tends to go down as not only does the facility suffer from the unproductive employee, other employees’ morale and motivation suffer as they wonder why they should work hard when the other person is getting paid the same amount and goofs off. In private enterprise, with most companies, employees know that if they do good work, they will be rewarded – with better pay or a promotion. They also know that if they do not perform well, they will be looking for a new job -- soon. This double motivation is often lacking in municipal golf operations. (This has not been a big concern at NPD). As mentioned previously, we have great confidence in the current management team. Bringing in a management company under any of the types of contracts mentioned above, is not likely to improve the quality of management or produce significantly better efficiencies. We simply do not see many of the issues that plague other municipal courses at SCC or AGC. However, there are a couple of areas where having a management company involved, either under a hybrid contract or lease, could have significant impact. And these are food and beverage services, and marketing. The food and beverage operation is a mess right now and needs fixing. Some of it relates to the facilities, but a lot of it relates to how it is being managed. A third- party company that is only managing the food and beverage operation is naturally motivated to make sure it makes a profit. It is not as concerned about the overall customer satisfaction at the facility. As a result, it will limit services, such as the beverage cart, that could enhance overall customer satisfaction because it does not see it as being “worthwhile” for them. We also believe that marketing is a deficiency within the current structure. A lot of this is budgetary. Although some of it may be due to the golf courses not being a priority within NPD’s marketing department. A motivated outside company is not only likely to spend a lot more on marketing, they should have the expertise to do so effectively.

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We also believe that having all aspects of the operation under the control of the General Manager is best for operational efficiency as well as employee morale and customer service. This includes not only food and beverage, but facilities, mechanic, HR, marketing, etc. Our preference would be to utilize a hybrid contract, perhaps similar in nature to the one we helped write for the City of Carrollton, Texas. There certainly should be several management companies who would love to operate SCC, including the logical choices of Kemper Sports, who manages many of SCC’s competitors. However, a lease may make sense if it is desired to have them participate in the capital improvements. This would not only reduce NPD’s burden, but it could reduce the overall costs of these improvements. We recommend that a hybrid contract contain the following: • Pooled Revenue: The contract should not be based on a flat fee, but should incentivize the contractor to maximize performance in a way that is best for the NPD. We feel the best way to accomplish this is to have all revenue (less cost-of-sales and apart from lessons) be considered equally and subject to the same revenue split. • Oversight: The contract should contain an oversight mechanism that allows the NPD to inspect the operation on a regular basis (such as twice a year) and have set standards that the contractor should adhere to. If the contractor were not performing to standards, then there would be financial consequences. (We further suggest that these inspections be carried out by a qualified third party). Cherry-Picking In the case of a lease or a hybrid contract, the management companies are likely to want to “cherry pick”. They will want to manage SCC, but not necessarily AGC as they may see it as a money-loser. We would strongly recommend against such a decision. The facilities work best if they are all under one management entity. By the same token, we recommend against the Academy being spun off under a lease or hybrid contract. Not only would this create significant operational issues between it and the other aspects of the operation (range, SCC, AGC), but it removes one of the highest profit-generating aspects of the operation. Rebranding As our research has demonstrated, the biggest improvement in performance comes from a combination of renovations with a rebranding of the facility. This may or may not include market repositioning (price change). We recommend a rebranding occur with any of the change scenarios. It is critical, though, for the Major, which is the only one that also includes a repositioning in the marketplace. Rebranding should include:

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• New Name: Sportsman’s Country Club needs to be renamed. The current name has negative connotations and the facility has apparently developed a poor reputation in the marketplace, both as a “short course” and having poor playing conditions. Renaming will help emphasize that it is a different ball game now. • New Logo: A new logo is important for SCC under any situation, but is critical to rebranding. It should NOT include Northbrook Park District. The purpose should be to create interest and sell shirts, not promote the part district. • Marketing: Rebranding requires an extensive marketing campaign. Without it, the rebranding effort will not work. And this means a willingness to spend money. At a minimum, this should be $75,000 and really, should be more in the first year.

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Appendix A: Demographics Sportsman’s Population Change Population Change Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Percent Percent Percent Percent Number Number Number Number Change Change Change Change 1980 Census 476,359 2,786,875 7,054,803 8,042,925 1990 Census 517,590 8.70% 2,870,590 3.00% 7,194,683 2.00% 8,181,089 1.70% 2000 Census 556,123 7.40% 3,115,674 8.50% 7,982,944 11.00% 9,098,339 11.20% 2010 Census 557,717 0.30% 3,051,186 -2.10% 8,133,659 1.90% 9,461,105 4.00% 2016 Projection 549,184 -1.50% 3,063,578 0.40% 8,247,160 1.40% 9,580,805 1.30% 2021 Projection 548,478 -0.10% 3,077,472 0.50% 8,296,768 0.60% 9,630,434 0.50%

Households Change Households Change Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Percent Percent Percent Percent Number Number Number Number Change Change Change Change 1980 Census 163,659 1,029,389 2,479,554 2,802,234 1990 Census 193,616 18.30% 1,085,674 5.50% 2,606,778 5.10% 2,947,805 5.20% 2000 Census 207,124 7.00% 1,170,484 7.80% 2,879,430 10.50% 3,280,069 11.30% 2010 Census 211,731 2.20% 1,175,859 0.50% 2,997,242 4.10% 3,475,726 6.00% 2016 Projection 213,268 0.70% 1,209,204 2.80% 3,122,330 4.20% 3,619,652 4.10% 2021 Projection 217,389 1.90% 1,237,195 2.30% 3,210,336 2.80% 3,726,042 2.90% Families Families (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Families 148,673 729,209 2,003,747 2,354,615 Average Family Household Size 3.15 3.29 3.36 3.34 Households: Non-Family 64,595 479,995 1,118,583 1,265,037 Average Non-Family Household 1.16 1.26 1.23 1.23 Size

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Population by Race Population by Race (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent White 418,856 76.30% 2,055,077 67.10% 5,143,232 62.40% 6,137,598 64.10% Black 16,413 3.00% 299,591 9.80% 1,448,147 17.60% 1,668,805 17.40% Asian 74,785 13.60% 301,532 9.80% 606,958 7.40% 632,330 6.60% Native American 1,344 0.20% 12,350 0.40% 33,294 0.40% 36,913 0.40% Hawaiian / Pacific Islander 149 0.00% 1,175 0.00% 2,698 0.00% 3,026 0.00% Two or More 11,854 2.20% 89,317 2.90% 224,379 2.70% 253,919 2.70% Other Race 25,783 4.70% 304,537 9.90% 788,452 9.60% 848,214 8.90% Total 549,184 100.00% 3,063,579 100.00% 8,247,160 100.00% 9,580,805 100.00%

Hispanic Population Hispanic Population (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent Hispanic 73,658 13.40% 732,016 23.90% 1,906,281 23.10% 2,080,244 21.70% Not Hispanic 475,526 86.60% 2,331,562 76.10% 6,340,879 76.90% 7,500,561 78.30% Total 549,184 100.00% 3,063,578 100.00% 8,247,160 100.00% 9,580,805 100.00%

Income Income (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Median Household Income $84,036 $69,099 $64,684 $64,684 Average Household Income $125,288 $99,941 $89,729 $88,331 Average Family Income $151,521 $122,579 $106,641 $104,610 Per Capita Income $48,725 $39,589 $34,102 $33,497

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Households by Income Households by Income (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent Median Household Income $84,036 $69,099 $64,684 $64,684 Average Household Income $125,288 $99,941 $89,729 $88,331 Average Family Income $151,521 $122,579 $106,641 $104,610 Per Capita Income $48,725 $39,589 $34,102 $33,497 Less Than $10,000 7,925 3.70% 74,362 6.10% 217,940 7.00% 248,713 6.90% $10,000-$14,999 5,481 2.60% 43,662 3.60% 123,861 4.00% 142,774 3.90% $15,000-$19,999 6,430 3.00% 48,070 4.00% 133,957 4.30% 154,901 4.30% $20,000-$24,999 7,960 3.70% 53,690 4.40% 143,523 4.60% 164,960 4.60% $25,000-$29,999 7,001 3.30% 46,535 3.80% 127,210 4.10% 147,667 4.10% $30,000-$34,999 7,367 3.50% 47,240 3.90% 129,734 4.20% 151,501 4.20% $35,000-$39,999 7,397 3.50% 46,792 3.90% 124,704 4.00% 144,466 4.00% $40,000-$49,999 14,549 6.80% 91,851 7.60% 240,802 7.70% 279,363 7.70% $50,000-$59,999 13,848 6.50% 83,681 6.90% 225,821 7.20% 265,578 7.30% $60,000-$74,999 19,144 9.00% 113,282 9.40% 299,816 9.60% 351,952 9.70% $75,000-$99,999 26,373 12.40% 149,183 12.30% 393,186 12.60% 465,836 12.90% $100,000-$124,999 19,372 9.10% 106,183 8.80% 274,388 8.80% 324,466 9.00% $125,000-$149,999 15,412 7.20% 76,811 6.40% 195,329 6.30% 228,597 6.30% $150,000-$199,999 19,717 9.20% 91,220 7.50% 219,630 7.00% 251,809 7.00% $200,000-$249,999 13,619 6.40% 52,707 4.40% 104,840 3.40% 114,322 3.20% $250,000-$499,999 18,062 8.50% 70,018 5.80% 139,891 4.50% 152,539 4.20% $500,000+ 3,611 1.70% 13,919 1.20% 27,700 0.90% 30,208 0.80% Total 213,268 100.00% 1,209,206 100.00% 3,122,332 100.00% 3,619,652 100.00% Households by Tenure Households by Tenure (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Number Percent Number Percent Number Percent Number Percent Owner Occupied 164,371 73.40% 727,633 57.20% 1,973,942 60.10% 2,349,281 61.70% Renter Occupied 48,897 21.80% 481,571 37.90% 1,148,388 35.00% 1,270,371 33.30% Vacant 10,798 4.80% 62,816 4.90% 161,366 4.90% 190,294 5.00% Total 224,066 100.00% 1,272,020 100.00% 3,283,696 100.00% 3,809,946 100.00%

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Daytime Population Daytime Population (2016) Travel Time of 15 Travel Time of 30 Travel Time of 60 Metro area minutes minutes minutes Establishments 31,827 150,529 351,713 399,662 Employees 460,427 1,854,752 4,436,258 4,910,610 15 Minute Drive Time Trends Households by Income Households by Income 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Less Than $10,000 8,043 3.80% 7,925 3.70% 7,789 3.60% $10,000 - $14,999 6,495 3.10% 5,481 2.60% 4,798 2.20% $15,000 - $19,999 7,737 3.70% 6,430 3.00% 5,422 2.50% $20,000 - $24,999 8,717 4.10% 7,960 3.70% 6,605 3.00% $25,000 - $29,999 8,505 4.00% 7,001 3.30% 7,398 3.40% $30,000 - $34,999 9,059 4.30% 7,367 3.50% 6,551 3.00% $35,000 - $39,999 8,228 3.90% 7,397 3.50% 6,834 3.10% $40,000 - $44,999 8,766 4.10% 7,558 3.50% 6,880 3.20% $45,000 - $49,999 7,979 3.80% 6,991 3.30% 6,129 2.80% $50,000 - $59,999 14,385 6.80% 13,848 6.50% 12,657 5.80% $60,000 - $74,999 20,210 9.50% 19,144 9.00% 19,482 9.00% $75,000 - $99,999 27,909 13.20% 26,373 12.40% 24,837 11.40% $100,000 - $124,999 20,996 9.90% 19,372 9.10% 20,073 9.20% $125,000 - $149,999 13,186 6.20% 15,412 7.20% 15,638 7.20% $150,000 - $199,999 16,382 7.70% 19,717 9.20% 21,197 9.80% $200,000+ 25,134 11.90% 35,292 16.50% 45,098 20.70% Total 211,731 100.00% 213,268 100.00% 217,389 100.00%

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Population by Age Population by Age 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Age 0-4 31,011 5.60% 30,969 5.60% 30,170 5.50% Age 5-9 36,456 6.50% 34,562 6.30% 34,164 6.20% Age 10-14 38,243 6.90% 35,231 6.40% 34,375 6.30% Age 15-19 35,994 6.50% 33,248 6.10% 33,349 6.10% Age 20-24 26,427 4.70% 26,321 4.80% 26,778 4.90% Age 25-29 29,792 5.30% 29,708 5.40% 27,116 4.90% Age 30-34 29,611 5.30% 33,143 6.00% 30,794 5.60% Age 35-39 33,593 6.00% 34,950 6.40% 35,830 6.50% Age 40-44 38,960 7.00% 36,641 6.70% 37,669 6.90% Age 45-49 43,881 7.90% 38,038 6.90% 37,142 6.80% Age 50-54 46,421 8.30% 41,287 7.50% 37,579 6.90% Age 55-59 41,383 7.40% 41,607 7.60% 37,848 6.90% Age 60-64 34,499 6.20% 36,588 6.70% 36,093 6.60% Age 65-69 24,829 4.50% 29,603 5.40% 31,944 5.80% Age 70-74 19,876 3.60% 22,807 4.20% 26,783 4.90% Age 75-79 16,521 3.00% 16,305 3.00% 19,655 3.60% Age 80-84 15,084 2.70% 12,436 2.30% 13,842 2.50% Age 85+ 15,137 2.70% 15,741 2.90% 17,348 3.20% Total 557,717 100.00% 549,184 100.00% 548,478 100.00% Median 42.3 42.2 42.9 Population by Race Trends Population by Race Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent White 441,809 79.20% 418,856 76.30% 407,066 74.20% Black 10,065 1.80% 16,413 3.00% 21,181 3.90% Native American 1,431 0.30% 1,344 0.20% 1,451 0.30% Asian 67,723 12.10% 74,785 13.60% 78,156 14.20% Hawaiian / Pacific 152 0.00% 149 0.00% 162 0.00% Islander Two or More 11,091 2.00% 11,854 2.20% 13,222 2.40% Other Race 25,445 4.60% 25,783 4.70% 27,241 5.00% Total 557,717 100.00% 549,184 100.00% 548,478 100.00%

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Hispanic Population Trends Hispanic Population Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Hispanic 65,605 11.80% 73,658 13.40% 81,750 14.90%

Not Hispanic 492,112 88.20% 475,526 86.60% 466,728 85.10%

Total 557,717 100.00% 549,184 100.00% 548,478 100.00% Households by Occupancy Trends Households by Occupancy Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Owner Occupied 164,832 73.20% 164,371 73.40% 170,886 74.30% Renter Occupied 46,899 20.80% 48,897 21.80% 46,503 20.20% Vacant 13,537 6.00% 10,798 4.80% 12,480 5.40% Total 225,268 100.00% 224,066 100.00% 229,869 100.00% Daytime Population Trends Daytime Population

2010 2016 2021

CENSUS ESTIMATE FORECAST

Establishments 0 31,827 0 Employees 0 460,427 0 30 Minute Drive Time Trends Summary Demographic

2010 2016 2021

CENSUS ESTIMATE FORECAST

Population 3,051,186 3,063,578 3,077,472 Households 1,175,859 1,209,204 1,237,195 Families 723,326 729,209 729,490 Median Age 36.2 37.4 38.7 Median Household Income $60,181 $69,099 $75,503 Average Household Income $87,309 $99,941 $119,339 Average Household Size 2.59 2.53 2.49

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Households by Income Households by Income 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Less Than $10,000 74,334 6.30% 74,362 6.10% 73,887 6.00% $10,000 - $14,999 48,710 4.10% 43,662 3.60% 39,026 3.20% $15,000 - $19,999 56,270 4.80% 48,070 4.00% 41,338 3.30% $20,000 - $24,999 59,282 5.00% 53,690 4.40% 46,609 3.80% $25,000 - $29,999 53,034 4.50% 46,535 3.80% 49,356 4.00% $30,000 - $34,999 54,063 4.60% 47,240 3.90% 43,286 3.50% $35,000 - $39,999 52,028 4.40% 46,792 3.90% 43,459 3.50% $40,000 - $44,999 53,745 4.60% 46,740 3.90% 43,483 3.50% $45,000 - $49,999 47,022 4.00% 45,111 3.70% 38,077 3.10% $50,000 - $59,999 88,044 7.50% 83,681 6.90% 81,013 6.50% $60,000 - $74,999 116,082 9.90% 113,282 9.40% 116,167 9.40% $75,000 - $99,999 145,838 12.40% 149,183 12.30% 143,858 11.60% $100,000 - $124,999 103,979 8.80% 106,183 8.80% 111,701 9.00% $125,000 - $149,999 65,018 5.50% 76,811 6.40% 83,379 6.70% $150,000 - $199,999 71,057 6.00% 91,220 7.50% 102,260 8.30% $200,000+ 87,352 7.40% 136,644 11.30% 180,297 14.60% Total 1,175,859 100.00% 1,209,204 100.00% 1,237,195 100.00%

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Population By Age Population by Age 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Age 0-4 193,998 6.40% 190,331 6.20% 185,848 6.00% Age 5-9 187,939 6.20% 184,489 6.00% 183,064 5.90% Age 10-14 188,039 6.20% 182,243 5.90% 179,807 5.80% Age 15-19 195,745 6.40% 187,952 6.10% 191,067 6.20% Age 20-24 211,881 6.90% 202,015 6.60% 200,343 6.50% Age 25-29 260,445 8.50% 235,820 7.70% 208,797 6.80% Age 30-34 236,014 7.70% 244,768 8.00% 224,070 7.30% Age 35-39 216,384 7.10% 221,047 7.20% 225,816 7.30% Age 40-44 213,062 7.00% 207,427 6.80% 214,320 7.00% Age 45-49 219,521 7.20% 201,667 6.60% 201,251 6.50% Age 50-54 217,364 7.10% 205,746 6.70% 194,502 6.30% Age 55-59 188,736 6.20% 202,047 6.60% 191,182 6.20% Age 60-64 154,422 5.10% 174,978 5.70% 179,247 5.80% Age 65-69 107,693 3.50% 137,062 4.50% 154,044 5.00% Age 70-74 81,281 2.70% 100,016 3.30% 122,404 4.00% Age 75-79 65,272 2.10% 70,387 2.30% 88,053 2.90% Age 80-84 55,634 1.80% 51,092 1.70% 59,481 1.90% Age 85+ 57,759 1.90% 64,489 2.10% 74,174 2.40% Total 3,051,186 100.00% 3,063,578 100.00% 3,077,472 100.00% Median 36.2 37.4 38.7 Population by Race Population by Race Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent White 2,109,282 69.10% 2,055,077 67.10% 2,015,792 65.50% Black 279,359 9.20% 299,591 9.80% 313,991 10.20% Native American 12,675 0.40% 12,350 0.40% 13,070 0.40% Asian 263,155 8.60% 301,532 9.80% 318,415 10.30% Hawaiian / Pacific 1,202 0.00% 1,175 0.00% 1,232 0.00% Islander Two or More 85,122 2.80% 89,317 2.90% 96,460 3.10% Other Race 300,391 9.80% 304,537 9.90% 318,512 10.30% Total 3,051,186 100.00% 3,063,578 100.00% 3,077,472 100.00%

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Hispanic Race Trends Hispanic Population Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Hispanic 690,594 22.60% 732,016 23.90% 780,021 25.30% Not Hispanic 2,360,592 77.40% 2,331,562 76.10% 2,297,451 74.70% Total 3,051,186 100.00% 3,063,578 100.00% 3,077,472 100.00% Households by Occupancy Trends Households by Occupancy Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Owner Occupied 718,718 56.40% 727,633 57.20% 767,716 58.80% Renter Occupied 457,141 35.90% 481,571 37.90% 469,479 36.00% Vacant 98,440 7.70% 62,816 4.90% 67,538 5.20% Total 1,274,299 100.00% 1,272,020 100.00% 1,304,733 100.00% Daytime Population Daytime Population

2010 2016 2021

CENSUS ESTIMATE FORECAST

Establishments 0 150,529 0 Employees 0 1,854,752 0 60-Minute Drive Time Trends Summary Demographic Summary Demographic

2010 2016 2021

CENSUS ESTIMATE FORECAST

Population 8,133,659 8,247,160 8,296,768 Households 2,997,242 3,122,330 3,210,336 Families 1,963,564 2,003,747 2,012,230 Median Age 35.7 37.1 38.3 Median Household Income $57,576 $64,684 $70,962 Average Household Income $79,283 $89,729 $106,315 Average Household Size 2.71 2.64 2.58

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Households by Income Households by Income 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Less Than $10,000 205,904 6.90% 217,940 7.00% 218,075 6.80% $10,000 - $14,999 132,919 4.40% 123,861 4.00% 111,867 3.50% $15,000 - $19,999 148,858 5.00% 133,957 4.30% 116,067 3.60% $20,000 - $24,999 156,480 5.20% 143,523 4.60% 127,849 4.00% $25,000 - $29,999 138,289 4.60% 127,210 4.10% 133,327 4.20% $30,000 - $34,999 144,811 4.80% 129,734 4.20% 119,568 3.70% $35,000 - $39,999 134,859 4.50% 124,704 4.00% 118,958 3.70% $40,000 - $44,999 138,148 4.60% 122,240 3.90% 115,463 3.60% $45,000 - $49,999 121,923 4.10% 118,562 3.80% 99,954 3.10% $50,000 - $59,999 232,881 7.80% 225,821 7.20% 217,134 6.80% $60,000 - $74,999 301,969 10.10% 299,816 9.60% 310,473 9.70% $75,000 - $99,999 383,956 12.80% 393,186 12.60% 385,481 12.00% $100,000 - $124,999 263,235 8.80% 274,388 8.80% 291,113 9.10% $125,000 - $149,999 158,720 5.30% 195,329 6.30% 213,519 6.70% $150,000 - $199,999 165,280 5.50% 219,630 7.00% 257,490 8.00% $200,000+ 169,009 5.60% 272,431 8.70% 373,996 11.60% Total 2,997,242 100.00% 3,122,330 100.00% 3,210,336 100.00%

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Population by Age Population by Age 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Age 0-4 543,787 6.70% 516,686 6.30% 505,694 6.10% Age 5-9 554,775 6.80% 526,140 6.40% 506,987 6.10% Age 10-14 568,189 7.00% 539,803 6.50% 514,430 6.20% Age 15-19 580,222 7.10% 552,789 6.70% 549,348 6.60% Age 20-24 544,172 6.70% 557,940 6.80% 560,807 6.80% Age 25-29 618,155 7.60% 586,178 7.10% 557,416 6.70% Age 30-34 583,132 7.20% 603,322 7.30% 573,337 6.90% Age 35-39 567,056 7.00% 567,114 6.90% 571,424 6.90% Age 40-44 570,342 7.00% 553,661 6.70% 554,529 6.70% Age 45-49 596,928 7.30% 550,646 6.70% 537,762 6.50% Age 50-54 583,465 7.20% 566,236 6.90% 531,270 6.40% Age 55-59 495,640 6.10% 548,228 6.60% 523,018 6.30% Age 60-64 401,657 4.90% 469,768 5.70% 488,715 5.90% Age 65-69 283,658 3.50% 367,475 4.50% 417,706 5.00% Age 70-74 209,160 2.60% 265,196 3.20% 325,658 3.90% Age 75-79 164,556 2.00% 186,043 2.30% 233,756 2.80% Age 80-84 134,742 1.70% 132,201 1.60% 157,117 1.90% Age 85+ 134,024 1.60% 157,734 1.90% 187,793 2.30% Total 8,133,659 100.00% 8,247,160 100.00% 8,296,768 100.00% Median 35.7 37.1 38.3 Population by Race Trends Population by Race Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent White 5,183,112 63.70% 5,143,232 62.40% 5,084,855 61.30% Black 1,424,667 17.50% 1,448,147 17.60% 1,456,373 17.60% Native American 32,975 0.40% 33,294 0.40% 35,798 0.40% Asian 513,765 6.30% 606,958 7.40% 643,621 7.80% Hawaiian / Pacific 2,637 0.00% 2,698 0.00% 2,863 0.00% Islander Two or More 203,399 2.50% 224,379 2.70% 245,756 3.00% Other Race 773,106 9.50% 788,452 9.60% 827,503 10.00% Total 8,133,659 100.00% 8,247,160 100.00% 8,296,768 100.00%

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Hispanic Population Hispanic Population Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Hispanic 1,800,050 22.10% 1,906,281 23.10% 2,033,634 24.50% Not Hispanic 6,333,609 77.90% 6,340,879 76.90% 6,263,134 75.50% Total 8,133,659 100.00% 8,247,160 100.00% 8,296,768 100.00% Households by Occupancy Households by Occupancy Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Owner Occupied 1,930,287 58.90% 1,973,942 60.10% 2,078,435 61.60% Renter Occupied 1,066,955 32.50% 1,148,388 35.00% 1,131,901 33.50% Vacant 280,924 8.60% 161,366 4.90% 165,832 4.90% Total 3,278,166 100.00% 3,283,696 100.00% 3,376,167 100.00% Daytime Population Daytime Population

2010 2016 2021

CENSUS ESTIMATE FORECAST

Establishments 0 351,713 0 Employees 0 4,436,258 0

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Anetsberger Population Change Population Change Travel Time of 15 Travel Time of 30

minutes minutes Percent Percent Number Number Change Change 1980 Census 399,525 2,876,813 1990 Census 409,278 2.40% 2,900,676 0.80% 2000 Census 434,554 6.20% 3,119,966 7.60% 2010 Census 438,174 0.80% 3,058,381 -2.00% 2016 Projection 431,668 -1.50% 3,096,299 1.20% 2021 Projection 431,417 -0.10% 3,113,661 0.60% Households Change Households Change Travel Time of 15 Travel Time of 30

minutes minutes Percent Percent Number Number Change Change 1980 Census 139,251 1,073,493 1990 Census 154,011 10.60% 1,112,837 3.70% 2000 Census 162,831 5.70% 1,196,362 7.50% 2010 Census 165,789 1.80% 1,210,167 1.20% 2016 Projection 166,990 0.70% 1,257,916 3.90% 2021 Projection 170,114 1.90% 1,287,576 2.40% Families Families (2016) Travel Time of Travel Time of

15 minutes 30 minutes Families 116,904 716,842 Average Family Household Size 3.15 3.28 Households: Non-Family 50,085 541,074 Average Non-Family Household 1.14 1.26 Size

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Population by Age Population by Race (2016) Travel Time of 15 Travel Time of 30

minutes minutes Number Percent Number Percent White 324,030 75.10% 2,011,609 65.00% Black 14,249 3.30% 376,430 12.20% Asian 66,358 15.40% 310,431 10.00% Native American 949 0.20% 12,049 0.40% Hawaiian / Pacific 111 0.00% 1,236 0.00% Islander Two or More 9,905 2.30% 89,977 2.90% Other Race 16,065 3.70% 294,566 9.50% Total 431,667 100.00% 3,096,298 100.00% Hispanic Population Hispanic Population (2016) Travel Time of 15 Travel Time of 30

minutes minutes Number Percent Number Percent Hispanic 49,355 11.40% 711,489 23.00% Not Hispanic 382,313 88.60% 2,384,810 77.00% Total 431,668 100.00% 3,096,299 100.00% Income Income (2016) Travel Time of 15 Travel Time of 30

minutes minutes Median Household $84,468 $67,620 Income Average Household $130,191 $99,462 Income Average Family Income $158,475 $122,506 Per Capita Income $50,444 $40,566

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Households by Income Households by Income (2016) Travel Time of 15 Travel Time of 30

minutes minutes Number Percent Number Percent Less Than $10,000 6,945 4.20% 88,732 7.10% $10,000-$14,999 4,550 2.70% 48,600 3.90% $15,000-$19,999 5,228 3.10% 50,949 4.10% $20,000-$24,999 5,959 3.60% 55,754 4.40% $25,000-$29,999 5,583 3.30% 48,597 3.90% $30,000-$34,999 5,961 3.60% 48,967 3.90% $35,000-$39,999 6,058 3.60% 47,864 3.80% $40,000-$49,999 11,210 6.70% 94,363 7.50% $50,000-$59,999 10,195 6.10% 86,084 6.80% $60,000-$74,999 14,107 8.40% 116,239 9.20% $75,000-$99,999 20,325 12.20% 151,684 12.10% $100,000-$124,999 14,797 8.90% 108,095 8.60% $125,000-$149,999 11,279 6.80% 77,329 6.10% $150,000-$199,999 14,830 8.90% 92,336 7.30% $200,000-$249,999 11,568 6.90% 54,910 4.40% $250,000-$499,999 15,327 9.20% 72,905 5.80% $500,000+ 3,067 1.80% 14,509 1.20% Total 166,989 100.00% 1,257,917 100.00% Households by Tenure Households by Tenure (2016) Travel Time of 15 Travel Time of 30

minutes minutes Number Percent Number Percent Owner Occupied 130,327 74.20% 708,844 53.30% Renter Occupied 36,663 20.90% 549,072 41.30% Vacant 8,624 4.90% 72,628 5.50% Total 175,614 100.00% 1,330,544 100.00% Daytime Population Daytime Population (2016) Travel Time of 15 Travel Time of 30

minutes minutes Establishments 26,257 172,631 Employees 351,352 2,341,173

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15-minute Travel Time Summary Demographic Summary Demographic 2010 2016 2021

CENSUS ESTIMATE FORECAST Population 438,174 431,668 431,417 Households 165,789 166,990 170,114 Families 117,903 116,904 116,589 Median Age 43.4 43.1 43.5 Median Household Income $73,754 $84,468 $93,644 Average Household Income $117,623 $130,191 $157,900 Average Household Size 2.64 2.58 2.54 Households by Income Households by Income 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Less Than $10,000 7,174 4.30% 6,945 4.20% 6,816 4.00% $10,000 - $14,999 5,073 3.10% 4,550 2.70% 4,005 2.40% $15,000 - $19,999 5,994 3.60% 5,228 3.10% 4,434 2.60% $20,000 - $24,999 6,803 4.10% 5,959 3.60% 5,104 3.00% $25,000 - $29,999 6,465 3.90% 5,583 3.30% 5,663 3.30% $30,000 - $34,999 7,192 4.30% 5,961 3.60% 5,300 3.10% $35,000 - $39,999 6,611 4.00% 6,058 3.60% 5,535 3.30% $40,000 - $44,999 7,249 4.40% 5,814 3.50% 5,644 3.30% $45,000 - $49,999 5,860 3.50% 5,397 3.20% 4,618 2.70% $50,000 - $59,999 10,691 6.40% 10,195 6.10% 9,646 5.70% $60,000 - $74,999 15,030 9.10% 14,107 8.40% 14,293 8.40% $75,000 - $99,999 20,612 12.40% 20,325 12.20% 18,771 11.00% $100,000 - $124,999 16,027 9.70% 14,797 8.90% 15,444 9.10% $125,000 - $149,999 10,479 6.30% 11,279 6.80% 11,848 7.00% $150,000 - $199,999 12,895 7.80% 14,830 8.90% 15,549 9.10% $200,000+ 21,632 13.00% 29,962 17.90% 37,444 22.00% Total 165,789 100.00% 166,990 100.00% 170,114 100.00%

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Population by Age Population by Age 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Age 0-4 23,845 5.40% 24,335 5.60% 23,665 5.50% Age 5-9 28,672 6.50% 27,506 6.40% 27,489 6.40% Age 10-14 30,199 6.90% 27,751 6.40% 27,396 6.40% Age 15-19 27,912 6.40% 25,463 5.90% 25,687 6.00% Age 20-24 19,864 4.50% 19,343 4.50% 19,539 4.50% Age 25-29 21,412 4.90% 22,066 5.10% 19,790 4.60% Age 30-34 21,565 4.90% 25,067 5.80% 23,232 5.40% Age 35-39 25,047 5.70% 26,749 6.20% 27,833 6.50% Age 40-44 29,984 6.80% 28,546 6.60% 29,819 6.90% Age 45-49 33,760 7.70% 29,464 6.80% 29,148 6.80% Age 50-54 36,035 8.20% 31,865 7.40% 29,166 6.80% Age 55-59 33,117 7.60% 32,748 7.60% 29,573 6.90% Age 60-64 28,158 6.40% 29,448 6.80% 28,674 6.60% Age 65-69 20,602 4.70% 24,301 5.60% 25,845 6.00% Age 70-74 16,837 3.80% 19,010 4.40% 22,052 5.10% Age 75-79 14,116 3.20% 13,648 3.20% 16,173 3.70% Age 80-84 13,055 3.00% 10,477 2.40% 11,436 2.70% Age 85+ 13,994 3.20% 13,880 3.20% 14,901 3.50% Total 438,174 100.00% 431,668 100.00% 431,417 100.00% Median 43.4 43.1 43.5 Population by Race Trends Population by Race Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent White 341,705 78.00% 324,030 75.10% 314,678 72.90% Black 9,244 2.10% 14,249 3.30% 18,094 4.20% Native American 1,004 0.20% 949 0.20% 1,032 0.20% Asian 61,027 13.90% 66,358 15.40% 69,325 16.10% Hawaiian / Pacific Islander 114 0.00% 111 0.00% 121 0.00% Two or More 9,332 2.10% 9,905 2.30% 11,016 2.60% Other Race 15,749 3.60% 16,065 3.70% 17,151 4.00% Total 438,174 100.00% 431,668 100.00% 431,417 100.00%

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Hispanic Population Trends Hispanic Population Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Hispanic 42,259 9.60% 49,355 11.40% 55,707 12.90% Not Hispanic 395,916 90.40% 382,313 88.60% 375,710 87.10% Total 438,174 100.00% 431,668 100.00% 431,417 100.00% Daytime Population Daytime Population

2010 CENSUS 2016 ESTIMATE 2021 FORECAST

Establishments 0 26,257 0 Employees 0 351,352 0 30-Minute Drive Time Trends Summary Demographic Summary Demographic 2010 2016 2021

CENSUS ESTIMATE FORECAST Population 3,058,381 3,096,299 3,113,661 Households 1,210,167 1,257,916 1,287,576 Families 707,497 716,842 717,054 Median Age 35.6 36.9 38.4 Median Household Income $58,558 $67,620 $73,887 Average Household Income $86,531 $99,462 $118,826 Average Household Size 2.53 2.46 2.42

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Households by Income Households by Income 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Less Than $10,000 88,068 7.30% 88,732 7.10% 88,385 6.90% $10,000 - $14,999 53,019 4.40% 48,600 3.90% 43,623 3.40% $15,000 - $19,999 59,242 4.90% 50,949 4.10% 44,232 3.40% $20,000 - $24,999 61,259 5.10% 55,754 4.40% 48,801 3.80% $25,000 - $29,999 55,043 4.50% 48,597 3.90% 51,313 4.00% $30,000 - $34,999 55,561 4.60% 48,967 3.90% 45,080 3.50% $35,000 - $39,999 53,363 4.40% 47,864 3.80% 44,841 3.50% $40,000 - $44,999 55,034 4.50% 48,150 3.80% 44,394 3.40% $45,000 - $49,999 47,859 4.00% 46,213 3.70% 39,368 3.10% $50,000 - $59,999 89,551 7.40% 86,084 6.80% 83,072 6.50% $60,000 - $74,999 117,800 9.70% 116,239 9.20% 119,553 9.30% $75,000 - $99,999 146,338 12.10% 151,684 12.10% 146,638 11.40% $100,000 - $124,999 102,947 8.50% 108,095 8.60% 113,684 8.80% $125,000 - $149,999 64,059 5.30% 77,329 6.10% 84,784 6.60% $150,000 - $199,999 70,545 5.80% 92,336 7.30% 102,845 8.00% $200,000+ 90,480 7.50% 142,324 11.30% 186,963 14.50% Total 1,210,167 100.00% 1,257,916 100.00% 1,287,576 100.00%

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Population by Age Population by Age 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Age 0-4 191,293 6.30% 190,688 6.20% 186,712 6.00% Age 5-9 180,593 5.90% 180,205 5.80% 180,666 5.80% Age 10-14 179,802 5.90% 176,327 5.70% 175,965 5.70% Age 15-19 193,828 6.30% 186,812 6.00% 190,951 6.10% Age 20-24 225,954 7.40% 213,143 6.90% 209,205 6.70% Age 25-29 282,321 9.20% 254,761 8.20% 221,489 7.10% Age 30-34 247,086 8.10% 258,546 8.40% 235,527 7.60% Age 35-39 218,089 7.10% 225,861 7.30% 232,339 7.50% Age 40-44 209,782 6.90% 207,639 6.70% 216,700 7.00% Age 45-49 214,055 7.00% 199,965 6.50% 201,579 6.50% Age 50-54 212,039 6.90% 203,175 6.60% 193,694 6.20% Age 55-59 185,139 6.10% 200,388 6.50% 190,318 6.10% Age 60-64 153,018 5.00% 175,115 5.70% 179,544 5.80% Age 65-69 107,382 3.50% 137,654 4.40% 154,771 5.00% Age 70-74 81,631 2.70% 100,699 3.30% 123,094 4.00% Age 75-79 65,211 2.10% 70,898 2.30% 88,470 2.80% Age 80-84 55,061 1.80% 51,144 1.70% 59,540 1.90% Age 85+ 56,095 1.80% 63,279 2.00% 73,098 2.30% Total 3,058,381 100.00% 3,096,299 100.00% 3,113,661 100.00% Median 35.6 36.9 38.4 Population by Race Population by Race Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent White 2,045,382 66.90% 2,011,609 65.00% 1,976,024 63.50% Black 355,868 11.60% 376,430 12.20% 389,390 12.50% Native American 12,222 0.40% 12,049 0.40% 12,844 0.40% Asian 269,044 8.80% 310,431 10.00% 327,998 10.50% Hawaiian / Pacific Islander 1,243 0.00% 1,236 0.00% 1,304 0.00% Two or More 84,367 2.80% 89,977 2.90% 97,562 3.10% Other Race 290,255 9.50% 294,566 9.50% 308,539 9.90% Total 3,058,381 100.00% 3,096,299 100.00% 3,113,661 100.00%

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Hispanic Population Hispanic Population Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Hispanic 667,260 21.80% 711,489 23.00% 760,101 24.40% Not Hispanic 2,391,122 78.20% 2,384,810 77.00% 2,353,560 75.60% Total 3,058,381 100.00% 3,096,299 100.00% 3,113,661 100.00% Households by Occupancy Households by Occupancy Trends 2010 CENSUS 2016 ESTIMATE 2021 FORECAST Number Percent Number Percent Number Percent Owner Occupied 696,547 52.50% 708,844 53.30% 751,932 55.10% Renter Occupied 513,619 38.70% 549,072 41.30% 535,644 39.30% Vacant 117,241 8.80% 72,628 5.50% 76,522 5.60% Total 1,327,408 100.00% 1,330,544 100.00% 1,364,099 100.00% Daytime Population Daytime Population

2010 CENSUS 2016 ESTIMATE 2021 FORECAST

Establishments 0 172,631 0 Employees 0 2,341,173 0

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Appendix B: Comparable Courses Classic 18 Distance refers to number of miles from SCC. Types of facilities: MU – Municipal, DF – Daily Fee. Tees refers to number of teeing stations on the driving range. NPI refers to price point. “A” courses are Premium courses with a peak fee of over $70 including cart. “B” courses are considered “Standard” by NGF and have fees from $49-$70. And “C” courses are considered “Value” courses with fees under $40. We have also included the Median household income for the city in which the facility is located. Household Year Company Dist. City State Type Cat Holes NPI Architect Income Open Sportsman's Classic 18 0.0 Northbrook IL $118,480 MU JG 27 A 1931 Edward Dearie, Jr. R -Jacobson Golf Arrowhead Golf Club 25.4 Wheaton IL $85,705 MU JG 27 A 1926 Stanley Pelchar Bittersweet Golf Club 17.2 Gurnee IL $86,849 MU JG 18 B 1996 Harry Vignocchi (1996), Jack Porter, Bob Lohmann Hoffman Bridges at Poplar Creek 15.2 Estates IL $84,583 MU JG 18 B 1976 Ken Killian (1972), Dick Nugent (1972), Bob Lohmann (2011) Buffalo Grove Golf Club 5.3 Buffalo Grove IL $100,098 MU JG 18 B 1969 Ken Killian, Dick Nugent Cantigny Golf Club 25.1 Wheaton IL $85,705 DF JG 18 A 1989 Roger Packard Chick Evans Golf Course 7.3 Morton Grove IL $75,166 MU JG 18 B 1923 Dick Nugent Countryside Golf Club 12.5 Mundelein IL $76,750 MU JG B 1931

Countryside Prairie Course 18 1992 Bob Lohmann Countryside Traditional 18 1931 Course Crane's Landing Golf Club 5.0 Lincolnshire IL $102,260 DF RS 18 A 1975 : George Fazio (1975), Bob Lohmann Deerfield Golf Club 2.6 Deerfield IL $137,423 MU JG 18 A 1974 Roger Packard, Bob Lohmann Deerpath Golf Course 7.5 Lake Forest IL $155,792 MU JG 18 A 1926 Alex Pirie, Bob Lohmann Foxford Hills Golf Club 19.1 Cary IL $96,130 MU JG 18 A 2002 Tim Nugent Glencoe Golf Club 4.5 Glencoe IL $180,208 MU JG 18 B 1921 Tom Lohman Glenview Park Golf Club 5.4 Glenview IL $93,240 MU JG 18 B 1920 Joseph A. Roseman Highland Highland Park Country Club 4.3 Park IL $122,829 MU JG 18 A 1957 Dick Nugent Hoffman Highland Woods Golf Course 12.6 Estates IL $84,583 MU JG 18 B 1976 William J. Spear Lake Bluff Golf Club 10.0 Lake Bluff IL $145,500 MU JG 18 B 1968 Bob Lohman

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Household Year Company Dist. City State Type Cat Holes NPI Architect Income Open Mount Mt. Prospect Golf Club 7.1 Prospect IL $69,520 MU JG 18 A 1929 Mount Old Orchard Country Club 5.3 Prospect IL $69,520 MU JG 18 A 1939 Palatine Hills Golf Course 9.6 Palatine IL $71,573 MU JG 18 B 1965 Larry Packard (1965), Bob Lohmann Pine Meadow Golf Club 12.1 Mundelein IL $76,750 DF 18 A 1985 Schaumburg Golf Club 13.1 Schaumburg IL $74,086 MU JG 27 A 1920 Bob Lohman Shepherds Crook Golf Course 23.6 Zion IL $70,000 MU JG 18 B 1999 Keith R. Foster, ASGCA Steeple Chase Golf Course 12.8 Mundelein IL $76,750 MU JG 18 A 1993 Ken Killian, Bob Lohmann Stonewall Orchard Golf Club 18.3 Grayslake IL $81,367 DF RD 18 A 1999 Arthur Hills The Arboretum Club 6.6 Buffalo Grove IL $122,829 MU JG 18 A 1990 Dick Nugent The Glen Club 3.8 Glenview IL $100,098 DF RR 18 A 2001 Tom Fazio ThunderHawk Golf Course 20.8 Beach Park IL $93,240 MU JG 18 A 1999 Robert Trent Jones Jr Traditions At Chevy Chase 3.1 Wheeling IL $68,811 MU JG 18 A 1925 Tom Bendelow (1925), Bob Lohmann (2002) Village Links 18 hole course 22.3 Glen Ellyn IL $56,110 MU JG 18 A 1967 David Gill White Deer Run Golf Club 9.6 Vernon Hills IL $97,039 DF RD 18 A 1998 Tim & Dick Nugent Wilmette Golf Club 6.3 Wilmette IL $92,201 MU JG 18 A 1922 Joseph A. Roseman (1922), Greg Martin (2014) Winnetka Golf Club 6.3 Winnetka IL $132,110 MU JG 18 B 1914 William Langford (1914), C. D. Wagstaff (1930) Average 10.9 $96,464 18.8 1960.8

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Tees Back Tee Champ Regular Senior Forward # Range Womens Par 72 Company Par # Tees Length Slope USGA Length Slope Length Slope Length Slope Length Slope bunkers Tees Par equiv w

Sportsman's Classic 18 83 30 70 71 4 6,278 128 70.4 6,010 125 5,558 120 5,133 7,542 133 Arrowhead Golf Club 89 28 72 72 3 6,707 134 72.9 6,080 127 4,989 7,127 124 Bittersweet Golf Club 30 72 72 4 6,751 135 73.3 6,345 131 5,550 122 4,952 7,074 121 Bridges at Poplar Creek 55 70 71 4 6,500 136 71.2 6,003 132 5,313 126 4,597 6,755 124 Buffalo Grove Golf Club 55 28 72 75 4 6,693 129 72.1 6,380 126 6,026 122 5,747 8,210 127 Cantigny Golf Club 62 30 72 72 4 7,055 143 74.3 6,604 138 6,237 134 5,425 7,750 125 Chick Evans Golf Course 0 71 71 3 5,634 112 67.2 5,385 109 4,769 6,909 109 Countryside Golf Club 25

Prairie Course 72 72 3 6,757 127 72 6,276 122 5,050 7,214 119

Traditional Course 72 72 4 6,385 123 71 6,036 120 5,168 7,383 122 Crane's Landing Golf Club 32 0 70 69 4 6,290 130 71.1 5,949 127 4,728 113 3,641 5,350 103 Deerfield Golf Club 48 50 72 72 5 6,831 133 72.8 6,573 130 6,120 125 5,684 120 5,009 7,156 113 Deerpath Golf Course 64 20 70 72 4 6,255 130 70.2 6,105 129 5,470 123 5,454 8,014 123 Foxford Hills Golf Club 53 30 72 72 5 7,047 142 74.2 6,618 137 6,102 132 5,564 126 5,040 7,200 125 Glencoe Golf Club 52 20 72 73 4 6,595 133 72.3 6,291 129 6,024 70 5,713 8,161 59 Glenview Park Golf Club 77 0 70 70 3 6,113 128 69.6 5,673 123 4,874 7,162 120 Highland Park CC 45 54 71 71 4 6,479 136 71.4 6,027 131 5,455 125 4,909 7,112 122 Highland Woods 48 72 72 4 6,934 124 72.5 6,772 122 6,490 119 5,831 8,330 122 Lake Bluff Golf Club 34 21 72 72 4 6,589 124 71.3 6,195 120 5,656 114 4,969 7,099 112 Mt. Prospect Golf Club 54 9 72 70 4 6,305 135 70.3 5,955 130 5,235 119 5,065 7,236 133 Old Orchard Country Club 41 20 70 72 4 6,187 134 70.1 5,795 130 5,346 129 4,174 6,133 112 Palatine Hills Golf Course 21 72 72 4 6,820 130 72.9 6,543 127 5,913 120 5,251 7,501 121 Pine Meadow Golf Club 100 72 72 5 7,218 139 74.8 6,960 74 6,505 131 6,151 126 5,184 5,332 121 Schaumburg Golf Club 26 20 72 72 4 6,644 130 71.7 6,250 126 5,672 120 4,855 6,936 111 Shepherds Crook 0 71 71 4 6,827 130 72.1 6,272 124 6,002 120 4,901 7,100 118 Steeple Chase 36 0 72 72 5 6,863 139 73.1 6,466 135 5,976 128 5,212 120 4,831 6,901 119

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Tees Back Tee Champ Regular Senior Forward # Range Womens Par 72 Company Par # Tees Length Slope USGA Length Slope Length Slope Length Slope Length Slope bunkers Tees Par equiv w

Stonewall Orchard 35 18 72 72 4 7,124 150 75 6,506 140 6,032 137 5,375 7,679 132 The Arboretum Club 77 0 72 72 3 6,477 139 71.7 6,083 135 4,902 7,003 127 The Glen Club 64 25 72 72 4 7,170 142 75.3 6,620 135 6,062 131 5,324 7,606 129 ThunderHawk 68 40 72 72 5 7,031 141 74.2 6,631 137 6,361 134 6,124 131 5,046 7,209 125 Traditions At Chevy Chase 49 0 72 72 4 6,630 130 71.8 6,078 124 5,647 118 5,084 7,263 116 Village Links 18 89 50 72 72 5 7,208 138 74.9 6,770 134 6,382 130 6,004 126 5,439 7,770 127 White Deer Run Golf Club 72 30 72 72 5 7,149 148 74.5 6,816 144 6,484 140 6,039 135 5,028 7,183 123 Wilmette Golf Club 57 25 70 70 5 6,363 128 70.8 6,032 124 5,686 120 4,899 112 4,668 6,859 118 Winnetka Golf Club 43 30 71 72 4 6,517 130 72.6 6,278 127 5,961 124 5,568 8,066 131 Average 56.2 26 71.47 71.71 4.088 6,660 133.2 72.22 6,496 128 6,064 125 5,553 122 5,058 7,215 120

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Cart Weekday NR NR 9 Res Total NR Total Company 18 hole 9 hole NR 18 NR Twil NR Jr Res 18 Res Twil Res jr Res 9H Senior holes Senior 18 Res 18

Sportsman's Classic 18 $18.00 $10.00 $44.00 $31.00 $35.00 $25.00 $37.00 $27.00 $29.00 $25.00 $22.20 $62.00 $55.00 Arrowhead Golf Club $17.00 $8.50 $55.00 $45.00 $45.00 $27.50 $42.00 $32.00 $32.00 $21.00 $72.00 $59.00 Bittersweet Golf Club $10.00 $7.00 $35.00 $25.00 $25.00 $25.00 $20.00 $45.00 Bridges at Poplar Creek $14.00 $10.00 $35.00 $27.00 $29.00 $29.00 $23.00 $25.00 $22.00 $31.00 $31.00 $28.00 $49.00 $39.00 Buffalo Grove Golf Club $17.00 $8.50 $29.00 $24.00 $24.00 $19.00 $24.00 $20.50 $20.50 $15.50 $46.00 $41.00 Cantigny Golf Club $20.00 $12.00 $81.00 $67.00 $62.00 $42.00 $101.00 Chick Evans Golf Course $17.00 $10.00 $30.00 $23.00 $20.00 $25.00 $20.00 $15.00 $15.00 $18.00 $47.00 $42.00 Countryside Golf Club $11.00 $7.00 $31.00 $23.00 $25.00 $20.00 $20.00 $42.00 Crane's Landing $10.00 $6.00 $39.00 $29.00 $29.00 $19.00 $29.00 $35.00 $24.00 $25.00 $15.00 $24.00 $49.00 $45.00 Deerfield Golf Club $19.00 $13.00 $49.00 $32.00 $33.00 $23.00 $32.00 $42.00 $28.00 $29.00 $21.00 $29.00 $68.00 $61.00 Deerpath Golf Course $19.00 $12.00 $54.00 $37.00 $48.60 $40.00 $48.60 $33.30 $45.90 $36.00 $73.00 $67.60 Foxford Hills Golf Club $12.00 $0.00 $57.00 $35.00 $39.00 $25.00 $39.00 $47.00 $30.00 $36.00 $19.00 $36.00 $69.00 $59.00 Glencoe Golf Club $17.00 $11.00 $43.00 $28.00 $26.00 $22.00 $27.00 $60.00 Glenview Park Golf Club $18.00 $11.00 $42.00 $29.00 $37.00 $26.00 $60.00 $55.00 Highland Park CC $18.00 $12.00 $41.00 $27.00 $25.00 $25.00 $27.00 $37.00 $24.00 $20.00 $20.00 $24.00 $59.00 $55.00 Highland Woods $17.00 $10.00 $38.00 $26.00 $35.00 $33.00 $24.00 $19.00 $19.00 $23.00 $55.00 $50.00 Lake Bluff Golf Club $16.00 $10.00 $40.00 $25.00 $35.00 $35.00 $25.00 $37.00 $22.00 $32.00 $32.00 $22.00 $56.00 $53.00 Mt. Prospect Golf Club $18.00 $11.00 $43.00 $26.00 $34.00 $34.00 $24.00 $33.00 $23.00 $26.00 $26.00 $20.00 $61.00 $51.00 Old Orchard Country Club $43.00 $68.00 $40.00 $20.00 $41.00 $45.50 $42.50 $19.00 $30.50 $68.00 $45.50 Palatine Hills Golf Course $18.00 $11.00 $41.00 $31.00 $31.00 $31.00 $22.00 $37.00 $29.00 $29.00 $25.00 $20.00 $59.00 $55.00 Pine Meadow Golf Club $17.00 $10.00 $62.00 $39.50 $39.50 $79.00 Schaumburg Golf Club $19.00 $1.50 $44.00 $33.00 $28.00 $24.00 $22.00 $31.00 $22.00 $25.00 $24.00 $15.00 $63.00 $50.00 Shepherds Crook $15.00 $35.00 $20.00 $15.00 $5.00 $25.00 $15.00 $5.00 $5.00 $50.00 $40.00 Steeple Chase $18.00 $11.00 $49.00 $32.00 $34.00 $27.00 $33.00 $23.00 $23.00 $19.00 $67.00 $51.00 Stonewall Orchard $16.00 $8.00 $68.00 $39.00 $39.00 $40.00 $27.00 $84.00 The Arboretum Club $20.00 $10.50 $47.00 $27.00 $31.00 $26.00 $36.00 $21.00 $25.00 $21.00 $67.00 $56.00 The Glen Club $25.00 $130.00 $130.00 $104.00 $104.00 $155.00

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Cart Weekday NR NR 9 Res Total NR Total Company 18 hole 9 hole NR 18 NR Twil NR Jr Res 18 Res Twil Res jr Res 9H Senior holes Senior 18 Res 18

ThunderHawk $15.00 $10.00 $55.00 $39.00 $45.00 $39.00 $30.00 $70.00 Traditions At Chevy Chase $20.00 $11.00 $45.00 $26.00 $28.00 $28.00 $26.00 $40.00 $21.00 $23.00 $23.00 $21.00 $65.00 $60.00 Village Links 18 $20.00 $12.00 $57.00 $36.00 $20.00 $38.00 $28.00 $24.00 $15.50 $77.00 $58.00 White Deer Run Golf Club $10.00 $6.00 $65.00 $39.00 $41.00 $36.00 $27.00 $54.00 $33.00 $41.00 $30.00 $23.00 $75.00 $64.00 Wilmette Golf Club $19.00 $12.00 $52.00 $33.00 $26.00 $46.00 $30.00 $26.00 $71.00 $65.00 Winnetka Golf Club $18.00 $11.00 $44.00 $31.00 $32.00 $29.00 $29.00 $62.00 Average $16.81 $9.43 $49.18 $34.88 $34.19 $28.79 $27.65 $39.68 $28.60 $27.18 $22.50 $23.03 $66.24 $53.21

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Weekend NR NR NR 9 Res Total NR Total Company NR 18 NR Twil NR Super NR Jr Res 18 Res Twil Res Jr Res 9H Midday Senior holes Senior 18 Res 18

Sportsman's Classic 18 $55.00 $47.00 $39.00 $33.00 $46.00 $32.00 $73.00 $64.00 Arrowhead Golf Club $65.00 $45.00 $45.00 $32.50 $47.00 $32.00 $32.00 $23.50 $82.00 $64.00 Bittersweet Golf Club $57.00 $35.00 $30.00 $25.00 $67.00 Bridges at Poplar Creek $55.00 $40.00 $25.00 $25.00 $20.00 $45.00 $20.00 $15.00 $69.00 $59.00 Buffalo Grove Golf Club $42.00 $29.00 $16.00 $34.00 $24.00 $59.00 $51.00 Cantigny Golf Club $97.00 $57.00 $67.00 $62.00 $42.00 $117.00 Chick Evans Golf Course $33.00 $25.00 $22.00 $27.00 $22.00 $15.00 $15.00 $19.00 $50.00 $44.00 Countryside Golf Club $44.00 $39.00 $27.00 $25.00 $55.00 Crane's Landing $49.00 $34.00 $29.00 $45.00 $31.00 $59.00 $55.00 Deerfield Golf Club $57.00 $36.00 $36.00 $51.00 $33.00 $33.00 $76.00 $70.00 Deerpath Golf Course $57.00 $47.00 $39.00 $51.30 $40.00 $51.30 $35.10 $48.45 $36.00 $76.00 $70.30 Foxford Hills Golf Club $79.00 $63.00 $35.00 $25.00 $40.00 $69.00 $30.00 $19.00 $35.00 $91.00 $81.00 Glencoe Golf Club $52.00 $33.00 $23.00 $28.00 $23.00 $69.00 Glenview Park Golf Club $52.00 $31.00 $20.00 $47.00 $28.00 $70.00 $65.00 Highland Park CC $57.00 $43.00 $57.00 $57.00 $43.00 $47.00 $35.00 $47.00 $47.00 $75.00 $65.00 Highland Woods $43.00 $27.00 $27.00 $38.00 $24.00 $24.00 $60.00 $55.00 Lake Bluff Golf Club $51.00 $40.00 $30.00 $21.00 $32.00 $48.00 $29.00 $29.00 $67.00 $64.00 Mt. Prospect Golf Club $54.00 $32.00 $28.00 $39.00 $25.00 $23.00 $72.00 $57.00 Old Orchard Country Club $65.00 $65.00 $48.00 $60.50 $60.50 $18.00 $39.50 $65.00 $60.50 Palatine Hills Golf Course $47.00 $35.00 $42.00 $25.00 $42.00 $32.00 $23.00 $65.00 $60.00 Pine Meadow Golf Club $76.00 $62.00 $39.50 $34.50 $93.00 Schaumburg Golf Club $55.00 $39.00 $25.00 $42.00 $26.00 $74.00 $61.00 Shepherds Crook $45.00 $20.00 $30.00 $20.00 $60.00 $45.00 Steeple Chase $74.00 $49.00 $40.00 $27.00 $58.00 $29.00 $19.00 $92.00 $76.00 Stonewall Orchard $79.00 $39.00 $40.00 $27.00 $95.00 The Arboretum Club $57.00 $36.00 $21.00 $47.00 $26.00 $77.00 $67.00 The Glen Club $195.00 $165.00 $130.00 $105.00 $156.00 $104.00 $220.00

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Weekend NR NR NR 9 Res Total NR Total Company NR 18 NR Twil NR Super NR Jr Res 18 Res Twil Res Jr Res 9H Midday Senior holes Senior 18 Res 18

ThunderHawk $89.00 $77.00 $40.00 $35.00 $89.00 Traditions At Chevy Chase $77.00 $68.00 $26.00 $19.00 $72.00 $21.00 $77.00 $72.00 Village Links 18 $62.00 $36.75 $26.00 $25.00 $45.00 $34.00 $18.00 $82.00 $65.00 White Deer Run Golf Club $79.00 $49.00 $39.00 $36.00 $27.00 $66.00 $33.00 $30.00 $23.00 $89.00 $76.00 Wilmette Golf Club $56.00 $37.00 $25.00 $31.00 $51.00 $32.00 $31.00 $75.00 $70.00 Winnetka Golf Club $52.00 $35.00 $24.00 $32.00 $29.00 $70.00 Average $63.85 $59.86 $36.91 $30.11 $49.33 $39.00 $31.02 $52.15 $31.53 $40.59 $27.43 $25.71 $79.09 $63.20

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Range Passes Age Age # WD NR Res WD Res NR Res NR Res Company Small Medium # balls Large # balls NR Indiv Senior Junior balls Indiv Indiv Indiv Family Fam Senior Senior

Sportsman's Classic 18 65 17 $5.00 30.0 $7.00 50.0 $9.00 80.0 Arrowhead Golf Club 60 $5.00 40.0 $10.00 80.0 Bittersweet Golf Club 60 17 $1,249 $1,049 $1,149 Bridges at Poplar Creek 60 17 $800 $500 Buffalo Grove Golf Club 65 18 $3.75 22.5 $7.50 42.5 $1,600 $925 $1,100 $785 $1,450 $1,100 $885 $750 Cantigny Golf Club 60 17 Chick Evans Golf Course 62 17 Countryside Golf Club 62 17 $6.00 35.0 $8.00 70.0 $10.00 105.0 Crane's Landing $2,595 $750 $4,995 Deerfield Golf Club $1,650 $1,312 $1,312 $1,032 $1,096 $892 Deerpath Golf Course 65 $4.00 25.0 $6.00 40.0 $15.00 110.0 $1,800 $1,400 $2,400 $2,300 $1,100 $850 Foxford Hills Golf Club 62 18 $1,999 $1,599 $1,499 $1,199 $2,999 $2,499 $1,399 $999 Glencoe Golf Club 60 $7.00 35.0 $11.00 70.0 Glenview Park Golf Club $1,500 $1,100 $1,350 $1,000 Highland Park CC $10.00 $12.00 $15.00 $2,900 $1,300 $2,600 $1,000 $2,600 $2,300 Highland Woods 62 17 $6.00 $12.00 Lake Bluff Golf Club 62 22 $1,595 $1,100 $1,250 $910 $2,695 $2,125 $1,065 $825 Mt. Prospect Golf Club 62 17 $5.00 35.0 $10.00 70.0 $15.00 105.0 $1,550 $1,125 $1,050 Old Orchard Country Club 65 17 $4.00 $7.50 $3,200 $1,500 $1,500 Palatine Hills Golf Course 62 17 $3.75 27.5 Pine Meadow Golf Club Schaumburg Golf Club 55 17 Shepherds Crook Steeple Chase 55 Stonewall Orchard 55 17 $5.00 25.0 $7.00 40.0 $11.00 75.0 $4,195 $3,195 $2,350 The Arboretum Club The Glen Club $12.00

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Range Passes Age Age # WD NR Res WD Res NR Res NR Res Company Small Medium # balls Large # balls NR Indiv Senior Junior balls Indiv Indiv Indiv Family Fam Senior Senior

ThunderHawk 62 17 $6.00 35.0 $8.00 70.0 $10.00 105.0 Traditions At Chevy Chase 60 18 Village Links 18 White Deer Run Golf Club 55 17 Wilmette Golf Club 65 17 $5.00 35.0 $8.00 70.0 $15.00 150.0 $2,145 $1,505 $1,450 $1,020 $2,145 $1,410 Winnetka Golf Club 65 18 $7.00 40.0 $10.00 80.0 $1,283 $855 $2,085 $815 Average 61 17 $5.83 31.4 $8.25 58.6 $11.38 92.3 $2,094 $1,394 $1,401 $1,063 $2,908 $2,006 $1,532 $1,135

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Google Golf Now Golf Advisor rating Season Rating Golf Golf Golf Golf Now Google Now Advisor Advisor Chigago Company Open Close # # Rating 12 # # #` Concensus Rating Rating rating rating 12 Golf Guide mon ALL ALL mon Sportsman's Classic 18 1-Mar 15-Dec 4.2 33 3.5 2 3.0 1 3.5 2 3 1 4 4.1 Arrowhead Golf Club 1-Apr 15-Dec 4.5 92 4.4 182 4.1 27 4.3 182 4.1 28 4 4.3 Bittersweet Golf Club 15-Mar 15-Nov 4.3 27 4.3 73 4.5 14 4.3 73 4.5 16 3 4.0 Bridges at Poplar Creek 1-Apr 31-Oct 4.3 45 3.7 182 4.0 21 3.9 182 4 23 3.5 3.9 Buffalo Grove Golf Club open open 4.0 25 3.8 95 4.1 11 3.9 95 4.1 13 3 3.7 Cantigny Golf Club 15-Apr 31-Oct 4.7 23 4.6 107 4.8 8 4.8 106 5 11 4.5 4.7 Chick Evans Golf Course 42809 43084 3.8 39 3.2 52 3.4 14 3 52 3.2 15 3 3.3 Countryside Golf Club 4.1 34 4 107 4 1 2.5 3.5 Crane's Landing 15-Apr 31-Oct 3.4 19 3.9 79 3.6 5 4 78 3.5 4 3.8 Deerfield Golf Club 1-Apr 1-Dec 3.9 14 3.9 136 4.4 29 4.1 136 4.2 33 4.5 4.1 Deerpath Golf Course 1-Mar 15-Nov 3.8 13 3.7 69 3.5 10 3.9 68 3.2 10 3 3.6 Foxford Hills Golf Club 4.1 14 4.1 144 4.1 32 4 143 4 33 3.5 3.9 Glencoe Golf Club 5-Mar 15-Nov 4.5 32 5 1 nr 3.5 4.0 Glenview Park Golf Club 1-Apr 1-Dec 4.3 24 4.4 30 4.3 23 4.3 28 4.3 25 2.5 3.9 Highland Park CC open open 4.2 16 4.0 79 3.8 23 4 79 4 23 4 4.1 Highland Woods open open 3.6 42 3.0 121 3.3 23 3 121 3.1 26 3.5 3.3 Lake Bluff Golf Club 1-Apr 1-Dec 3.9 12 4.2 57 4.3 10 4.1 57 4.3 11 3.5 3.9 Mt. Prospect Golf Club 1-Apr 30-Nov 4.2 39 4.2 100 4.3 61 4.1 96 4.1 62 3.5 4.0 Old Orchard Country Club 15-Mar 30-Nov 4.1 29 3.6 83 3.9 15 3.9 83 4 18 4 3.9 Palatine Hills Golf Course 1-Apr 30-Nov 3.8 34 4.2 14 4.3 8 4.1 14 4.3 9 3 3.8 Pine Meadow Golf Club 3.3 34 3.0 14 Schaumburg Golf Club 1-Mar 30-Nov 4.2 32 4.1 337 4.4 51 4 336 4.3 62 3 3.8 Shepherds Crook 1-Apr 1-Nov 4.3 20 4.4 78 17 4.4 Steeple Chase 15-Mar 1-Dec 3.7 11 4.3 34 4.1 13 4.1 33 4 12 4 4.0 Stonewall Orchard 1-Apr 30-Sep 4.5 32 4.5 117 4.4 24 4.5 116 4.4 25 4 4.4 The Arboretum Club 1-Mar 1-Dec 4.0 11 3.9 60 3.8 5 4 172 4 30 3.5 3.9

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Google Golf Now Golf Advisor rating Season Rating Golf Golf Golf Golf Now Google Now Advisor Advisor Chigago Company Open Close # # Rating 12 # # #` Concensus Rating Rating rating rating 12 Golf Guide mon ALL ALL mon The Glen Club 3.9 9 4.1 173 4.0 29 5 2 nr 3.5 3.8 ThunderHawk 1-Apr 15-Nov 4.5 106 4.5 74 nr 4 4.3 Traditions At Chevy Chase 1-Apr 1-Dec 4.5 30 3.9 73 3.9 31 3 3.8 Village Links 18 15-Apr 15-Nov 4.5 25 3.6 73 3.7 28 3.9 3 4 2 3.5 3.9 White Deer Run Golf Club 1-May 1-Oct 4.3 54 4.1 94 5 1 3.5 4.0 Wilmette Golf Club 15-Mar 1-Nov 4.5 13 2.9 6 4.5 2 3.5 3.6 Winnetka Golf Club 1-Apr 31-Oct 4.2 29 3.3 47 3 13 3.5 3.7 Average 25-Mar 17-Nov 4.1 31 3.9 97 4.0 20 4.025 85.5 4.4483 19 3.5 3.9

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Rounds Revenue Company 2015 2016 Total Golf Rev GF Cart Range Lessons F&B Banquet Merch

Sportsman's Classic 18 29,131 27,564 $2,601,566 $1,735,242 $1,408,148 $315,809 $251,139 $364,832 $15,014 $230,805 Arrowhead Golf Club 50,980 55,800 $7,681,258 $2,088,856 $1,613,450 $311,078 $103,873 $18,889 $5,230,154 $2,449,072 $146,866 Bittersweet Golf Club Bridges at Poplar Creek 31,279 $2,436,475 $1,376,426 $481,215 $405,800 $132,415 $34,055 $994,131 $91,650 Buffalo Grove Golf Club 36,971 28,886 $1,047,259 $951,515 $685,129 $208,299 $58,014 $70,139 Cantigny Golf Club $7,657,905 Chick Evans Golf Course 41,160 Countryside Golf Club $1,928,240 $1,676,643 $1,090,560 $399,391 $90,917 $248,245 $38,133 Crane's Landing Deerfield Golf Club Deerpath Golf Course 27,956 29,445 $1,759,271 Foxford Hills Golf Club Glencoe Golf Club $1,732,615 Glenview Park Golf Club 36,684 13,260 $1,887,122 $812,000 $220,000 $122,000 Highland Park CC Highland Woods 52,275 Lake Bluff Golf Club Mt. Prospect Golf Club 32,964 $785,626 $281,920 $77,826 $42,000 $47,085 Old Orchard Country Club 23,897 $1,253,275 $981,914 $129,935 $132,204 Palatine Hills Golf Course 35,440 $1,186,332 $896,939 $252,146 Pine Meadow Golf Club Schaumburg Golf Club $2,219,182 $1,392,626 $321,225 $54,680 $122,875 $257,771 Shepherds Crook $951,290 $695,187 $578,937 $116,250 Steeple Chase 24,145 24,019 $1,406,967 $825,730 $297,222 $3,649 $180,788 $78,424 Stonewall Orchard The Arboretum Club 31,631 24,709 $1,193,609 $750,853 $234,655 $58,066 The Glen Club ThunderHawk $1,340,372 $1,287,514 $854,773 $268,641 $38,359 $52,858 $106,828

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Rounds Revenue Company 2015 2016 Total Golf Rev GF Cart Range Lessons F&B Banquet Merch Traditions At Chevy Chase 31,791 30,689 $4,684,721 $1,373,751 $1,020,855 $346,233 $3,057,274 $103,566 Village Links 18 72,000 $5,158,503 $2,783,223 $1,800,477 $476,768 $261,761 $2,218,977 $192,850 White Deer Run Golf Club Wilmette Golf Club 32,500 31,000 $1,854,154 $1,569,511 $764,423 $181,958 $114,707 $68,142 $131,979 Winnetka Golf Club 44,233 $1,797,384 $525,000 $108,000 $131,000 $16,000 $140,365 Average 34,450 34,786 $2,588,875 $1,480,793 $971,635 $279,141 $119,517 $101,928 $1,025,688 $2,449,072 $121,782

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Operating Expenses (exl depreciation) Golf # FT Maint # Maint Company Total NOI Maint Total Payroll golf Payroll Advertising Admin Fee Operations Emp Payroll Empl Sportsman's Classic 18 $2,513,664 ($88,871) $918,879 $638,236 $863,792 9 $453,578 23 $359,045 $45,000 Arrowhead Golf Club $7,010,655 $670,603 $996,000 $652,000 $3,079,302 $490,082 23 $349,057 $200,000 Bittersweet Golf Club Bridges at Poplar Creek $2,189,741 $246,734 $604,024 6 $360,642 $263,212 $280,466 Buffalo Grove Golf Club $1,142,923 ($95,664) $426,560 Cantigny Golf Club Chick Evans Golf Course Countryside Golf Club $2,112,211 ($183,971) $1,359,814 Crane's Landing Deerfield Golf Club Deerpath Golf Course $1,669,633 $89,638 $610,422 2 $7,556 $25,572 Foxford Hills Golf Club Glencoe Golf Club $1,506,891 $225,724 $695,818 Glenview Park Golf Club $1,910,897 ($23,775) $822,698 5 Highland Park CC Highland Woods Lake Bluff Golf Club Mt. Prospect Golf Club $1,427,624 $713,684 $806,316 $811,796 $386,075 15 $425,721 $0 Old Orchard Country Club $1,268,449 ($15,174) $430,025 Palatine Hills Golf Course $1,292,347 ($106,015) $739,759 Pine Meadow Golf Club Schaumburg Golf Club $2,165,868 $53,314 $974,785 5 Shepherds Crook $836,232 $115,058 $369,056 $412,311 $203,783 $208,528 Steeple Chase $1,376,627 $30,340 $682,070 $678,053 7 $374,181 $251,085 $11,495 Stonewall Orchard The Arboretum Club $1,306,865 ($113,256) $214,990 $146,695 The Glen Club ThunderHawk $1,128,181 $212,191 $610,749

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Operating Expenses (exl depreciation) Golf # FT Maint # Maint Company Total NOI Maint Total Payroll golf Payroll Advertising Admin Fee Operations Emp Payroll Empl Traditions At Chevy Chase $4,155,793 $528,928 $1,763,943 10 $441,171 $56,887 Village Links 18 $4,585,449 $573,054 $776,404 $1,652,897 12 $389,401 $325,506 $98,573 White Deer Run Golf Club Wilmette Golf Club $1,553,982 $300,172 $901,631 $802,930 7 13 $398,755 Winnetka Golf Club $1,845,203 ($47,819) $960,412 $792,207 $952,062 3 20 $62,090 Average $2,149,962 $124,801 $769,129 $722,190 $982,651 7 $387,364 19 $299,643 $43,628 $144,822

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East 9 These are nine-hole courses.

Household Year Company Dist. City State Type Cat Holes NPI Architect Income Open

Sportsmans East Course 1990 Jacobson Golf Village Links 9 hole 9 David Gill Prospect Rob Roy Golf Club 4.2 Heights IL MU JG 9 C 1930 Edward B. Dearie Mission Hills CC 1.1 Northbrook IL DF JG 9 C 1926 Larry & Roger Packard Willowhill Golf Course 3.6 Northbrook IL DF JG 9 C 1995 Dick Nugent Average 3.0 9.0 1960.3

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Cart Weekday NR NR 9 Res Total NR Total Company 18 hole 9 hole NR 18 NR Twil NR Jr Res 18 Res Twil Res jr Res 9H Senior holes Senior 18 Res 18

Sportsmans East Course $10.00 $19.00 $20.00 $15.00 $24.00 $15.00 $17.00 $15.00 $20.00 $34.00 $30.00 Village Links 9 hole $12.00 $20.00 $10.50 $10.00 $15.50 $32.00 $27.50 Rob Roy Golf Club $14.00 $9.00 $18.00 $15.00 $27.00 $24.00 Mission Hills CC $12.00 $20.00 $20.00 $32.00 $32.00 Willowhill Golf Course $11.00 $18.00 $20.00 $20.00 $31.00 Average $14.00 $10.80 $19.00 $19.00 $17.50 $20.40 $15.00 $13.75 $12.50 $17.63 $31.20 $28.38

Weekend NR NR NR 9 Res Total NR Total Company NR 18 NR Twil NR Super NR Jr Res 18 Res Twil Res Jr Res 9H Midday Senior holes Senior 18 Res 18

Sportsmans East Course $21.00 $29.00 $17.00 $24.00 $39.00 $34.00 Village Links 9 hole $25.00 $18.00 $37.00 $30.00 Rob Roy Golf Club $20.00 $17.00 $29.00 $26.00 Mission Hills CC $25.00 $25.00 $37.00 $37.00 Willowhill Golf Course $20.00 $18.00 $20.00 $25.00 $36.00 Average $20.50 $18.00 $20.00 $24.80 $17.00 $21.00 $35.60 $31.75

Range Passes WD WD Age Age # NR Res NR Res NR Res Company Small Medium # balls Large # balls NR Res Senior Junior balls Indiv Indiv Family Fam Senior Senior Indiv Indiv Sportsmans East Course $5.00 30.0 $7.00 50.0 $9.00 80.0 Village Links 9 hole 65 21 $5.00 $7.50 $10.00 Rob Roy Golf Club $5.00 32.5 $7.00 62.5 $17.00 215.0 $595 $495 Mission Hills CC $325 $325 $375 $375 Willowhill Golf Course 62 17 $6.00 25.0 $12.00 75.0 Average 63.5 19.0 $5.25 29.2 $7.17 56.3 $12.00 123.3 $460 $410 $375 $375

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Google Golf Now Golf Advisor rating Season Rating Golf Golf Golf Golf Now Google Now Advisor Advisor Chigago Company Open Close # # Rating 12 # # #` Concensus Rating Rating rating rating Golf Guide mon ALL ALL 12 mon Sportsmans East Course 1-Mar 15-Dec 4.2 33 na na 0 4.2 Village Links 9 hole 15-Apr 15-Nov 4.3 54 3.9 3 4 2 2.7 Rob Roy Golf Club 1-Apr 30-Nov 4.2 25 3.7 19 3.5 10 3.9 19 3.5 10 3 3.7 Mission Hills CC 15-Mar 30-Nov 3.2 25 2.8 208 2.1 10 3 207 2.1 9 3.5 3.1 Willowhill Golf Course 1-Mar 15-Dec 3.9 7 NR nr 4 4.0 Average 19-Mar 3-Dec 4.0 28.8 3.3 113.5 2.8 10.0 3.6 76.3 3.2 5.3 3.5 3.5

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Anetsberger These are Par 3 facilities.

Year # Range 18h 18 h Company Dist. City State Type Cat Holes NPI Architect # Tees Open bunkers Tees Par Length

Addison Links & Tees 15.5 Addison IL MU JG 9 C 1984 14 72 54 1 2,322 Anetsberger Golf Course 2.8 Northbrook IL MU JG 9 C 1949 Rick Jacobson 4 0 54 2 2,256 Cantigny Youth Links 25.1 Wheaton IL DF 9 1989 Roger Packard 3 54 1 1,978 Golf Center Des Plaines 5.7 Des Plaines IL MU JG 9 C 1997 Rick Jacobson 10 80 54 1 2,010 Lake Park Golf Course 8.6 Des Plaines IL MU JG 18 C 1961 20 0 54 1 1,515 Arlington Nickol Knoll Golf Club 6.6 Heights IL MU JG 9 C 1995 Steven Halberg 20 0 54 3 2,466 Walnut Greens 14.8 Schaumburg IL MU JG 9 C 1988 Ken Killian, Dick Nugent 5 0 54 2 2,156 Weber Park Golf Course 8.5 Skokie IL MU JG 9 C 1973 Ken Killian, Dick Nugent 11 0 54 2,190 Winnetka Par 3 course Winnetka IL 9 1904 William Langford 15 30 54 1 2,388 Average 10.9 10.0 1971.1 11.3 22.8 54.0 1.5 2,142

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Cart Weekday NR NR 9 Res Total NR Total Company 18 hole 9 hole NR 18 NR Twil NR Jr Res 18 Res Twil Res jr Res 9H Senior holes Senior 18 Res 18

Addison Links & Tees $15.00 $10.00 $12.00 $12.00 $12.00 $10.00 $10.00 $10.00 $15.00 $12.00 Anetsberger Golf Course $13.00 $12.00 $10.00 $13.00 Cantigny Youth Links $12.00 $12.00 $12.00 Golf Center Des Plaines $13.00 $18.00 $11.00 $11.00 $11.00 $15.00 $9.00 $9.00 $13.00 $11.00 Lake Park Golf Course $13.50 $11.00 $11.00 $13.50 $11.00 $9.00 $9.00 $11.00 $13.50 $11.00 Nickol Knoll Golf Club $8.00 $13.00 $10.00 $10.00 $13.00 Walnut Greens Golf $8.00 $8.00 $11.50 $9.50 $17.50 $10.00 $8.50 $19.50 $18.00 Weber Park Golf Course $12.00 $10.00 $10.00 $10.00 $8.00 $8.00 $12.00 $10.00 Winnetka Par 3 course $14.00 $12.00 $12.00 $14.00 Average $13.00 $14.00 $10.94 $11.00 $15.50 $10.80 $12.50 $8.90 $9.00 $11.00 $13.89 $12.40

Weekend NR NR NR 9 Res Total NR Total Company NR 18 NR Twil NR Super NR Jr Res 18 Res Twil Res Jr Res 9H Midday Senior holes Senior 18 Res 18

Addison Links & Tees $15.00 $10.00 $12.00 $12.00 $12.00 $10.00 $10.00 $10.00 $15.00 $12.00 Anetsberger Golf Course $15.00 $13.00 $11.00 $15.00 Cantigny Youth Links $12.00 $12.00 $12.00 Golf Center Des Plaines $15.00 $18.00 $13.00 $15.00 $15.00 $13.00 Lake Park Golf Course $14.50 $13.00 $13.00 $14.50 $12.00 $11.00 $11.00 $12.00 $14.50 Nickol Knoll Golf Club $15.00 $15.00 Walnut Greens Golf $13.50 $21.50 $11.50 $21.50 $19.50 Weber Park Golf Course $12.00 $10.00 $10.00 $10.00 $8.00 $8.00 $12.00 $10.00 Winnetka Par 3 course $15.00 $13.00 $13.00 $15.00 Average $14.11 $14.00 $12.20 $11.83 $18.00 $11.70 $12.50 $9.67 $9.67 $12.00 $15.00 $13.63

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Range Passes WD WD Age Age Res NR Res NR Res Company Small # balls Medium # balls Large # balls NR Indiv NR Res Senior Junior Indiv Family Fam Senior Senior Indiv Indiv Addison Links & Tees $10.00 75.0 $12.00 105.0 $17.00 180.0 Anetsberger Golf Course 65 17 $219 $179 Cantigny Youth Links $225 Golf Center Des Plaines 60 17 $15.00 125.0 $30.00 250.0 $50.00 458.0 $450 Lake Park Golf Course 60 17 $375 $325 $350 $300 Nickol Knoll Golf Club 60 17 Walnut Greens Weber Park Golf Course 60 18 $100 $80 $85 $65 Winnetka Par 3 course 65 18 $375 Average 61.7 17.3 $25.00 100.0 $42.00 177.5 $67.00 319.0 $1,744 $405 $614 $365

Rounds Revenue

Company 2015 2016 Total Golf Rev GF Cart Range Lessons F&B Banquet Merch

Addison Links & Tees $246,617 $32,325 $2,500 Anetsberger Golf Course 10,834 $125,937 $106,441 $19,496 Cantigny Youth Links Golf Center Des Plaines $1,559,968 $225,620 $1,100,796 $33,035 $90,021 Lake Park Golf Course $183,666 $101,250 $908 $1,202 Nickol Knoll Golf Club 15,421 16,771 $211,890 $155,565 $18,819 Walnut Greens $125,169 $107,605 $9,347 $8,165 Weber Park Golf Course Winnetka Par 3 course Average 15,421 13,803 $408,875 $147,510 $14,083 $566,561 $16,972 $90,021 $7,841

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Operating Expenses (exl depreciation) Golf Total Maint # Maint golf Admin Company Total NOI Maint # FT Emp Advertising Operations Payroll Payroll Empl Payroll Fee

Addison Links & Tees $313,113 ($66,496) $80,000 $135,184 3 $25,000 Anetsberger Golf Course $97,746 $17,052 $49,668 $48,078 $57,212 Cantigny Youth Links Golf Center Des Plaines $1,033,471 $526,497 $56,500 Lake Park Golf Course $208,251 ($24,585) Nickol Knoll Golf Club $259,565 ($47,675) $160,616 1 Walnut Greens $153,798 ($28,629) $113,370 Weber Park Golf Course Winnetka Par 3 course Average $344,324 $62,694 $64,834 $48,078 $116,595 $40,750

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Appendix C: Impact of Renovations Impact of Renovations Because of the number of major renovations that have taken place among DFW municipal golf courses in recent years, we have a wonderful opportunity to be able to see how these renovations have impacted performance. We looked at 11 different courses that have undergone renovations in the past 10 years. These are: Luna Vista, Cedar Crest, Stevens Park, Indian Creek (2 courses), Lake Arlington, Meadowbrook, Pecan Hollow, Course at Water’s Creek, Hawk’s Creek and Pecan Valley Hills Course. The following table summarizes our findings. Hawk’s Creek is left out of the table due to the fact it was mostly rebranding, which we discuss in greater detail later.

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Four of the ten renovations were done for under $1,000,000. The rest were major renovations, ranging in costs from $3,500,000 to $10,100,000. Combined, the average cost was $4,067,800. On average, the courses were closed for 7.2 months during the renovation. We will look at the impact by three different measures: rounds, revenue and yield. We looked at performance for the last FULL year before renovations and the first two FULL years after renovation. (We only went two years because so many of them only had two full years of data). Rounds Three of the facilities (30%) had their rounds go down in the first year, and a fourth had very similar rounds. The other six saw substantial increases. Overall, rounds increased by 3.9% or 3,219 rounds. On average, rounds rose another 3,265 rounds in the 2nd full year after renovations. This represented an average 12.3% increase over the prerenovation rounds. Again, three courses had decreases while the rest increased. Notably, all three of the courses that had declining rounds were ones that had less than $1 million in renovations. Revenue In looking at revenue, it is important to understand that some municipalities only receive green fee revenue, so that is the only figure we have. For others, we have total revenue. But in both cases, the revenue calculation was the same before and after renovations so the comparison is still valid. In the year before renovations, the ten courses averaged $1,195,837, In the first year after renovations, the average jumped to $1,692,488. This is an average increase of just under ½ million dollars ($496,651). EVERY COURSE REPORTED AN INCREASE IN REVENUE. The average increase was 47.7%. In the second year, revenues continued to increase, with an average bump of $195,402. This represents an average increase of 55.2% over the pre-renovation figures. However, two of the courses did have a decrease in revenue in the 2nd year, although it was still higher than before the renovations. Yield As the astute reader may have noticed, the revenue increased at all the courses, even though three of them had a decrease in rounds. This is because every facility reported a dramatic increase in yield. Yield is the amount of revenue divided by the number of rounds. Pre-renovation, the average reported yield was $26.58/round. In the first full year after renovation, the yield increased by an average of 18.2% to $31.16. In the second year, the yield continued to increase an average of 4.5%. However, two of the facilities had a decrease in yield,

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Return on Investment Next, we looked at the return on investment (ROI). For this we simply took the improvement in revenue for the year and divided by the cost of the improvements. As we do not know all the internal financials, we cannot say if the improvements made the courses profitable, nor can we say whether the improvements covered the debt service as it would depend entirely on how it was financed. But we can say is that from a business perspective, an ROI of 10% or more would be considered very good. An ROI over 15% would be considered outstanding. The average return on investment was 62% in year one and 85.2% in year two. However, these figures are distorted by two courses, Indian Creek Lakes and Hawk’s Creek, who invested relatively little in the renovation, but made major operational changes, including “rebranding”. When we look at just those facilities that spent over $1,000,000, we find the ROI in the first year, average 6.7%, but the ROI in the 2nd year was an outstanding 18.1%. (We understand that the third- year performance for the facilities who improvements are more than three years old, exceeded the 2nd year in both cases). Major vs. Minor Renovations Six of the facilities had major renovations, costing over $3 million (average $6.5 m), while four had renovations costing under $1 million (average $444,500). We wanted to see if there was a significant difference in results. Rounds The major renovators averaged 11.2% increase in the first year and a 22.7% increase over base in the 2nd year. This compares to 8% in the first and 1.9% in the 2nd for the minors. Indeed, three of the four courses with minor renovations saw a decrease in play from the first to the 2nd year. The exception being Indian Creek Lakes. When Lakes is removed, the average first year change was a 1.5% decline and the average 2nd year was a 13.1% decline. Revenue In the first year, the Majors averaged a 61.3% increase in revenue ($502,938 on average), compared to 27.5% for the minors ($487,138). In the 2nd year, the majors increased another $309,228 on average, for a total increase of 86.4% over base. The minors, however, went down slightly ($1,394). However, this was due to one facility, Lake Arlington, who suffered a loss of their greens in the third year, although a 2nd, Pecan Valley, also had a slight decrease. Yield Surprisingly, there was not much difference between the two groups in change in yield. Both groups went up about 18.2% in the first year. In the second year, the Minors averaged a 22.4% increase over base, compared to 18.2% for the majors. Return on Investment The average ROI for the Majors was just 6.2% after the first year, compared to a whopping 440% by the Minors. In the 2nd year, the Majors improved to 18.3%, but the minors were still strong at 152.3%.

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Again, though, Indian Creek Lakes was the big outlier in the Minors. When Indian Creek is removed, the ROI in the first-year falls to 45.5% and the 2nd year, 26%. Both, though, are still outstanding. Conclusion Clearly, minor renovations can have a major impact, especially if done with other significant changes such as management and rebranding. The latter was the case at both Hawks Creek (which was not included in the analysis) and Indian Creek (which was). We will discuss these two in greater detail below. However, the major impacts also appear to pay for themselves, in terms of ROI and dramatic revenue increases. Further, their impact seems to increase over time, while the minors had a big bump in the first year, followed by a settling down in the 2nd. Thus, minor renovations may help, but will not likely provide long-term solutions unless they are also accompanied with other significant changes. Impact of Rebranding Six courses (including Hawks Creek) accompanied the renovations with other major changes that essentially resulted in a rebranding of the facility. By rebranding we mean there was a major marketing effort made to announce improvements to the facility and to enhance the facility’s image. This may or may not have also involved a repositioning of the facility (into a different price band), or even renaming the course. In the case of two of the six, (Watter’s Creek and Luna Vista), it did involve renaming the course. The six facilities we considered to be rebranded were: Indian Creek Lakes, Luna Vista, Stephens Park, Pecan Hollow, Watters Creek and Hawks Creek. Four of these had major renovations, the other two did not. We compared their performance to the other five facilities. Rounds The Rebranders had a 26.1% increase in rounds in the first year, compared to a LOSS of 3.5% with the others. In the second year, the Rebranders averaged a whopping 39.6% improvement over pre-renovation performance, compared to a decline of 0.5% over base by the others. Revenue The Rebranders averaged a 65.5% increase in revenue (an average of $699,601) in the first year, compared to an 18.1% increase ($171,780) by the others. In the 2nd year, the Rebranders increased on average an additional $241,352, for a total improvement of 74.3% over base in the 2nd year. This compares to a $252,941 increase and 31.7% by the others. However, their numbers are distorted by Indian Creek (which we will discuss more below). When Indian Creek (which was rebranded in the 2nd year) is not considered, the “others” had a decrease in revenue of $69,305, with two of the four showing significant declines and a third essentially showing flat.

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Yield The Rebranders saw an average increase of 19.8% in yield in the first year, before falling to 12.1% over base in the 2nd. The others had a 16.2% increase in the first year and 25.9% over base in the 2nd. Return on Investment The average ROI for the rebranders was 113.4% in the first year and 261.4% the second. This compares to 18.1% in the first year for the others and 27.2% in the 2nd. If we look at just those facilities that had major renovations, we find an ROI of 7.6% in the first year and 7.1% in the 2nd for the Rebranders, compared to 6.4% and 29% for the others. However Indian Creek was rebranded in the 2nd year. If they are considered a rebrander (which they should) in the 2nd year, then the Rebrander’s ROI in year two becomes 22.4%, compared to 5% for the others. Next, we would like to look at two cases a little closer, Hawk’s Creek and Indian Creek, as they make excellent case studies on the impact of management and rebranding. Hawks Creek In 2001, Hawks Creek had a major renovation done, which included rebuilding all the tees, greens and bunkers and some rerouting. However, ten years later, the course was still struggling. In 2011, they brought in new management. The new management did some minor improvements to the course, including a minor rerouting. But mostly they did a lot of clean up, improved course maintenance and golf operations, and significantly improved marketing – essentially what we would consider a rebranding. The results were dramatic. Rounds increased from 23,857 to 33,428, an improvement of 40.1% in the first year. Rounds increased another 4,200 in the 2nd year. Revenue increased 6% in the first year ($90,000). They increased another $125,000 in the 2nd year. Indian Creek Indian Creek is a notable example as it shows us the impact of renovations alone, rebranding alone and both rebranding and renovations. Indian Creek is a 36-hole facility. In 2003, the Creeks course was completely renovated and reopened as essentially a “new” course. However, there were no other changes. Management was the same, as was the fee structure. The Lakes course was unchanged. The result? In 2004, the first full year after the opening, rounds for the combined facility went down 14.7%. Revenue, though did increase by 17.3%, from $1.8m to $2.1m. Yield went up significantly, from $24.75/round to $34.02/round, an increase of 37.5%. This was largely due to the golfers playing the Creek course, which was the more expensive, more after the renovations. The ROI was 9% after the first year.

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Our senior consultant, John Wait, was brought in by the City in 2004 as the city was netting a $750,000 negative cash flow when the debt service was included. He recommended a comprehensive rebranding of the facility, including repositioning the Creek course as an upper mid-fee instead of a value course. He also recommended a change in management and management structure. He also recommended some minor improvements be made to the Lake course – primarily resurfacing the tees and redoing the bunkers. A management company (Eagle) was brought in under a hybrid contract (the City had been operating the course previously). The results were dramatic. In the first year after rebranding, the facility’s rounds jumped from 62,913 to 85,824, a jump of 36.4%. They went up another 7,000 the next year, for a total improvement of 46.4% over 2004. Revenue went up $1.5 m to $3,682,00 in the first year, for a dramatic 72.1% improvement. Revenues continued to climb another 300k the following year, for a total improvement of 86.9% over 2004. The combined yield also increased dramatically, going from $34.02 in 2004 to $42.90 in 2005, an increase of 26.1%. In improved slightly the following year, for a total improvement of 27.2% over base. If you look at the ROI for just the additional $350,000 invested in the Lakes course, the numbers jump through the roof – with a 440% return in year one. However, if we look at the ROI on the combined investment, it was 9% before the rebranding, but in the first year after rebranding and taking the entire investment into consideration, the ROI was 40.1%! It improved to 48.3%. The impact to the city was even more impressive. They went from a negative cash flow from the operations of about $750,000 in 2004 to a positive $250,000 in 2006. This means they had a $1,000,000 improvement to their cash flow, including debt service, in two years. Conclusion There is no doubt that renovations can make a substantial difference in performance. Yet the ones that have the biggest impact and have the best opportunity of paying for themselves, are those that also include a rebranding of the facility.

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Appendix E: Performance Rounds Classic 18

Classic 18 3-year History of Rounds

FY 2014-15 FY 2015-16 FY 2016-17

Qty % Qty % Qty %

Classic 18 Total 29,580 30,462 27,445

Total Weekday 18,893 63.9% 20,106 66.0% 17,561 64.0%

Total Weekend 10,832 36.6% 10,369 34.0% 9,886 36.0%

Discount Card 15,048 50.9% 15,814 51.9% 14,442 52.6%

Non-Resident 9,482 32.1% 9,367 30.7% 8,641 31.5%

Senior 3,797 12.8% 4,090 13.4% 4,150 15.1%

Junior 1,272 4.3% 1,160 3.8% 897 3.3%

Complimentary & 2,997 10.1% 2,716 8.9% 2,123 7.7% Promotional

Specials and discounted 483 1.6% 753 2.5% 684 2.5%

Preferred Player 4,295 14.5% 6,001 19.7% 5,708 20.8%

Twilight 3,005 10.2% 3,107 10.2% 2,492 9.1%

Super Twilight 850 2.9% 903 3.0% 908 3.3%

Early Bird 1,284 4.3% 1,467 4.8% 1,448 5.3%

Midday 1,233 4.2% 1,262 4.1% 1,123 4.1%

League Total 1,580 5.3% 1,205 4.0% 1,038 3.8%

18-hole League 456 1.5% 50 0.2% 23 0.1%

Permanent Teetime 3,597 12.2% 3,320 10.9% 2,867 10.4%

Preseason 1,053 3.6% 706 2.3% 1,174 4.3%

Fall 3,024 10.2% 3,973 13.0% 2,892 10.5%

Total Off season 4,077 13.8% 4,679 15.4% 4,066 14.8%

Rack Rate 7,101 24.0% 8,652 28.4% 6,958 25.4%

9-Hole Play 1,517 5.1% 1,442 4.7% 1,374 5.0%

Non-League 393 1.3% 287 0.9% 359 1.3%

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Classic 18 3-year History of Rounds

FY 2014-15 FY 2015-16 FY 2016-17

Qty % Qty % Qty %

League 1,124 3.8% 1,155 3.8% 1,015 3.7%

East 9

East 9 3-year History of Rounds

FY 2014-15 FY 2015-16 FY 2016-17

Qty % Qty % Qty %

East 9 27,099 28,673 28,304

Total Weekday 19,069 70.4% 20,536 71.6% 20,262 71.6%

Total Weekend 8,030 29.6% 8,137 28.4% 8,042 28.4%

Discount Card 10,845 40.0% 12,223 42.6% 14,027 49.6%

Non-Resident 14,833 54.7% 14,749 51.4% 11,623 41.1%

Senior 4,661 17.2% 5,012 17.5% 5,059 17.9%

Junior 2,355 8.7% 2,155 7.5% 1,917 6.8%

Complimentary & 1,616 6.0% 1,618 5.6% 2,491 8.8% Promotional

Specials and discounted 56 0.2% 346 1.2% 1,643 5.8%

Preferred Player 2,147 7.9% 2,414 8.4% 2,090 7.4%

Twilight 1,288 4.8% 1,597 5.6% 1,205 4.3%

Early Bird 751 2.8% 1,290 4.5% 1,236 4.4%

League 1,583 5.8% 1,595 5.6% 1,432 5.1%

Preseason 1,038 3.8% 733 2.6% 1,126 4.0%

Fall 2,513 9.3% 3,115 10.9% 1,955 6.9%

Total Off season 3,551 13.1% 3,848 13.4% 3,791 13.4%

Family Rate 722 2.7% 719 2.5% 543 1.9%

Rack Rate 7,173 26.5% 6,550 22.8% 5,255 18.6%

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Anetsberger

Anetsberger 3-year Round History

CY 2014 CY 2015 CY 2016

Qty % Qty % Qty %

Total 11,720 11,696 10,802 Weekday 8,456 72.2% 8,786 75.1% 7,538 69.8% Weekend 3,318 28.3% 2,995 25.6% 3,296 30.5% Member 1,698 14.5% 2,071 17.7% 1,900 17.6% Senior 1,712 14.6% 1,914 16.4% 1,854 17.2% Youth 4,127 35.2% 4,604 39.4% 3,684 34.1% Preferred 99 0.8% 108 0.9% 109 1.0% Player Rack Rate 2,751 23.5% 2,477 21.2% 2,584 23.9%

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Revenue Classic 18 Classic 18 3-year History of GF Revenue

FY 2014-15 FY 2015-16 FY 2016-17

Rev % Rev/Rnd Rev % Rev/Rnd Rev % Rev/Rn Classic 18 Total $915,206 $30.94 $949,706 $31.18 $893,566 $32.5

Total Weekday $459,290 50.2% $24.31 $498,725 52.5% $24.80 $449,667 50.3% $25.

Total Weekend $446,453 48.8% $41.22 $443,844 46.7% $42.80 $435,034 48.7% $44.

Discount Card $515,789 56.4% $34.28 $538,104 56.7% $34.03 $504,164 56.4% $34.

Non-Resident $355,397 38.8% $37.48 $361,875 38.1% $38.63 $338,482 37.9% $39.

Senior $114,563 12.5% $30.17 $123,596 13.0% $30.22 $124,900 14.0% $30.

Junior $31,082 3.4% $24.44 $30,183 3.2% $26.02 $24,039 2.7% $26.

Complimentary & $0 0.0% $0.00 $0 0.0% $0.00 $3,557 0.4% $1.68 Promotional

Specials and discounted $5,359 0.6% $11.10 $7,028 0.7% $9.33 $11,825 1.3% $17.

Preferred Player $127,684 14.0% $29.73 $180,241 19.0% $30.04 $175,382 19.6% $30.

Twilight $84,507 9.2% $28.12 $89,850 9.5% $28.92 $72,023 8.1% $28.

Super Twilight $20,534 2.2% $24.16 $20,695 2.2% $22.92 $20,879 2.3% $22.

Early Bird $35,856 3.9% $27.93 $40,661 4.3% $27.72 $40,737 4.6% $28.

Weekend Midday $49,631 5.4% $40.25 $52,648 5.5% $41.72 $47,669 5.3% $42.

League Total $39,337 4.3% $24.90 $26,083 2.7% $21.65 $21,166 2.4% $20.

18-hole League $15,513 1.7% $34.02 $1,700 0.2% $34.00 $792 0.1% $34.

Permanent Teetime $153,500 16.8% $42.67 $145,347 15.3% $43.78 $130,992 14.7% $45.

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Classic 18 3-year History of GF Revenue

FY 2014-15 FY 2015-16 FY 2016-17

Rev % Rev/Rnd Rev % Rev/Rnd Rev % Rev/Rn

Preseason $30,845 3.4% $29.29 $21,826 2.3% $30.92 $38,720 4.3% $32.

Fall $87,200 9.5% $28.84 $119,874 12.6% $30.17 $80,946 9.1% $27.

Total Off season $118,045 12.9% $28.95 $141,700 14.9% $30.28 $119,666 13.4% $29.

Rack Rate $156,994 17.2% $45.05 $168,307 17.7% $44.87 $156,604 17.5% $47.

9-Hole Play $33,287 3.6% $21.94 $31,520 3.3% $21.86 $29,239 3.3% $21.

Non-League $9,463 1.0% $24.08 $7,137 0.8% $24.87 $8,865 1.0% $24.

League $23,824 2.6% $21.20 $24,383 2.6% $21.11 $20,374 2.3% $20.

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East 9 East 9 3-year History of Rounds FY 2014-15 FY 2015-16 FY 2016-17

Rev Rev/rnd Rev Rev/rnd Rev Rev/r East 9 Total $497,939 $18.37 $533,972 $18.62 $520,519 $1

Total Weekday $313,252 $16.43 $331,297 $16.13 $320,127 $

Total Weekend $184,687 $23.00 $186,375 $22.90 $187,092 $

Discount Card $202,197 $18.64 $227,981 $18.65 $267,501 $

Non-Resident $304,218 $20.51 $296,783 $20.12 $237,069 $

Senior $83,971 $18.02 $90,289 $18.01 $90,845 $

Junior $43,215 $18.35 $41,471 $19.24 $36,832 $

Specials and $1,293 $23.09 $2,175 $6.29 $22,096 $ discounted

Preferred Player $36,371 $16.94 $41,472 $17.18 $37,200 $

Twilight $20,028 $15.55 $23,289 $14.58 $18,618 $

Early Bird $3,894 $5.19 $16,150 $12.52 $15,801 $

League $32,457 $20.50 $33,072 $20.73 $27,734 $

Preseason $14,858 $14.31 $12,095 $16.50 $20,445 $

Fall $41,755 $16.62 $51,081 $16.40 $31,917 $

Total Off season $56,613 $15.94 $63,176 $16.42 $64,432 $

Family Rate $12,046 $16.68 $11,573 $16.10 $9,415 $

Rack Rate $172,853 $24.10 $160,251 $24.47 $139,596 $

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Sportsman’s Total Revenue Sportsman's CC Revenue by Year FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Aver Rounds 57,160 56,679 59,135 55,748 Revenue

DAILY FEES

Greens Fees $1,394,963 $1,402,435 $1,460,367 $1,394,836 $1,

Preferred Player Plan ($87,154) ($80,506) ($99,023) ($92,858) ($

DAILY FEES $1,307,810 $1,321,929 $1,361,345 $1,301,978 $1,3

PROGRAM FEES

Tournament Fees $18,625 $19,666 $23,318 $29,230

League Fees $43,249 $44,175 $39,575 $39,635

PROGRAM FEES $61,874 $63,841 $62,893 $68,865 $

MEMBERSHIPS

Program Fees $6,888 $9,941 $10,819 $5,315

Discount cards $13,827 $19,275 $19,700 $18,300

MEMBERSHIPS $20,715 $29,216 $30,519 $23,615 $

RENTALS

Golf Carts $350,486 $318,003 $335,681 $317,454 $

Push Carts $17,188 $19,462 $18,178 $17,300

Clubs $3,755 $2,899 $4,458 $4,240

Facility Rental $0 $900 $0 $0

RENTALS $371,429 $341,264 $358,317 $338,994 $3

PROSHOP SALES

Merchandise $215,633 $234,792 $241,785 $230,597 $

Food & Beverage Sales $129 $213 $241 $208

SALES $215,762 $235,005 $242,025 $230,805 $2

MISCELLANEOUS

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Sportsman's CC Revenue by Year FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Aver Miscellaneous Revenue $11,470 $13,273 $2,513 $1,212

Over/Short Income ($123) ($132) $366 $578

Vending Commission $0 ($1) $0 $0

MISCELLANEOUS $11,346 $13,140 $2,879 $1,790

Total Revenue $1,988,936 $2,004,396 $2,057,978 $1,966,047 $2,004,3

Sportsman’s Revenue Per Round Sportsman's CC Revenue per round FY FY FY FY 2013- 2014- 2015- 2016- Averag 14 15 16 17 e Revenue

DAILY FEES

Greens Fees $24.40 $24.74 $24.70 $25.02 $24.72

Preferred Player Plan ($1.52) ($1.42) ($1.67) ($1.67) ($1.57)

DAILY FEES $22.88 $23.32 $23.02 $23.35 $23.14

PROGRAM FEES

Tournament Fees $0.33 $0.35 $0.39 $0.52 $0.40

League Fees $0.76 $0.78 $0.67 $0.71 $0.73

PROGRAM FEES $1.08 $1.13 $1.06 $1.24 $1.13

MEMBERSHIPS

Program Fees $0.12 $0.18 $0.18 $0.10 $0.14

Discount cards $0.24 $0.34 $0.33 $0.33 $0.31

MEMBERSHIPS $0.36 $0.52 $0.52 $0.42 $0.45

RENTALS

Golf Carts $6.13 $5.61 $5.68 $5.69 $5.78

Push Carts $0.30 $0.34 $0.31 $0.31 $0.32

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Sportsman's CC Revenue per round FY FY FY FY 2013- 2014- 2015- 2016- Averag 14 15 16 17 e Clubs $0.07 $0.05 $0.08 $0.08 $0.07

Facility Rental $0.00 $0.02 $0.00 $0.00 $0.00

RENTALS $6.50 $6.02 $6.06 $6.08 $6.16

PROSHOP SALES

Merchandise $3.77 $4.14 $4.09 $4.14 $4.04

Food & Beverage Sales $0.00 $0.00 $0.00 $0.00 $0.00

SALES $3.77 $4.15 $4.09 $4.14 $4.04

MISCELLANEOUS

Miscellaneous Revenue $0.20 $0.23 $0.04 $0.02 $0.12

Over/Short Income ($0.00) ($0.00) $0.01 $0.01 $0.00

Vending Commission $0.00 ($0.00) $0.00 $0.00 ($0.00)

MISCELLANEOU S $0.20 $0.23 $0.05 $0.03 $0.13

Total Revenue $34.80 $35.36 $34.80 $35.27 $35.06

Driving Range Range Revenue FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average DAILY FEES

Range buckets $238,809 $250,430 $248,658 $219,404 $239,325

Miniature Golf $22,510 $24,713 $23,800 $23,496 $23,630

DAILY FEES $261,319 $275,143 $272,458 $242,900 $262,955

RENTALS

Equipment Rental $0 $117 $962 $524 $401

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RENTALS $0 $117 $962 $524 $401

SALES

Miscellaneous Sales $1,419 $5,136 $3,825 $3,750 $3,532

SALES $1,419 $5,136 $3,825 $3,750 $3,532

MISCELLANEOUS

Miscellaneous Revenue $5,283 $4,703 $4,220 $3,850 $4,514

Over/Short Income ($132) ($72) ($44) $114 ($33)

MISCELLANEOUS $5,151 $4,631 $4,176 $3,964 $4,481

Total Revenue $267,889 $285,026 $281,421 $251,139 $271,369

Anetsberger Total Revenue Anetsberger Revenue FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Rounds 12,259 11,969 11,671 10,916 11,704 Revenue

DAILY FEES

Greens Fees $83,795 $79,237 $73,128 $73,967 $77,532

PROGRAM FEES

Tournament Fees $1,936 $1,860 $1,615 $1,397 $1,702

League Fees $210 $0 $0 $0 $53

PROGRAM FEES $2,146 $1,860 $1,615 $1,397 $1,755

MEMBERSHIPS

MEMBERSHIPS $21,076 $23,952 $23,670 $26,491 $23,797

RENTALS

Equipment Rental $3,678 $3,516 $4,580 $4,534 $4,077

SALES

Golf Shop Sales $17,391 $16,985 $19,256 $19,496 $18,282

MISCELLANEOUS

Miscellaneous Revenue $0 $4,226 $0 $0 $1,057

Sirius Golf Advisors, LLC 365

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Anetsberger Revenue FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Over/Short Income ($18) ($72) $5 $52 ($8)

MISCELLANEOUS ($18) $4,154 $5 $52 $1,048

Total Revenue $128,068 $129,704 $122,254 $125,937 $126,491

Anetsberger Revenue/Round Anetsberger Revenue per Round FY FY FY FY Averag 2013-14 2014-15 2015-16 2016-17 e DAILY FEES

Greens Fees $6.84 $6.62 $6.27 $6.78 $6.62

DAILY FEES $6.84 $6.62 $6.27 $6.78 $6.62

PROGRAM FEES

Tournament Fees $0.16 $0.16 $0.14 $0.13 $0.15

League Fees $0.02 $0.00 $0.00 $0.00 $0.00

PROGRAM FEES $0.18 $0.16 $0.14 $0.13 $0.15

MEMBERSHIPS

Membership Fees $1.72 $2.00 $2.03 $2.43 $2.03

MEMBERSHIPS $1.72 $2.00 $2.03 $2.43 $2.03

RENTALS

Equipment Rental $0.30 $0.29 $0.39 $0.42 $0.35

RENTALS $0.30 $0.29 $0.39 $0.42 $0.35

SALES

Golf Shop Sales $1.42 $1.42 $1.65 $1.79 $1.56

SALES $1.42 $1.42 $1.65 $1.79 $1.56

MISCELLANEOUS

Sirius Golf Advisors, LLC 366

Golf Operations Assessment Appendices

Anetsberger Revenue per Round FY FY FY FY Averag 2013-14 2014-15 2015-16 2016-17 e Miscellaneous Revenue $0.00 $0.35 $0.00 $0.00 $0.09

Over/Short Income ($0.00) ($0.01) $0.00 $0.00 ($0.00)

MISCELLANEOUS ($0.00) $0.35 $0.00 $0.00 $0.09

Total Revenue $10.45 $10.84 $10.48 $11.54 $10.81

Sirius Golf Advisors, LLC 367

Golf Operations Assessment Appendices

Expenses Sportsman’s Sportsman's Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Golf Operations

SALARY & WAGES

FT Manager $63,889 $65,806 $70,543 $71,483 $67,930

FT Supervisor $40,119 $42,282 $45,545 $45,452 $43,350

PT Personnel $215,819 $199,036 $204,662 $193,362 $203,220

PT Overtime $25 $0 $118 $944 $271

SALARY & WAGES $319,851 $307,124 $320,868 $311,241 $314,771

EMPLOYEE BENEFITS

Health Insurance Premiums $18,742 $32,853 $36,139 $39,853 $31,897

EMPLOYEE BENEFITS $18,742 $32,853 $36,139 $39,853 $31,897

CONTRACTUAL SERVICES

Training & Education $208 $0 $149 $0 $89

Dues & Publications $6,763 $6,163 $4,475 $4,946 $5,587

Professional Services $810 $270 $0 $0 $270

Program Operating Services $13,617 $13,909 $13,435 $17,180 $14,535

GPS $55,332 $55,332 $51,221 $43,106 $51,248

Public Relations $927 $1,051 $2,038 $919 $1,234

Postage $162 $785 $1,063 $664 $669

Voice/Data $1,123 $0 $0 $0 $281

CONTRACTUAL SERVICES $78,943 $77,510 $72,380 $66,815 $73,912

SUPPLIES

Office Supplies $944 $1,201 $1,419 $603 $1,042

Program Operating Supplies $25,567 $23,368 $26,828 $31,541 $26,826

Uniforms $4,391 $3,690 $4,046 $5,592 $4,430

Furn & Fix < 10K $5,971 $3,713 $478 $693 $2,714

Equipment < 10K $27 $665 $2,463 $0 $789

SUPPLIES $36,901 $32,636 $35,234 $38,428 $35,800

Sirius Golf Advisors, LLC 368

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Sportsman's Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Total Golf Operations $454,437 $450,123 $464,622 $456,337 $456,380

Course Maintenance

MISCELLANEOUS

Miscellaneous Revenue ($1,535) $0 $0 ($594) ($532

Surplus Equipment ($1,150) $0 $0 $0 ($288

MISCELLANEOUS ($2,685) $0 $0 ($594) ($820

SALARY & WAGES

FT Manager $76,849 $79,154 $85,076 $85,202 $81,570

FT Supervisor $41,847 $43,808 $45,232 $46,964 $44,463

FT Maintenance $30,879 $35,992 $21,259 $31,677 $29,952

PT Maintenance $240,496 $216,058 $249,031 $260,024 $241,402

FT Overtime $4,700 $6,194 $1,648 $3,097 $3,910

PT Overtime $34,853 $28,582 $31,209 $26,613 $30,314

SALARY & WAGES $429,624 $409,789 $433,455 $453,578 $431,611

EMPLOYEE BENEFITS

Health Insurance Premiums $47,793 $45,446 $44,480 $42,929 $45,162

EMPLOYEE BENEFITS $47,793 $45,446 $44,480 $42,929 $45,162

CONTRACTUAL SERVICES

Conferences & Seminars Staff $1,138 $0 $0 $0 $285

Training & Education $3,284 $428 $1,759 $1,363 $1,708

Dues & Publications $1,844 $1,704 $1,555 $1,391 $1,623

Uniform Cleaning Service $6,812 $4,450 $1,732 $1,440 $3,608

Professional Services $5,520 $7,756 $4,530 $3,647 $5,363

Grounds Maintenance Services $4,681 $17,195 $12,524 $16,040 $12,610

Transportation/Mileage Reimb $4 $0 $0 $0 $1

Misc Contractual Services $8,580 $7,030 $4,700 $5,135 $6,361

Sirius Golf Advisors, LLC 369

Golf Operations Assessment Appendices

Sportsman's Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Postage $207 $0 $977 $23 $302

CONTRACTUAL SERVICES $32,070 $38,563 $27,775 $29,039 $31,862

REPAIR & MAINTENANCE

Ground Repairs $10,420 $10,364 $16,768 $5,614 $10,791

REPAIR & MAINTENANCE $10,420 $10,364 $16,768 $5,614 $10,791

SUPPLIES

Office Supplies $508 $649 $194 $202 $388

Program Operating Supplies $13,215 $18,807 $14,945 $15,806 $15,693

Safety/First Aid $3,075 $3,470 $2,082 $2,893 $2,880

Uniforms $1,666 $4,291 $3,991 $3,107 $3,264

Tools/Hardware $1,469 $4,576 $785 $320 $1,787

Building Supplies ($16) $0 $379 $39 $101

Electrical Supplies $0 $341 ($18) $0 $81

Plumbing/Irrigation $11,750 $12,871 $14,175 $12,760 $12,889

Equipment Supplies $0 $0 $102 $0 $25

Grounds Supplies $142,376 $159,311 $166,284 $159,501 $156,868

Planting Supplies $24,088 $30,034 $26,997 $32,212 $28,333

SUPPLIES $198,129 $234,349 $229,916 $226,839 $222,308

Sportsman's Grounds $715,351 $738,511 $752,394 $757,405 $740,915

Fleet Management

MISCELLANEOUS

Miscellaneous Revenue ($36) ($751) $0 ($50) ($209

Surplus Equipment $0 $0 $0 ($282) ($71

MISCELLANEOUS ($36) ($751) $0 ($332) ($280

SALARY & WAGES

FT Maintenance $43,096 $44,831 $34,907 $49,239 $43,018

FT Overtime $1,508 $1,868 $1,265 $1,931 $1,643

SALARY & WAGES $44,604 $46,699 $36,172 $51,170 $44,661

EMPLOYEE BENEFITS

Sirius Golf Advisors, LLC 370

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Sportsman's Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Health Insurance Premiums $24,561 $20,716 $14,400 $21,600 $20,319

EMPLOYEE BENEFITS $24,561 $20,716 $14,400 $21,600 $20,319

CONTRACTUAL SERVICES

Training & Education $0 $0 $0 $75 $19

Dues & Publications $130 $130 $0 $130 $98

Professional Services $4,961 $0 $125 $0 $1,271

Inspection Services $24 $23 $0 $348 $99

Equipment Rental $5,027 $4,173 $5,530 $1,922 $4,163

CONTRACTUAL SERVICES $10,142 $4,326 $5,655 $2,475 $5,649

REPAIR & MAINTENANCE

Equipment Repairs $1,831 $2,595 $292 $911 $1,407

REPAIR & MAINTENANCE $1,831 $2,595 $292 $911 $1,407

SUPPLIES

Program Operating Supplies $0 ($99) $0 $0 ($25

Safety/First Aid $0 $0 $121 $283 $101

Tools/Hardware $810 $979 $886 $2,174 $1,212

Building Supplies $107 $0 $0 $0 $27

Equipment Supplies $50,779 $46,243 $48,677 $46,944 $48,161

Vehicle Supplies $21 $418 $360 $0 $200

Fuel Supplies $58,277 $50,997 $39,868 $31,364 $45,126

Miscellaneous Supplies $0 $537 $898 $589 $506

Equipment < 10K $2,814 $3,104 $1,569 $3,370 $2,714

SUPPLIES $112,808 $102,180 $92,378 $84,724 $98,023

Sportsman's Fleet $193,910 $175,765 $148,898 $160,548 $169,780

General & Administrative

CONTRACTUAL SERVICES

Misc Contractual Services $0 $303 $0 $0 $76

Sirius Golf Advisors, LLC 371

Golf Operations Assessment Appendices

Sportsman's Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Average

Building Maintenance Services $0 $234 $0 $0 $59

Equipment Maintenance Services $2,001 $2,386 $2,276 $1,614 $2,069

Public Relations $59 $528 $0 $408 $249

Voice/Data $5,349 $5,580 $5,580 $5,833 $5,586

CONTRACTUAL SERVICES $7,409 $9,031 $7,856 $7,855 $8,038

SUPPLIES

Office Supplies $1,118 ($169) $0 $0 $237

Equipment < 10K $309 $676 $130 $1,166 $570

SUPPLIES $1,426 $507 $130 $1,166 $807

Total G&A $8,836 $9,538 $7,986 $9,021 $8,845

Total Expenses $1,372,534 $1,373,937 $1,373,899 $1,383,311 $1,375,920

Driving Range Driving Range Expenses FY 2013- FY 2014- FY 2015- FY 14 15 16 2016-17 Average

SALARY & WAGES

FT Supervisor $51,635 $51,898 $55,511 $923 $39,992

PT Personnel $30,013 $31,474 $25,858 $23,781 $27,781

PT Overtime $3 $0 $0 $22 $6

SALARY & WAGES $81,651 $83,372 $81,369 $24,727 $67,780

EMPLOYEE BENEFITS

Health Insurance Premiums $23,293 $25,685 $28,369 $0 $19,337

EMPLOYEE BENEFITS $23,293 $25,685 $28,369 $0 $19,337

CONTRACTUAL SERVICES

Dues & Publications $1,075 $790 $675 $0 $635

Sirius Golf Advisors, LLC 372

Golf Operations Assessment Appendices

Driving Range Expenses FY 2013- FY 2014- FY 2015- FY 14 15 16 2016-17 Average

Postage $458 $136 $13 $0 $152

CONTRACTUAL SERVICES $1,533 $926 $688 $0 $787

REPAIR & MAINTENANCE

Miscellaneous Repairs $0 $2,000 $0 $35 $509

REPAIR & MAINTENANCE $0 $2,000 $0 $35 $509

SUPPLIES

Office Supplies $0 $0 $75 $0 $19

Program Operating Supplies $33,290 $27,278 $24,659 $30,603 $28,957

SUPPLIES $33,290 $27,278 $24,734 $30,603 $28,976

Total Expenses $139,767 $139,261 $135,160 $55,365 $117,388

Academy Expenses Academy Expenses FY FY FY FY 2016- 2013-14 2014-15 2015-16 17 Average

SALARY & WAGES

FT Supervisor $0 $0 $0 $23,077 $5,769

SALARY & WAGES $0 $0 $0 $23,077 $5,769

EMPLOYEE BENEFITS

Health Insurance Premiums $0 $0 $0 $29,788 $7,447

EMPLOYEE BENEFITS $0 $0 $0 $29,788 $7,447

CONTRACTUAL SERVICES

Training & Education $816 $0 $23 $175 $254

Dues & Publications $690 $1,165 $690 $1,365 $978

Independent Contractor Service $0 $0 $7,103 $52,697 $14,950

CONTRACTUAL SERVICES $1,506 $1,165 $7,816 $54,237 $16,181

Sirius Golf Advisors, LLC 373

Golf Operations Assessment Appendices

Academy Expenses FY FY FY FY 2016- 2013-14 2014-15 2015-16 17 Average

SUPPLIES

Program Operating Supplies $16,407 $22,509 $20,538 $19,032 $19,621

SUPPLIES $16,407 $22,509 $20,538 $19,032 $19,621

Total Expenses $17,913 $23,674 $28,354 $126,134 $49,019

Anetsberger Expenses Anetsberger Expenses FY 2013- FY 2014- FY 2015- FY 14 15 16 2016-17 Average

Golf Operations

SALARY & WAGES

PT Personnel $34,860 $48,359 $46,701 $32,935 $40,714

PT Overtime $3 $0 $0 $0 $1

SALARY & WAGES $34,863 $48,359 $46,701 $32,935 $40,714

CONTRACTUAL SERVICES

Dues & Publications $0 $330 $565 $0 $224

Inspection Services $125 $0 $225 $0 $88

Building Maintenance Services $279 $287 $287 $180 $258

Transportation/Mileage Reimb $0 $0 $0 $124 $31

Public Relations $0 $0 $0 $0 $0

Electricity $3,019 $2,512 $2,649 $1,992 $2,543

CONTRACTUAL SERVICES $3,423 $3,128 $3,726 $2,295 $3,143

REPAIR & MAINTENANCE

Building Repairs $543 $4,593 $0 $0 $1,284

REPAIR & MAINTENANCE $543 $4,593 $0 $0 $1,284

Sirius Golf Advisors, LLC 374

Golf Operations Assessment Appendices

Anetsberger Expenses FY 2013- FY 2014- FY 2015- FY 14 15 16 2016-17 Average SUPPLIES

Office Supplies $12 $0 $0 $0 $3

Program Operating Supplies $3,755 $2,548 $2,322 $1,263 $2,472

Uniforms $337 $564 $366 $342 $402

Building Supplies $0 $0 $586 $0 $146

Equipment Supplies $0 $90 $0 $0 $23

Cost of Goods Sold $10,175 $12,808 $11,172 $11,139 $11,324

Furn & Fix < 10K $0 $641 $0 $103 $186

Equipment < 10K $0 $0 $720 $0 $180

SUPPLIES $14,280 $16,651 $15,166 $12,848 $14,736

Total Operations $53,109 $72,731 $65,593 $48,078 $59,878

Course Maintenance

SALARY & WAGES

PT Maintenance $21,012 $19,926 $20,358 $21,305 $20,651

PT Overtime $3,763 $4,042 $3,440 $2,971 $3,554

SALARY & WAGES $24,776 $23,968 $23,798 $24,277 $24,205

CONTRACTUAL SERVICES

Grounds Maintenance Services $0 $1,345 $0 $0 $336

Misc Contractual Services $3,240 $3,055 $2,100 $2,540 $2,734

Water $20 $50 $18 $60 $37

CONTRACTUAL SERVICES $3,260 $4,450 $2,118 $2,600 $3,107

REPAIR & MAINTENANCE

Building Repairs $4,281 $475 $159 $179 $1,274

Ground Repairs $0 $1,600 $0 $3,600 $1,300

Sirius Golf Advisors, LLC 375

Golf Operations Assessment Appendices

Anetsberger Expenses FY 2013- FY 2014- FY 2015- FY 14 15 16 2016-17 Average REPAIR & MAINTENANCE $4,281 $2,075 $159 $3,779 $2,574

SUPPLIES

Building Supplies $0 $0 $1,780 $0 $445

Plumbing/Irrigation $0 $0 $94 $0 $23

Grounds Supplies $29,137 $32,526 $24,672 $19,012 $26,337

SUPPLIES $29,137 $32,526 $26,546 $19,012 $26,805

Total Course Maintenance $61,454 $63,019 $52,621 $49,668 $56,690

Total Expenses $114,562 $135,750 $118,214 $97,746 $116,568

Sirius Golf Advisors, LLC 376

Golf Operations Assessment Appendices

Division Expenses Division Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Avera

Facility Management

SALARY & WAGES

FT Maintenance $41,254 $44,025 $45,088 $45,970 $44,0

FT Overtime $3,697 $3,627 $1,803 $669 $2,4

SALARY & WAGES $44,951 $47,653 $46,891 $46,639 $46,5

EMPLOYEE BENEFITS

Health Insurance Premiums $22,728 $20,716 $21,600 $21,600 $21,6

EMPLOYEE BENEFITS $22,728 $20,716 $21,600 $21,600 $21,6

CONTRACTUAL SERVICES

Dues & Publications $30 $15 $15 $15 $19

Professional Services $0 $70 $0 $0 $18

Inspection Services $3,291 $2,663 $2,964 $3,280 $3,0

Building Maintenance Services $35,650 $43,023 $29,775 $28,006 $34,1

Water $3,475 $3,582 $3,493 $4,929 $3,8

Electricity $70,472 $65,645 $70,559 $65,572 $68,0

Natural Gas $19,803 $15,716 $9,532 $12,128 $14,2

Equipment Rental $0 $0 $0 $0

CONTRACTUAL SERVICES $132,722 $130,714 $116,337 $113,929 $123,4

REPAIR & MAINTENANCE

Building Repairs $17,717 $8,522 $9,926 $5,177 $10,3

Equipment Repairs $3,602 $5,980 $3,321 $3,251 $4,0

REPAIR & MAINTENANCE $21,318 $14,503 $13,247 $8,428 $14,3

SUPPLIES

Office Supplies $28 $0 $0 $0

Safety/First Aid $847 $1,207 $155 $862 $768

Sirius Golf Advisors, LLC 377

Golf Operations Assessment Appendices

Division Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Avera

ools/Hardware $1,313 $1,419 $1,710 $1,157 $1,4

Building Supplies $8,318 $8,200 $7,493 $9,145 $8,2

Electrical Supplies $3,653 $4,882 $5,192 $4,198 $4,4

Plumbing/Irrigation $2,273 $2,638 $1,026 $1,787 $1,9

Janitorial Supplies $6,103 $5,051 $4,988 $5,340 $5,3

HVAC $279 $323 $1,802 $581 $746

Equipment Supplies $0 $43 $0 $0 $11

Miscellaneous Supplies $403 $332 $478 $521 $434

Furn & Fix < 10K $0 $6,410 $0 $429 $1,7

SUPPLIES $23,217 $30,504 $22,843 $24,020 $25,1

Subtotal Building/Facility $244,936 $244,089 $220,918 $214,617 $231,1

General & Administrative

SALARY & WAGES

Director $95,888 $98,525 $106,411 $106,331 $101,7

SALARY & WAGES $95,888 $98,525 $106,411 $106,331 $101,7

EMPLOYEE BENEFITS

Health Insurance Premiums $23,345 $25,747 $27,559 $27,271 $25,9

EMPLOYEE BENEFITS $23,345 $25,747 $27,559 $27,271 $25,9

CONTRACTUAL SERVICES

Training & Education $24 $0 $0 $0

Dues & Publications $110 $101 $55 $0 $66

Bank Fees/Charges $55,051 $56,176 $56,939 $54,113 $55,5

Advertising $13,977 $500 $7,857 $2,300 $6,1

Printing $7,749 $3,138 $1,994 $2,431 $3,8

Postage $27 $0 $0 $0

Conferences & Seminars Staff $58 $0 $0 $0 $15

Sirius Golf Advisors, LLC 378

Golf Operations Assessment Appendices

Division Expenses FY 2013- FY 2014- FY 2015- FY 2016- 14 15 16 17 Avera

Unemployment Reimbursement $92,639 $85,261 $77,420 $79,325 $83,6

CONTRACTUAL SERVICES $169,635 $145,176 $144,265 $138,169 $149,3

ADMINISTRATIVE CHARGES

FICA $78,854 $78,562 $80,272 $76,563 $78,5

Medicare $18,442 $18,373 $18,773 $17,906 $18,3

IMRF $120,342 $108,419 $107,930 $97,244 $108,4

Life Insurance $30 $609 $1,003 $1,150 $698

PDRMA portion (16%) $47,610 $58,678 $48,404 $48,067 $50,6

Golf Conferences $7,000 $7,000 $7,000 $8,119 $7,2

Software $3,572 $6,957 $5,189 $3,770 $4,8

Administration Overhead Charge $24,151 $21,402 $31,428 $47,182 $31,0

DEPARTMENT TRANFERS $300,000 $300,000 $300,000 $300,000 $300,0

Total G&A $588,867 $569,447 $578,234 $571,772 $577,0

Total Expenses $833,803 $813,536 $799,152 $786,389 $808,2

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Appendix F: Customer Feedback Satisfaction Factors Satisfaction Factors Classic 18 East 9 Anets Total # Responses 313 108 35 Overall Value Average Score 7.2 7.5 8.3 Premium Percentile 28 45 54 National Percentile 18 34 78 Overall Course Conditions Average Score 7.8 8.1 7.5 Premium Percentile 12 31 44 National Percentile 34 55 24 Pace of Play Average Score 7.0 7.2 7.2 Premium Percentile 16 25 37 National Percentile 32 43 43 Friendliness/Helpfulness of Staff Average Score 8.3 8.5 8.9 Premium Percentile 22 32 77 National Percentile 31 46 82 Golf Course Design/Layout Average Score 7.8 7.9 7.9 Premium Percentile 5 7 40 National Percentile 13 20 19 Convenience of Course Location Average Score 9.1 8.9 8.9 Premium Percentile 95 88 64 National Percentile 92 84 85 Tee Time Availability Average Score 7.9 8.3 8.5 Premium Percentile 40 70 60 National Percentile 40 67 84 Condition of Greens Average Score 7.2 7.9 6.9 Premium Percentile 7 25 22 National Percentile 17 48 10 Scenery and Aesthetics of Course

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Satisfaction Factors Classic 18 East 9 Anets Average Score 7.7 8.0 8.3 Premium Percentile 6 12 70 National Percentile 18 32 45 Condition of Golf Carts Average Score 6.9 7.3 6.6 Premium Percentile 1 12 3 National Percentile 3 32 2 Amenities (Clubhouse, proshop, locker room) Average Score 6.5 7.3 6.8 Premium Percentile 9 2 30 National Percentile 12 8 19 Food and Beverage Service Average Score 5.7 5.9 4.4 Premium Percentile 1 1 0 National Percentile 2 2 0 On course services (restrooms, water) Average Score 7.2 7.3 6.1 Premium Percentile 18 23 11 National Percentile 37 44 5 Overall Experience Average Score 7.7 8.0 8.3 Premium Percentile 8 18 62 National Percentile 19 34 56 Affordability Average Score 7.1 7.3 8.7 Premium Percentile 77 82 71 National Percentile 41 46 94 Condition of Tees Average Score 7.4 7.8 7.0 Premium Percentile 5 11 23 National Percentile 25 43 11 Condition of Bunkers Average Score 6.7 6.9 7.4 Premium Percentile 7 8 81 National Percentile 31 35 55 Condition of Fairways Average Score 8.0 8.1 7.6 Premium Percentile 14 23 42 National Percentile 42 52 23

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Satisfaction Factors Classic 18 East 9 Anets Overall Quality of Practice Facility Average Score 6.6 7.6 7.8 Premium Percentile 9 22 78 National Percentile 16 46 55 Overall Quality of Proshop Average Score 7.5 7.8 7.2 Premium Percentile 17 26 24 National Percentile 34 46 21 Overall Quality of Apparel Average Score 7.3 7.5 6.2 Premium Percentile 14 25 2 National Percentile 33 44 2 Overall Quality of Merchandise Average Score 7.5 7.4 6.2 Premium Percentile 26 22 3 National Percentile 44 40 3

Customer Profile By Age Age Classic 18 East 9 Anets Course Rounds Total Total Responses 313 108 35 Satisfaction 7.9 8.3 8.0 Avg. Annual Spend $1,072 $461 $253 Avg. Wallet Share 52.8% 63.0% 59.4%

1-7 Responses 112 39 15 % of response 35.8% 36.1% 42.9% Satisfaction 7.6 7.9 8.2 Avg. Annual Spend $321 $188 $85 Avg. Wallet Share 25.6% 38.2% 49.7% 8-24 Responses 128 57 16 % of response 40.9% 52.8% 45.7%

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Age Classic 18 East 9 Anets Course Rounds Total Satisfaction 7.9 8.4 8.2 Avg. Annual Spend $967 $502 $326 Avg. Wallet Share 63.6% 74.3% 62.2% 25-49 Responses 61 10 3 % of response 19.5% 9.3% 8.6% Satisfaction 8.2 9.3 6.0 Avg. Annual Spend $2,057 $1,081 $725 Avg. Wallet Share 74.7% 91.5% 78.7% 50+ Responses 12 2 1 % of response 3.8% 1.9% 2.9% Satisfaction 9.1 6.0 7.0 Avg. Annual Spend $4,096 $1,550 $210 Avg. Wallet Share 79.4% 82.0% 100.0%

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By Customer Segment Customer Type Classic 18 East 9 Anets Course Rounds Total Local Player/Area Res Responses 100 46 20 % of response 31.9% 42.6% 57.1% Satisfaction 7.8 7.9 7.9 Avg. Annual Spend $788 $377 $268 Avg. Wallet Share 45.2% 57.9% 69.9% Non-Resident Responses 50 23 4 % of response 16.0% 21.3% 11.4% Satisfaction 7.6 8.4 9.5 Avg. Annual Spend $595 $380 $54 Avg. Wallet Share 31.5% 39.3% 44.4% Discount Card holder Responses 44 14 3 % of response 14.1% 13.0% 8.6% Satisfaction 7.8 8.4 7.3 Avg. Annual Spend $990 $560 $112 Avg. Wallet Share 54.2% 79.5% 39.2% Preferred Player Prog Responses 33 12 5 % of response 10.5% 11.1% 14.3% Satisfaction 8.4 8.8 7.2 Avg. Annual Spend $1,669 $772 $498 Avg. Wallet Share 73.1% 86.6% 65.1% Member other club Responses 8 12 2 % of response 2.6% 11.1% 5.7% Satisfaction 8.4 8.8 7.5 Avg. Annual Spend $335 $772 $211 Avg. Wallet Share 13.9% 86.6% 23.3% League Player Responses 32 12 1 % of response 10.2% 11.1% 2.9% Satisfaction 7.9 8.7 10.0 Avg. Annual Spend $1,079 $524 $36 Avg. Wallet Share 66.0% 84.2% 13.0%

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Customer Type Classic 18 East 9 Anets Course Rounds Total Perm. Teetime Responses 46 1 % of response 14.7% 0.9% 0.0% Satisfaction 8.0 10.0 Avg. Annual Spend $1,981 $370 Avg. Wallet Share 73.8% 71.4%

Factors that keep you from playing more rounds at the course Main Factors that keep you from playing more rounds at course Classic 18 East 9 Anets

# Responses 698 204 61 Not Enough Time # 137 59 17 % 43.8% 54.6% 48.6% Location # 15 12 1 % 4.8% 11.1% 2.9% Overall quality of course # 31 4 2 % 9.9% 3.7% 5.7% Course conditions # 25 6 % 8.0% 5.6% 0.0% Greens too slow # 18 1 4 % 5.8% 0.9% 11.4% Greens too fast # 0 0 0 % 0.0% 0.0% 0.0% Course too difficult # 0 0 1 % 0.0% 0.0% 2.9%

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Main Factors that keep you from playing more rounds at course Classic 18 East 9 Anets Course too long # 0 2 0 % 0.0% 1.9% 0.0% Course too expensive # 52 21 2 % 16.6% 19.4% 5.7% Value # 54 8 0 % 17.3% 7.4% 0.0% No bar # 25 5 1 % 8.0% 4.6% 2.9% Food quality # 25 6 1 % 8.0% 5.6% 2.9% Food service # 30 6 3 % 9.6% 5.6% 8.6% Customer service # 13 1 1 % 4.2% 0.9% 2.9% Not able to take cart into parking lot # 36 8 % 11.5% 7.4% 0.0% Like to play a variety of courses # 115 27 5 % 36.7% 25.0% 14.3% Cart quality # 24 2 % 7.7% 1.9% 0.0% Lack of good teetimes # 15 6 % 4.8% 5.6% 0.0% Pace too slow # 53 13 4 % 16.9% 12.0% 11.4% Prefer to play regulation courses # 9

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Main Factors that keep you from playing more rounds at course Classic 18 East 9 Anets % 25.7% No golf carts # 2 % 5.7% Prefer playing the East 9 (or Classic 18) # 5 8 % 1.6% 7.4% 0.0% Other # 25 9 8 % 8.0% 8.3% 22.9%

Family Tees

Family Tees Do you like the family tees

# Responses 107 Yes # 20 % 18.7% No # 7 % 6.5% Not Applicable # 80 % 74.8% Are you aware of the family rate?

107 Yes # 13 % 12.1% No # 33 % 30.8% Not Applicable # 61

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% 57.0%

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Golf Operations Assessment Appendices

Importance of Specific Improvements Rate the importance of the following improvements Classic 18 East 9 Grass tees # Respond 295 92 Avg score 6.58 5.11 % 9 or 10 43.2% 27.2% % 0 or 1 20.5% 33.7% Automatic teeing # Respond 287 84 Avg score 2.67 3.08 % 9 or 10 3.8% 9.5% % 0 or 1 61.5% 51.2% Adding target greens # Respond 290 88 Avg score 4.84 4.51 % 9 or 10 13.4% 11.4% % 0 or 1 25.9% 34.1% Add covered/heated stalls # Respond 286 87 Avg score 5.30 4.33 % 9 or 10 16.4% 13.8% % 0 or 1 23.1% 32.2% Add short game # Respond 285 91 Avg score 6.81 5.53 % 9 or 10 35.4% 18.7% % 0 or 1 13.3% 22.0% Move Range # Respond 290 86 Avg score 3.33 2.67 % 9 or 10 9.3% 7.0% % 0 or 1 49.7% 59.3% Expand Range # Respond 280 85 Avg score 3.94 3.19 % 9 or 10 13.2% 9.4% % 0 or 1 38.9% 52.9% Allow carts into Parking lot

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Rate the importance of the following improvements Classic 18 East 9 # Respond 284 88 Avg score 4.40 4.75 % 9 or 10 19.0% 21.6% % 0 or 1 40.1% 37.5% Add closer parking # Respond 283 87 Avg score 3.47 3.56 % 9 or 10 6.7% 11.5% % 0 or 1 45.9% 47.1% Renovating the Clubhouse # Respond 270 87 Avg score 4.69 4.31 % 9 or 10 15.2% 13.8% % 0 or 1 29.6% 31.0% Adding table service # Respond 280 87 Avg score 2.91 2.80 % 9 or 10 4.6% 5.7% % 0 or 1 50.0% 54.0% Adding bar # Respond 283 86 Avg score 3.59 3.57 % 9 or 10 10.6% 11.6% % 0 or 1 45.6% 50.0% Adding banquet/meeting space # Respond 283 97 Avg score 2.47 2.44 % 9 or 10 5.3% 7.2% % 0 or 1 61.5% 68.0% Continuous Cart Paths # Respond 285 87 Avg score 3.48 3.97 % 9 or 10 8.8% 14.9% % 0 or 1 46.0% 37.9% Improving Quality of Classic # Respond 290 80 Avg score 6.17 4.20 % 9 or 10 25.2% 7.5%

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Rate the importance of the following improvements Classic 18 East 9 % 0 or 1 10.3% 27.5% Improve Classic Greens # Respond 287 80 Avg score 6.31 4.18 % 9 or 10 29.3% 6.3% % 0 or 1 11.8% 27.5% Improve East 9 # Respond 282 85 Avg score 4.23 5.72 % 9 or 10 10.3% 22.4% % 0 or 1 32.6% 11.8% Convert carts to electric # Respond 288 89 Avg score 4.78 4.14 % 9 or 10 24.0% 20.2% % 0 or 1 36.5% 43.8% Adding carts to Anets # Respond 249 84 Avg score 1.67 3.51 % 9 or 10 1.6% 8.3% % 0 or 1 75.9% 65.5% Adding club storage # Respond 279 83 Avg score 2.17 2.83 % 9 or 10 2.9% 6.0% % 0 or 1 68.1% 65.1%

Sirius Golf Advisors, LLC 391

Golf Operations Assessment Appendices Appendix G: Financial Projections Scenario 0: Status Quo Sportsman’s Golf Sportsman's Golf Status Quo

2018 2019 2020 2021 2022 5 Year Rounds Classic 18 27,840 27,561 27,286 26,467 25,938 135,091 East 9 27,956 27,677 27,400 26,852 26,046 135,930 Total 55,796 55,238 54,685 53,319 51,984 271,022 Revenue Daily Fees Green Fees Classic 18 $928,068 $937,163 $946,347 $917,957 $899,598 $4,629,133 Green Fees East 9 $517,239 $522,308 $527,427 $516,878 $501,372 $2,585,225 Preferred Player Plan ($93,867) ($93,858) ($93,848) ($92,418) ($91,005) ($464,996) Daily Fees Program Fees $1,351,440 $1,365,614 $1,379,926 $1,342,417 $1,309,965 $6,749,362 Tournament Fees $29,815 $30,411 $31,019 $31,639 $32,272 $155,156 League Fees $40,428 $41,236 $42,061 $42,902 $43,760 $210,387 Program Fees $5,421 $5,530 $5,640 $5,753 $5,868 $28,213 Discount cards $18,666 $19,039 $19,420 $19,809 $20,205 $97,139 Program Fees $94,330 $96,216 $98,141 $100,103 $102,105 $490,895 Rentals Carts Classic 18 $230,142 $232,397 $234,674 $232,187 $232,094 $1,161,494 Carts East 9 $102,587 $103,593 $104,608 $104,566 $103,458 $518,811 Other Rentals $22,196 $22,413 $22,633 $22,508 $22,384 $112,134

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Golf Operations Assessment Appendices Sportsman's Golf Status Quo

2018 2019 2020 2021 2022 5 Year Rentals $332,729 $335,990 $339,282 $336,753 $335,552 $1,680,305 Proshop Sales $229,639 $231,889 $234,162 $232,877 $231,587 $1,160,154 Miscellaneous $7,435 $7,583 $7,735 $7,890 $8,048 $38,691 Total Revenue $2,015,573 $2,015,573 $2,037,292 $2,059,246 $2,020,040 $1,987,256

Cost of Sales $175,880 $177,604 $179,344 $178,360 $177,372 $888,560

Gross Profit $1,839,693 $1,859,689 $1,879,902 $1,841,680 $1,809,884 $9,230,848

Expenses Golf Operations Salary and Wages $317,738 $320,851 $323,996 $322,217 $320,433 $1,605,235 Employee Benefits $41,905 $43,585 $45,333 $46,437 $47,565 $224,825 Contractual Services GPS $43,537 $43,972 $44,412 $44,856 $45,305 $222,083 Other $23,946 $24,185 $24,427 $24,671 $24,918 $122,147 Contractual Services $67,483 $68,158 $68,839 $69,528 $70,223 $344,230 Supplies $36,158 $36,519 $36,885 $37,253 $37,626 $184,441

Total Golf Operations $463,284 $469,114 $475,053 $475,435 $475,847 $2,358,732

Course Maintenance Salary and Wages $462,649 $471,902 $481,340 $490,967 $500,786 $2,407,645 Employee Benefits $49,862 $52,385 $55,036 $57,821 $60,746 $275,850

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Golf Operations Assessment Appendices Sportsman's Golf Status Quo

2018 2019 2020 2021 2022 5 Year Contractual Services $29,329 $29,623 $29,919 $30,218 $30,520 $149,609 Grounds Repair $11,444 $12,021 $12,627 $13,263 $13,932 $63,287 Supplies Grounds Supplies $158,437 $160,021 $161,621 $163,237 $164,870 $808,185 Planting Supplies $28,616 $28,902 $29,191 $29,483 $29,778 $145,971 Program Operating Supplies $15,850 $16,009 $16,169 $16,331 $16,494 $80,853 Plumbing/Irrigation $13,018 $13,805 $14,640 $15,526 $16,465 $73,455 Other $8,611 $8,697 $8,784 $8,872 $8,961 $43,924 Supplies $224,532 $227,434 $230,406 $233,449 $236,568 $1,152,389 Total Course Maintenance $777,817 $793,365 $809,328 $825,718 $842,553 $4,048,780

Fleet Management Salary and Wages $52,193 $53,237 $54,302 $55,388 $56,495 $271,615 Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118 Contractual Services $5,706 $5,763 $5,820 $5,878 $5,937 $29,104 Repair & Maintenance $1,422 $1,436 $1,450 $1,465 $1,479 $7,251 Supplies Equipment Supplies $48,642 $49,129 $49,620 $50,116 $50,617 $248,125 Fuel Supplies $45,578 $46,034 $46,494 $46,959 $47,428 $232,492 Other $4,783 $4,831 $4,879 $4,928 $4,977 $24,397 Supplies $99,003 $99,993 $100,993 $102,003 $103,023 $505,014 Sportsman's Fleet $180,571 $183,344 $186,168 $189,045 $191,975 $931,102

Sirius Golf Advisors, LLC 394

Golf Operations Assessment Appendices Sportsman's Golf Status Quo

2018 2019 2020 2021 2022 5 Year General & Administrative Contractual Services $8,118 $8,199 $8,281 $8,364 $8,448 $41,411 Supplies $815 $824 $832 $840 $848 $4,159 Total G&A $8,934 $9,023 $9,113 $9,204 $9,296 $45,570

Total Expenses $1,430,605 $1,454,846 $1,479,661 $1,499,402 $1,519,671 $7,384,184 Net Operating Income $409,088 $404,843 $400,241 $342,278 $290,213 $1,846,664

Sirius Golf Advisors, LLC 395

Golf Operations Assessment Appendices Sportsman's Golf Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Rounds Classic 18 25,419 24,656 23,917 23,199 22,503 119,695 254,786 East 9 25,265 24,507 23,772 23,059 22,367 118,969 254,899 Total 50,684 49,163 47,688 46,258 44,870 238,663 509,685 Revenue Daily Fees Green Fees Classic 18 $863,974 $838,054 $812,913 $772,755 $734,581 $4,022,277 $8,651,410 Green Fees East 9 $476,604 $462,306 $448,437 $426,284 $405,226 $2,218,857 $4,804,082 Preferred Player Plan ($89,616) ($87,797) ($86,015) ($84,269) ($82,558) ($430,256) ($895,251) Daily Fees $1,250,961 $1,212,563 $1,175,335 $1,114,770 $1,057,248 $5,810,878 $12,560,240 Program Fees Tournament Fees $32,918 $33,576 $34,248 $34,933 $35,631 $171,305 $326,462 League Fees $44,635 $45,528 $46,439 $47,367 $48,315 $232,285 $442,672 Program Fees $5,986 $6,105 $6,227 $6,352 $6,479 $31,149 $59,362 Discount cards $20,609 $21,021 $21,441 $21,870 $22,308 $107,249 $204,387 Program Fees $104,148 $106,230 $108,355 $110,522 $112,733 $541,988 $1,032,883 Rentals Carts Classic 18 $232,001 $229,542 $227,109 $224,702 $222,320 $1,135,673 $2,297,167 Carts East 9 $102,361 $101,276 $100,202 $99,140 $98,089 $501,069 $1,019,880 Other Rentals $22,260 $22,025 $21,791 $21,560 $21,332 $108,968 $221,101 Rentals $334,362 $330,818 $327,311 $323,842 $320,409 $1,636,742 $3,317,047 Proshop Sales $230,311 $227,870 $225,454 $223,064 $220,700 $1,127,399 $2,287,553 Miscellaneous $8,209 $8,373 $8,540 $8,711 $8,885 $42,718 $81,409 Total Revenue $1,927,991 $1,885,854 $1,844,996 $1,780,910 $1,719,975 $9,159,725 $19,279,132

Cost of Sales $176,395 $174,525 $172,675 $170,845 $169,034 $863,473 $1,752,032

Gross Profit $1,751,596 $1,711,329 $1,672,321 $1,610,065 $1,550,942 $8,296,252 $17,527,100

Sirius Golf Advisors, LLC 396

Golf Operations Assessment Appendices Sportsman's Golf Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year

Expenses Golf Operations Salary and Wages $318,667 $315,290 $311,947 $308,641 $305,369 $1,559,914 $3,165,149 Employee Benefits $48,722 $49,652 $50,599 $51,565 $52,549 $253,086 $477,911 Contractual Services GPS $45,758 $46,215 $46,678 $47,144 $47,616 $233,411 $455,494 Other $25,167 $25,419 $25,673 $25,930 $26,189 $128,378 $250,526 Contractual Services $70,925 $71,634 $72,351 $73,074 $73,805 $361,789 $706,020 Supplies $38,002 $38,382 $38,766 $39,154 $39,545 $193,849 $378,291

Total Golf Operations $476,317 $474,958 $473,663 $472,433 $471,268 $2,368,639 $4,727,371

Course Maintenance Salary and Wages $490,771 $500,586 $490,574 $500,386 $510,393 $2,492,710 $4,900,355 Employee Benefits $61,317 $64,420 $65,026 $68,316 $71,773 $330,852 $606,702 Contractual Services $30,825 $31,134 $31,445 $31,760 $32,077 $157,241 $306,850 Grounds Repair $14,634 $15,371 $16,146 $16,960 $17,815 $80,926 $144,213 Supplies Grounds Supplies $161,572 $163,188 $159,924 $161,523 $163,139 $809,347 $1,617,532 Planting Supplies $29,183 $29,474 $28,885 $29,174 $29,465 $146,181 $292,152 Program Operating Supplies $16,659 $16,825 $16,994 $17,164 $17,335 $84,977 $165,829 Plumbing/Irrigation $17,462 $18,518 $19,638 $20,827 $22,087 $98,531 $171,986 Other $9,050 $9,141 $9,232 $9,324 $9,418 $46,165 $90,090 Supplies $233,926 $237,147 $234,673 $238,012 $241,444 $1,185,201 $2,337,589 Total Course Maintenance $831,473 $848,658 $837,865 $855,433 $873,502 $4,246,930 $8,295,710

Fleet Management Salary and Wages $57,625 $58,778 $59,953 $61,152 $62,376 $299,885 $571,499

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Golf Operations Assessment Appendices Sportsman's Golf Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services $5,997 $6,057 $6,117 $6,178 $6,240 $30,589 $59,693 Repair & Maintenance $1,494 $1,509 $1,524 $1,539 $1,555 $7,621 $14,873 Supplies Equipment Supplies $51,124 $51,635 $52,151 $52,673 $53,199 $260,782 $508,907 Fuel Supplies $47,903 $48,382 $48,866 $49,354 $49,848 $244,352 $476,844 Other $5,027 $5,077 $5,128 $5,179 $5,231 $25,641 $50,038 Supplies $104,053 $105,094 $106,145 $107,206 $108,278 $530,775 $1,035,790 Sportsman's Fleet $194,961 $198,002 $201,101 $204,259 $207,477 $1,005,801 $1,936,903

General & Administrative Contractual Services $8,532 $8,618 $8,704 $8,791 $8,879 $43,523 $84,933 Supplies $857 $866 $874 $883 $892 $4,371 $8,531 Total G&A $9,389 $9,483 $9,578 $9,674 $9,770 $47,894 $93,464

Total Expenses $1,512,139 $1,531,101 $1,522,207 $1,541,799 $1,562,017 $7,669,264 $15,053,448 Net Operating Income $239,457 $180,228 $150,113 $68,266 ($11,076) $626,988 $2,473,652

Sirius Golf Advisors, LLC 398

Golf Operations Assessment Appendices Range Driving Range Status Quo 2018 2019 2020 2021 2022 5 Year Revenue Range Buckets $253,631 $256,167 $258,729 $256,142 $254,861 $1,279,531 Rentals $981.24 $991.05 $1,000.96 $990.95 $986.00 $4,950 Other $8,492 $8,577 $8,663 $8,576 $8,533 $42,841 Total Revenue $263,104 $265,736 $268,393 $265,709 $264,380 $1,327,322 Expenses Salary and Wages $25,221 $25,726 $26,240 $26,765 $27,300 $131,252 Employee Benefits $0 $0 $0 $0 $0 $0 Supplies $30,909 $31,218 $31,530 $31,846 $32,164 $157,667 Other $1,308 $1,322 $1,335 $1,348 $1,362 $6,675 Total Expenses $56,130 $56,944 $57,770 $58,610 $59,464 $288,919 Net Operating Income $206,974 $208,792 $210,623 $207,099 $204,916 $1,038,404

2023 2024 2025 2026 2027 5 Year 10 Year Revenue Range Buckets $253,587 $252,319 $249,796 $247,298 $244,825 $1,247,824 $2,527,355 Rentals $981.07 $976.16 $966.40 $956.74 $947.17 $4,828 $9,778 Other $8,491 $8,448.13 $8,363.65 $8,280.01 $8,197.21 $41,780 $84,621 Total Revenue $263,058 $261,743 $259,126 $256,535 $253,969 $1,294,431 $2,621,753 Expenses Salary and Wages $27,846 $28,403 $28,971 $29,551 $30,142 $144,912 $276,164 Employee Benefits $0 $0 $0 $0 $0 $0 $0 Supplies $32,486 $32,811 $33,139 $33,470 $33,805 $165,710 $323,377 Other $1,375 $1,389 $1,403 $1,417 $1,431 $7,015 $13,690 Total Expenses $60,332 $61,214 $62,110 $63,021 $63,946 $310,622 $599,541 Net Operating Income $202,727 $200,530 $197,016 $193,514 $190,023 $983,809 $2,022,213

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Golf Operations Assessment Appendices

Academy Academy Status Quo 2018 2019 2020 2021 2022 5 Year Revenue Group $221,487 $225,917 $228,176 $227,035 $225,900 $1,128,515 Private Lessons $155,041 $158,142 $159,723 $158,925 $158,130 $789,961 Total Revenue $376,528 $384,059 $387,899 $385,960 $384,030 $1,918,476 Cost of Sales $161,361 $164,588 $166,234 $165,403 $164,576 $822,163 Gross Profit $215,167 $219,470 $221,665 $220,557 $219,454 $1,096,313 Expenses Salary and Wages $23,539 $24,009 $24,490 $24,979 $25,479 $122,496 Employee Benefits $30,681 $31,602 $32,550 $33,526 $34,532 $162,891 Supplies $20,014 $20,414 $20,822 $21,239 $21,664 $104,153 Other $55,322 $56,428 $57,557 $58,708 $59,882 $287,897 Total Expenses $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Net Operating Income $85,612 $87,017 $86,247 $82,105 $77,897 $418,877

Academy Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Group $224,770 $223,647 $221,410 $219,196 $217,004 $1,106,027 $2,234,542 Private Lessons $157,339 $156,553 $154,987 $153,437 $151,903 $774,219 $1,564,180 Total Revenue $382,110 $380,199 $376,397 $372,633 $368,907 $1,880,246 $3,798,722 Cost of Sales $163,753 $162,934 $161,305 $159,692 $158,095 $805,779 $1,627,942 Gross Profit $218,357 $217,265 $215,092 $212,941 $210,812 $1,074,467 $2,170,780 Expenses Salary and Wages $25,988 $26,508 $27,038 $27,579 $28,131 $135,245 $257,741

Sirius Golf Advisors, LLC 400

Golf Operations Assessment Appendices Academy Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Employee Benefits $35,568 $36,635 $37,734 $38,866 $40,032 $188,835 $351,726 Supplies $22,097 $22,539 $22,990 $23,449 $23,918 $114,993 $219,146 Other $61,080 $62,301 $63,547 $64,818 $66,115 $317,861 $605,758 Total Expenses $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Net Operating Income $73,624 $69,282 $63,783 $58,228 $52,616 $317,533 $736,410

Sirius Golf Advisors, LLC 401

Golf Operations Assessment Appendices Anetsberger Anetsberger Status Quo 2018 2019 2020 2021 2022 5 Year Rounds 11,025 10,970 10,915 10,861 10,806 54,577 Revenue Green Fees $74,497 $75,607 $76,734 $77,877 $79,037 $383,752 Tournament Fees $1,686 $1,711 $1,736 $1,762 $1,789 $8,684 Memberships $22,866 $23,207 $23,552 $23,903 $24,259 $117,787 Rentals $3,917 $3,976 $4,035 $4,095 $4,156 $20,180 Merchandise $17,567 $17,828 $18,094 $18,364 $18,637 $90,489 Total Revenue $120,533 $122,329 $124,151 $126,001 $127,879 $620,892 Cost of Sales $11,048 $11,212 $11,379 $11,549 $11,721 $56,909 Gross Profit $109,485 $111,116 $112,772 $114,452 $116,158 $563,983 Expenses Golf Operations Salary and Wages $33,593 $34,265 $34,951 $35,650 $36,363 $174,822 Contractual Services $2,318 $2,341 $2,365 $2,388 $2,412 $11,825 Repairs & Maint $1,297 $1,310 $1,323 $1,336 $1,349 $6,615 Supplies $1,726 $1,743 $1,760 $1,778 $1,796 $8,803 Total Operations $38,934 $39,659 $40,399 $41,152 $41,920 $202,065 Course Maintenance Salary and Wages $24,762 $25,258 $25,763 $26,278 $26,804 $128,865 Contractual Services $3,169 $3,233 $3,297 $3,363 $3,430 $16,493 Repairs & Maint $2,625 $2,677 $2,731 $2,786 $2,841 $13,660 Supplies $27,341 $27,888 $28,446 $29,015 $29,595 $142,285 Total Course Maintenance $57,898 $59,056 $60,237 $61,442 $62,671 $301,303 Total Expenses $96,832 $98,715 $100,636 $102,594 $104,591 $503,368 Net Operating Income $12,653 $12,401 $12,136 $11,858 $11,567 $60,616

Sirius Golf Advisors, LLC 402

Golf Operations Assessment Appendices Anetsberger Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Rounds 10,752 10,699 10,645 10,592 10,539 53,226 107,804 Revenue Green Fees $80,215 $81,410 $82,623 $83,854 $85,104 $413,206 $796,958 Tournament Fees $1,815 $1,842 $1,870 $1,898 $1,926 $9,351 $18,035 Memberships $24,621 $24,988 $25,360 $25,738 $26,121 $126,828 $244,615 Rentals $4,218 $4,281 $4,345 $4,409 $4,475 $21,728 $41,908 Merchandise $18,915 $19,197 $19,483 $19,773 $20,068 $97,435 $187,924 Total Revenue $129,784 $131,718 $133,680 $135,672 $137,694 $668,548 $1,289,440 Cost of Sales $11,896 $12,073 $12,253 $12,435 $12,620 $61,277 $118,185 Gross Profit $117,888 $119,645 $121,428 $123,237 $125,073 $607,271 $1,171,255 Expenses Golf Operations Salary and Wages $37,090 $37,832 $38,588 $39,360 $40,147 $193,017 $367,839 Contractual Services $2,436 $2,461 $2,485 $2,510 $2,535 $12,428 $24,253 Repairs & Maint $1,363 $1,377 $1,390 $1,404 $1,418 $6,952 $13,567 Supplies $1,814 $1,832 $1,850 $1,869 $1,887 $9,252 $18,055 Total Operations $42,703 $43,501 $44,314 $45,143 $45,988 $221,650 $423,714 Course Maintenance Salary and Wages $27,340 $27,887 $28,444 $29,013 $29,593 $142,277 $271,142 Contractual Services $3,499 $3,569 $3,640 $3,713 $3,787 $18,209 $34,702 Repairs & Maint $2,898 $2,956 $3,015 $3,076 $3,137 $15,082 $28,743 Supplies $30,187 $30,791 $31,407 $32,035 $32,675 $157,094 $299,380 Total Course Maintenance $63,924 $65,202 $66,507 $67,837 $69,193 $332,663 $633,966 Total Expenses $106,627 $108,703 $110,821 $112,980 $115,182 $554,313 $1,057,680 Net Operating Income $11,261 $10,942 $10,607 $10,257 $9,891 $52,958 $113,574

Sirius Golf Advisors, LLC 403

Golf Operations Assessment Appendices

Division Division Expenses Status Quo 2018 2019 2020 2021 2022 5 Year Buildings and Facilities Salary and Wages $47,829 $48,786 $49,761 $50,756 $51,772 $248,904 Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118 Contractual Services Building Maintenance Services $34,455 $34,799 $35,147 $35,499 $35,854 $175,754 Utilities $87,089 $87,959 $88,839 $89,727 $90,625 $444,239 Other $3,117 $3,148 $3,179 $3,211 $3,243 $15,897 CONTRACTUAL SERVICES $124,660 $125,906 $127,165 $128,437 $129,721 $635,890 Repairs & Maint Building Repairs $10,439 $10,543 $10,649 $10,755 $10,863 $53,249 Equipment Repairs $4,079 $4,119 $4,161 $4,202 $4,244 $20,805 REPAIR & MAINTENANCE $14,518 $14,663 $14,809 $14,957 $15,107 $74,054 Supplies Building Supplies $8,372 $8,456 $8,540 $8,625 $8,712 $42,705 Janitorial Supplies $5,424 $5,479 $5,533 $5,589 $5,645 $27,669 Other $11,601 $11,717 $11,835 $11,953 $12,073 $59,179 SUPPLIES $25,398 $25,652 $25,908 $26,167 $26,429 $129,553 Subtotal Building/Facility $234,652 $237,922 $241,247 $244,629 $248,069 $1,206,518 General & Administrative Salary and Wages $108,458 $110,627 $112,840 $115,097 $117,399 $564,420 Employee Benefits $28,090 $28,932 $29,800 $30,694 $31,615 $149,131 Contractual Services Bank Fees/Charges $55,938 $56,618 $57,230 $56,379 $55,686 $281,851 Advertising $2,323 $2,346 $2,370 $2,393 $2,417 $11,850 Printing $3,866 $3,905 $3,944 $3,983 $4,023 $19,721 Other $3,961 $4,001 $4,041 $4,081 $4,122 $20,205

Sirius Golf Advisors, LLC 404

Golf Operations Assessment Appendices Division Expenses Status Quo 2018 2019 2020 2021 2022 5 Year Unemployment Reimbursement $80,118 $80,919 $81,729 $82,546 $83,371 $408,684 CONTRACTUAL SERVICES $146,206 $147,789 $149,313 $149,383 $149,620 $742,310 Administrative Charges FICA $79,885 $81,247 $82,633 $83,684 $84,758 $412,208 Medicare $18,683 $19,001 $19,326 $19,571 $19,823 $96,404 IMRF $110,310 $112,190 $114,105 $115,556 $117,039 $569,200 Life Insurance $710 $722 $734 $743 $753 $3,662 PDRMA portion (16%) $51,543 $52,422 $53,316 $53,994 $54,687 $265,962 Golf Conferences $8,200 $8,282 $8,365 $8,448 $8,533 $41,828 Software $4,921 $4,970 $5,020 $5,070 $5,120 $25,100 Administration Overhead $25,748 $21,166 $16,502 $12,933 $9,288 $85,636 DEPARTMENT TRANFERS $300,000 $300,000 $300,000 $300,000 $300,000 $1,500,000 Total G&A $582,754 $587,348 $591,952 $595,173 $598,634 $2,955,861 Total Expenses $817,406 $825,270 $833,199 $839,802 $846,703 $4,162,380

Division Expenses Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Buildings and Facilities Salary and Wages $52,807 $53,863 $54,940 $56,039 $57,160 $274,810 $523,713 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services Building Maintenance Services $36,212 $36,574 $36,940 $37,310 $37,683 $184,719 $360,473 Utilities $91,531 $92,446 $93,371 $94,304 $95,247 $466,900 $911,139 Other $3,275 $3,308 $3,341 $3,375 $3,408 $16,708 $32,606 CONTRACTUAL SERVICES $131,019 $132,329 $133,652 $134,989 $136,339 $668,327 $1,304,217 Repairs & Maint Building Repairs $10,971 $11,081 $11,192 $11,304 $11,417 $55,965 $109,213 Equipment Repairs $4,287 $4,330 $4,373 $4,417 $4,461 $21,867 $42,672

Sirius Golf Advisors, LLC 405

Golf Operations Assessment Appendices Division Expenses Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year REPAIR & MAINTENANCE $15,258 $15,411 $15,565 $15,720 $15,878 $77,832 $151,886 Supplies Building Supplies $8,799 $8,887 $8,976 $9,065 $9,156 $44,883 $87,588 Janitorial Supplies $5,701 $5,758 $5,816 $5,874 $5,932 $29,081 $56,750 Other $12,193 $12,315 $12,438 $12,563 $12,688 $62,198 $121,377 SUPPLIES $26,693 $26,960 $27,230 $27,502 $27,777 $136,162 $265,715 Subtotal Building/Facility $251,568 $255,128 $258,749 $262,433 $266,182 $1,294,060 $2,500,579 General & Administrative Salary and Wages $119,746 $122,141 $124,584 $127,076 $129,617 $623,166 $1,187,586 Employee Benefits $32,563 $33,540 $34,547 $35,583 $36,650 $172,884 $322,015 Contractual Services Bank Fees/Charges $54,472 $53,602 $52,696 $51,333 $50,037 $262,140 $543,991 Advertising $2,441 $2,466 $2,491 $2,515 $2,541 $12,454 $24,304 Printing $4,063 $4,104 $4,145 $4,187 $4,228 $20,727 $40,449 Other $4,163 $4,205 $4,247 $4,289 $4,332 $21,235 $41,440 Unemployment Reimbursement $84,205 $85,047 $85,898 $86,757 $87,624 $429,531 $838,214 CONTRACTUAL SERVICES $149,345 $149,423 $149,476 $149,081 $148,762 $746,088 $1,488,398 Administrative Charges FICA $84,397 $85,374 $84,919 $85,922 $86,952 $427,565 $839,772 Medicare $19,738 $19,967 $19,860 $20,095 $20,336 $99,995 $196,400 IMRF $116,540 $117,890 $117,261 $118,646 $120,068 $590,405 $1,159,604 Life Insurance $750 $758 $754 $763 $772 $3,799 $7,461 PDRMA portion (16%) $54,454 $55,085 $54,791 $55,438 $56,102 $275,870 $541,832 Golf Conferences $8,618 $8,704 $8,792 $8,879 $8,968 $43,962 $85,790 Software $5,172 $5,223 $5,276 $5,328 $5,382 $26,380 $51,481 Administration Overhead $10,330 $6,998 $8,347 $4,929 $1,420 $32,024 $117,660 DEPARTMENT TRANFERS $300,000 $300,000 $300,000 $300,000 $300,000 $1,500,000 $3,000,000 Total G&A $601,655 $605,105 $608,607 $611,740 $615,030 $3,042,137 $5,997,998 Total Expenses $853,224 $860,233 $867,356 $874,173 $881,212 $4,336,197 $8,498,577

Sirius Golf Advisors, LLC 406

Golf Operations Assessment Appendices

Composite Composite Status Quo 2018 2019 2020 2021 2022 5 Year Revenue SCC Golf $2,015,573 $2,037,292 $2,059,246 $2,020,040 $1,987,256 $10,119,407 Range $263,104 $265,736 $268,393 $265,709 $264,380 $1,327,322 Academy $376,528 $384,059 $387,899 $385,960 $384,030 $1,918,476 Miniature Golf $24,102 $24,584 $25,076 $25,578 $26,089 $125,430 Anetsberger $120,533 $122,329 $124,151 $126,001 $127,879 $620,892 Other $19,639 $19,731 $19,826 $18,420 $17,167 $94,783 Total Revenue $2,819,479 $2,853,731 $2,884,591 $2,841,708 $2,806,802 $14,206,310 Cost of Sales SCC Golf $175,880 $177,604 $179,344 $178,360 $177,372 $888,560 Academy $161,361 $164,588 $166,234 $165,403 $164,576 $822,163 Anetsberger $11,048 $11,212 $11,379 $11,549 $11,721 $56,909 Total COG $348,289 $353,404 $356,958 $355,311 $353,669 $1,767,631 Gross Profit $2,471,190 $2,500,327 $2,527,633 $2,486,396 $2,453,133 $12,438,679 Expenses SCC Golf $1,430,605 $1,454,846 $1,479,661 $1,499,402 $1,519,671 $7,384,184 Range $56,130 $56,944 $57,770 $58,610 $59,464 $288,919 Academy $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Anetsberger $96,832 $98,715 $100,636 $102,594 $104,591 $503,368 Other $7,208 $6,910 $6,861 $6,814 $6,652 $34,445 Division $817,406 $825,270 $833,199 $839,802 $846,703 $4,162,380 Total Expenses $2,537,736 $2,575,137 $2,613,546 $2,645,675 $2,678,637 $13,050,731 NOI ($66,546) ($74,811) ($85,913) ($159,279) ($225,504) ($612,052) Capital Allowance $280,000 $285,600 $291,312 $297,138 $303,081 $1,457,131 CASH FLOW ($346,546) ($360,411) ($377,225) ($456,417) ($528,585) ($2,069,184)

Sirius Golf Advisors, LLC 407

Golf Operations Assessment Appendices Composite Status Quo 2023 2024 2025 2026 2027 5 Year 10 Year Revenue SCC Golf $1,927,991 $1,885,854 $1,844,996 $1,780,910 $1,719,975 $9,159,725 $19,279,132 Range $263,058 $261,743 $259,126 $256,535 $253,969 $1,294,431 $2,621,753 Academy $382,110 $380,199 $376,397 $372,633 $368,907 $1,880,246 $3,798,722 Miniature Golf $26,611 $27,143 $27,686 $28,240 $28,805 $138,484 $263,914 Anetsberger $129,784 $131,718 $133,680 $135,672 $137,694 $668,548 $1,289,440 Other $16,051 $15,059 $14,178 $13,398 $12,708 $71,394 $166,177 Total Revenue $2,745,605 $2,701,716 $2,656,063 $2,587,387 $2,522,057 $13,212,828 $27,419,138 Cost of Sales SCC Golf $176,395 $174,525 $172,675 $170,845 $169,034 $863,473 $1,752,032 Academy $163,753 $162,934 $161,305 $159,692 $158,095 $805,779 $1,627,942 Anetsberger $11,896 $12,073 $12,253 $12,435 $12,620 $61,277 $118,185 Total COG $352,043 $349,532 $346,233 $342,972 $339,749 $1,730,529 $3,498,159 Gross Profit $2,393,562 $2,352,184 $2,309,830 $2,244,415 $2,182,308 $11,482,300 $23,920,978 Expenses SCC Golf $1,512,139 $1,531,101 $1,522,207 $1,541,799 $1,562,017 $7,669,264 $15,053,448 Range $60,332 $61,214 $62,110 $63,021 $63,946 $310,622 $599,541 Academy $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Anetsberger $106,627 $108,703 $110,821 $112,980 $115,182 $554,313 $1,057,680 Other $6,607 $6,507 $6,356 $6,209 $6,067 $31,746 $66,192 Division $853,224 $860,233 $867,356 $874,173 $881,212 $4,336,197 $8,498,577 Total Expenses $2,683,661 $2,715,741 $2,720,158 $2,752,895 $2,786,620 $13,659,076 $26,709,807 NOI ($290,100) ($363,557) ($410,328) ($508,480) ($604,312) ($2,176,777) ($2,788,829) Capital Allowance $309,143 $315,325 $321,632 $328,065 $334,626 $1,608,791 $2,788,829 CASH FLOW ($599,242) ($678,883) ($731,960) ($836,544) ($938,938) ($3,785,567) ($5,854,751)

Sirius Golf Advisors, LLC 408

Golf Operations Assessment Appendices Scenario 1: Minimal Sportsman’s Golf Sportsman's Golf Minimal 2018 2019 2020 2021 2022 5 Year Rounds Classic 18 29,218 24,500 24,990 25,240 31,000 134,948 East 9 29,208 9,500 9,690 9,787 30,500 88,685 Total 58,426 34,000 34,680 35,027 61,500 223,632 Revenue Daily Fees Green Fees Classic 18 $974,012 $833,072 $866,728 $875,395 $1,075,173 $4,624,380 Green Fees East 9 $540,399 $179,283 $186,526 $188,391 $587,104 $1,681,704 Preferred Player Plan ($90,428) ($53,150) ($54,755) ($55,855) ($99,051) ($353,239) Daily Fees $1,423,983 $959,205 $998,499 $1,007,931 $1,563,226 $5,952,845 Program Fees Tournament Fees $31,305 $12,500 $12,750 $13,005 $35,000 $104,560 League Fees $40,428 $34,000 $34,680 $35,374 $43,500 $187,981 Program Fees $5,747 $5,979 $6,220 $6,408 $6,602 $30,955 Discount cards $19,786 $11,500 $11,965 $12,326 $24,500 $80,076 Program Fees $97,266 $63,979 $65,615 $67,113 $109,602 $403,574 Rentals Carts Classic 18 $241,535 $206,585 $214,931 $221,421 $277,392 $1,161,863 Carts East 9 $107,181 $35,558 $36,995 $38,112 $121,148 $338,994 Other Rentals $23,242 $13,796 $14,353 $14,787 $26,481 $92,658 Rentals $348,715 $242,143 $251,925 $259,534 $398,540 $1,500,858 Proshop Sales $336,648 $199,826 $207,899 $214,177 $383,573 $1,342,124 Food & Beverage Revenue

Gross Sales $438,193 $260,100 $270,608 $278,780 $499,272 $1,746,953

NPD Share $43,819 $26,010 $27,061 $27,878 $49,927 $174,695

Sirius Golf Advisors, LLC 409

Golf Operations Assessment Appendices Sportsman's Golf Minimal 2018 2019 2020 2021 2022 5 Year

Miscellaneous & Winter $11,923 $12,161 $12,404 $12,653 $12,906 $62,047

Total Revenue $2,262,355 $1,503,324 $1,563,404 $1,589,285 $2,517,774 $9,436,141

Cost of Sales $257,838 $153,046 $159,229 $164,038 $293,778 $1,027,930

Gross Profit $2,004,516 $1,350,278 $1,404,174 $1,425,247 $2,223,996 $8,408,212

Expenses

Golf Operations

Salary and Wages $332,714 $265,000 $270,300 $275,706 $379,091 $1,522,811

Employee Benefits $43,881 $35,998 $37,820 $39,734 $56,272 $213,705

Contractual Services

GPS $43,537 $32,000 $32,000 $32,000 $45,305 $184,842

Other $23,946 $24,185 $24,427 $24,671 $24,918 $122,147

Contractual Services $67,483 $56,185 $56,427 $56,671 $70,223 $306,989

Supplies $36,158 $36,519 $36,885 $37,253 $37,626 $184,441

Total Golf Operations $480,235 $393,703 $401,432 $409,364 $543,212 $2,227,946

Course Maintenance

Salary and Wages $462,649 $471,902 $481,340 $490,967 $500,786 $2,407,645

Employee Benefits $49,862 $52,385 $55,036 $57,821 $60,746 $275,850

Contractual Services $29,329 $29,623 $29,919 $30,218 $30,520 $149,609

Grounds Repair $10,899 $11,008 $11,118 $11,230 $11,342 $55,597

Supplies

Grounds Supplies $158,437 $160,021 $161,621 $163,237 $164,870 $808,185

Planting Supplies $28,616 $28,902 $29,191 $29,483 $29,778 $145,971

Program Operating Supplies $15,850 $16,009 $16,169 $16,331 $16,494 $80,853

Plumbing/Irrigation $13,018 $13,148 $13,279 $13,412 $13,546 $66,403

Sirius Golf Advisors, LLC 410

Golf Operations Assessment Appendices Sportsman's Golf Minimal 2018 2019 2020 2021 2022 5 Year

Other $8,611 $8,697 $8,784 $8,872 $8,961 $43,924

Supplies $224,532 $226,777 $229,045 $231,335 $233,648 $1,145,337

Total Course Maintenance $777,272 $791,695 $806,458 $821,570 $837,043 $4,034,038

Fleet Management

Salary and Wages $52,193 $53,237 $54,302 $55,388 $56,495 $271,615

Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118

Contractual Services $5,706 $5,763 $5,820 $5,878 $5,937 $29,104

Repair & Maintenance $1,422 $1,436 $1,450 $1,465 $1,479 $7,251

Supplies

Equipment Supplies $48,642 $49,129 $49,620 $50,116 $50,617 $248,125

Fuel Supplies $45,578 $46,034 $46,494 $46,959 $47,428 $232,492

Other $4,783 $4,831 $4,879 $4,928 $4,977 $24,397

Supplies $99,003 $99,993 $100,993 $102,003 $103,023 $505,014

Sportsman's Fleet $180,571 $183,344 $186,168 $189,045 $191,975 $931,102

General & Administrative

Contractual Services $8,118 $8,199 $8,281 $8,364 $8,448 $41,411

Building Maintenance Srv $6,060 $6,424 $6,552 $6,683 $6,750 $32,469

Supplies $815 $824 $832 $840 $848 $4,159

Total G&A $8,934 $9,023 $9,113 $9,204 $9,296 $45,570

Total Expenses $1,447,012 $1,377,765 $1,403,170 $1,429,184 $1,581,527 $7,238,657

Net Operating Income $557,505 ($27,487) $1,004 ($3,936) $642,469 $1,169,555

Sirius Golf Advisors, LLC 411

Golf Operations Assessment Appendices Sportsman's Golf Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Rounds Classic 18 31,155 30,532 29,921 29,323 28,736 149,667 284,615 East 9 30,653 30,039 29,439 28,850 28,273 147,253 235,938 Total 61,808 60,571 59,360 58,173 57,009 296,921 520,553 Revenue Daily Fees Green Fees Classic 18 $1,080,549 $1,058,938 $1,037,759 $996,664 $957,196 $5,131,104 $9,755,484 Green Fees East 9 $590,040 $578,239 $566,674 $544,234 $522,682 $2,801,870 $4,483,574 Preferred Player Plan ($100,542) ($99,516) ($98,501) ($97,497) ($96,502) ($492,559) ($845,798) Daily Fees $1,570,047 $1,537,660 $1,505,932 $1,443,401 $1,383,376 $7,440,416 $13,393,260 Program Fees Tournament Fees $35,700 $36,414 $37,142 $37,885 $38,643 $185,784 $290,345 League Fees $44,370 $45,257 $46,163 $47,086 $48,028 $230,903 $418,885 Program Fees $6,767 $6,765 $6,762 $6,759 $6,757 $33,810 $64,765 Discount cards $25,115 $25,105 $25,095 $25,085 $25,075 $125,474 $205,551 Program Fees $111,952 $113,541 $115,162 $116,815 $118,502 $575,972 $979,545 Rentals Carts Classic 18 $284,355 $284,241 $284,127 $284,013 $283,900 $1,420,636 $2,582,499 Carts East 9 $124,189 $124,140 $124,090 $124,040 $123,991 $620,449 $959,444 Other Rentals $27,146 $27,135 $27,124 $27,113 $27,103 $135,622 $228,280 Rentals $408,544 $408,380 $408,217 $408,054 $407,890 $2,041,085 $3,541,943 Proshop Sales $393,201 $393,044 $392,887 $392,729 $392,572 $1,964,433 $3,306,557 Food & Beverage Revenue Gross Sales $511,804 $511,599 $511,394 $511,190 $510,985 $2,556,971 $4,303,924 NPD Share $51,180 $51,160 $51,139 $51,119 $51,099 $255,697 $430,392 Miscellaneous & Winter $13,164 $13,427 $13,696 $13,969 $14,249 $68,504 $130,551 Total Revenue $2,548,088 $2,517,212 $2,487,032 $2,426,087 $2,367,688 $12,346,107 $21,782,248

Sirius Golf Advisors, LLC 412

Golf Operations Assessment Appendices Sportsman's Golf Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Cost of Sales $301,152 $301,031 $300,911 $300,791 $300,670 $1,504,555 $2,532,485

Gross Profit $2,246,936 $2,216,181 $2,186,121 $2,125,297 $2,067,017 $10,841,552 $19,249,763

Expenses Golf Operations Salary and Wages $388,606 $388,451 $388,295 $388,140 $387,985 $1,941,477 $3,464,288 Employee Benefits $59,415 $61,173 $62,983 $64,847 $66,765 $315,183 $528,887 Contractual Services GPS $45,758 $46,215 $46,678 $47,144 $47,616 $233,411 $418,253 Other $25,167 $25,419 $25,673 $25,930 $26,189 $128,378 $250,526 Contractual Services $70,925 $71,634 $72,351 $73,074 $73,805 $361,789 $668,779 Supplies $38,002 $38,382 $38,766 $39,154 $39,545 $193,849 $378,291

Total Golf Operations $556,949 $559,640 $562,395 $565,214 $568,100 $2,812,299 $5,040,245

Course Maintenance Salary and Wages $490,771 $500,586 $490,574 $500,386 $510,393 $2,492,710 $4,900,355 Employee Benefits $61,317 $64,420 $65,026 $68,316 $71,773 $330,852 $606,702 Contractual Services $30,825 $31,134 $31,445 $31,760 $32,077 $157,241 $306,850 Grounds Repair $11,455 $11,570 $11,685 $11,802 $11,920 $58,433 $114,030 Supplies Grounds Supplies $161,572 $163,188 $159,924 $161,523 $163,139 $809,347 $1,617,532 Planting Supplies $29,183 $29,474 $28,885 $29,174 $29,465 $146,181 $292,152 Program Operating Supplies $16,659 $16,825 $16,994 $17,164 $17,335 $84,977 $165,829 Plumbing/Irrigation $13,682 $13,818 $13,957 $14,096 $14,237 $69,790 $136,193 Other $9,050 $9,141 $9,232 $9,324 $9,418 $46,165 $90,090 Supplies $230,146 $232,447 $228,992 $231,281 $233,594 $1,156,460 $2,301,797

Sirius Golf Advisors, LLC 413

Golf Operations Assessment Appendices Sportsman's Golf Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Total Course Maintenance $824,514 $840,157 $827,722 $843,545 $859,758 $4,195,696 $8,229,734

Fleet Management Salary and Wages $57,625 $58,778 $59,953 $61,152 $62,376 $299,885 $571,499 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services $5,997 $6,057 $6,117 $6,178 $6,240 $30,589 $59,693 Repair & Maintenance $1,494 $1,509 $1,524 $1,539 $1,555 $7,621 $14,873 Supplies Equipment Supplies $51,124 $51,635 $52,151 $52,673 $53,199 $260,782 $508,907 Fuel Supplies $47,903 $48,382 $48,866 $49,354 $49,848 $244,352 $476,844 Other $5,027 $5,077 $5,128 $5,179 $5,231 $25,641 $50,038 Supplies $104,053 $105,094 $106,145 $107,206 $108,278 $530,775 $1,035,790 Sportsman's Fleet $194,961 $198,002 $201,101 $204,259 $207,477 $1,005,801 $1,936,903

General & Administrative Contractual Services $8,532 $8,618 $8,704 $8,791 $8,879 $43,523 $84,933 Building Maintenance Srv $6,817 $6,852 $6,715 $6,580 $6,449 $33,412 $65,881 Supplies $857 $866 $874 $883 $892 $4,371 $8,531 Total G&A $9,389 $9,483 $9,578 $9,674 $9,770 $47,894 $93,464

Total Expenses $1,585,813 $1,607,282 $1,600,797 $1,622,692 $1,645,106 $8,061,690 $15,300,347 Net Operating Income $661,123 $608,898 $585,324 $502,604 $421,912 $2,779,862 $3,949,417

Sirius Golf Advisors, LLC 414

Golf Operations Assessment Appendices Range Driving Range Minimal 2018 2019 2020 2021 2022 5 Year Revenue Range Buckets $263,577 $145,000 $295,000 $303,850 $335,000 $1,342,427 Rentals $1,019.72 $560.97 $1,141.29 $1,175.53 $1,296.04 $5,194 Other $8,825 $4,855 $9,877 $10,173 $11,216 $44,947 Total Revenue $273,422 $150,416 $306,018 $315,199 $347,512 $1,392,568 Expenses Salary and Wages $25,221 $25,726 $26,240 $26,765 $27,300 $131,252 Employee Benefits $0 $0 $0 $0 $0 $0 Supplies $30,909 $31,218 $31,530 $31,846 $32,164 $157,667 Other $1,308 $1,322 $1,335 $1,348 $1,362 $6,675 Total Expenses $56,130 $56,944 $57,770 $58,610 $59,464 $288,919 Net Operating Income $217,292 $93,472 $248,248 $256,589 $288,048 $1,103,649

Driving Range Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Range Buckets $341,700 $348,534 $355,505 $362,615 $369,867 $1,778,221 $3,120,648 Rentals $1,321.96 $1,348.40 $1,375.36 $1,402.87 $1,430.93 $6,880 $12,073 Other $11,441 $11,669.60 $11,902.99 $12,141.05 $12,383.87 $59,538 $104,485 Total Revenue $354,463 $361,552 $368,783 $376,159 $383,682 $1,844,638 $3,237,206 Expenses Salary and Wages $27,846 $28,403 $28,971 $29,551 $30,142 $144,912 $276,164 Employee Benefits $0 $0 $0 $0 $0 $0 $0 Supplies $32,486 $32,811 $33,139 $33,470 $33,805 $165,710 $323,377 Other $1,375 $1,389 $1,403 $1,417 $1,431 $7,015 $13,690 Total Expenses $60,332 $61,214 $62,110 $63,021 $63,946 $310,622 $599,541

Sirius Golf Advisors, LLC 415

Golf Operations Assessment Appendices Driving Range Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Net Operating Income $294,131 $300,338 $306,673 $313,138 $319,736 $1,534,016 $2,637,666

Academy Academy Minimal 2018 2019 2020 2021 2022 5 Year Revenue Group $225,788 $140,000 $232,415 $244,036 $242,816 $1,085,054 Private Lessons $158,051 $98,000 $162,691 $170,825 $169,971 $759,538 Total Revenue $383,839 $238,000 $395,106 $414,861 $412,786 $1,844,592 Cost of Sales $164,494 $101,995 $169,322 $177,789 $176,900 $790,500 Gross Profit $219,345 $136,005 $225,783 $237,072 $235,887 $1,054,092 Expenses Salary and Wages $23,539 $24,009 $24,490 $24,979 $25,479 $122,496 Employee Benefits $30,681 $31,602 $32,550 $33,526 $34,532 $162,891 Supplies $20,014 $20,414 $20,822 $21,239 $21,664 $104,153 Other $55,322 $56,428 $57,557 $58,708 $59,882 $287,897 Total Expenses $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Net Operating Income $89,790 $3,552 $90,365 $98,620 $94,330 $376,657

Academy Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Group $241,601 $240,393 $237,990 $235,610 $233,254 $1,188,848 $2,273,902 Private Lessons $169,121 $168,275 $166,593 $164,927 $163,277 $832,193 $1,591,731 Total Revenue $410,723 $408,669 $404,582 $400,536 $396,531 $2,021,041 $3,865,633

Sirius Golf Advisors, LLC 416

Golf Operations Assessment Appendices Academy Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Cost of Sales $176,015 $175,135 $173,384 $171,650 $169,933 $866,117 $1,656,617 Gross Profit $234,707 $233,534 $231,199 $228,887 $226,598 $1,154,924 $2,209,016 Expenses Salary and Wages $25,988 $26,508 $27,038 $27,579 $28,131 $135,245 $257,741 Employee Benefits $35,568 $36,635 $37,734 $38,866 $40,032 $188,835 $351,726 Supplies $22,097 $22,539 $22,990 $23,449 $23,918 $114,993 $219,146 Other $61,080 $62,301 $63,547 $64,818 $66,115 $317,861 $605,758 Total Expenses $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Net Operating Income $89,974 $85,551 $79,889 $74,174 $68,402 $397,990 $774,647

Sirius Golf Advisors, LLC 417

Golf Operations Assessment Appendices Anetsberger Anetsberger Minimal 2018 2019 2020 2021 2022 5 Year Rounds 11,462 11,519 11,577 11,635 11,693 57,885 Revenue Green Fees $77,447 $79,391 $81,384 $83,427 $85,521 $407,170 Tournament Fees $1,753 $1,797 $1,842 $1,888 $1,935 $9,214 Memberships $23,771 $24,368 $24,980 $25,607 $26,249 $124,975 Rentals $4,073 $4,175 $4,280 $4,387 $4,497 $21,411 Merchandise $18,262 $18,721 $19,191 $19,672 $20,166 $96,012 Total Revenue $125,306 $128,451 $131,676 $134,981 $138,369 $658,782 Cost of Sales $11,485 $11,773 $12,069 $12,372 $12,682 $60,381 Gross Profit $113,821 $116,678 $119,607 $122,609 $125,686 $598,401 Expenses Golf Operations Salary and Wages $33,593 $34,265 $34,951 $35,650 $36,363 $174,822 Contractual Services $2,318 $2,341 $2,365 $2,388 $2,412 $11,825 Repairs & Maint $1,297 $1,310 $1,323 $1,336 $1,349 $6,615 Supplies $1,726 $1,743 $1,760 $1,778 $1,796 $8,803 Total Operations $38,934 $39,659 $40,399 $41,152 $41,920 $202,065 Course Maintenance Salary and Wages $24,762 $25,258 $25,763 $26,278 $26,804 $128,865 Contractual Services $3,169 $3,233 $3,297 $3,363 $3,430 $16,493 Repairs & Maint $2,625 $2,677 $2,731 $2,786 $2,841 $13,660 Supplies $27,341 $27,888 $28,446 $29,015 $29,595 $142,285 Total Course Maintenance $57,898 $59,056 $60,237 $61,442 $62,671 $301,303 Total Expenses $96,832 $98,715 $100,636 $102,594 $104,591 $503,368 Net Operating Income $16,989 $17,963 $18,971 $20,015 $21,096 $95,033

Sirius Golf Advisors, LLC 418

Golf Operations Assessment Appendices Anetsberger Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Rounds 11,751 11,810 11,869 11,928 11,988 59,347 117,232 Revenue Green Fees $87,667 $89,868 $92,124 $94,436 $96,806 $460,901 $868,071 Tournament Fees $1,984 $2,034 $2,085 $2,137 $2,191 $10,430 $19,644 Memberships $26,908 $27,584 $28,276 $28,986 $29,713 $141,467 $266,442 Rentals $4,610 $4,726 $4,844 $4,966 $5,091 $24,236 $45,648 Merchandise $20,672 $21,191 $21,723 $22,268 $22,827 $108,681 $204,693 Total Revenue $141,842 $145,402 $149,051 $152,793 $156,628 $745,715 $1,404,498 Cost of Sales $13,001 $13,327 $13,661 $14,004 $14,356 $68,349 $128,731 Gross Profit $128,841 $132,075 $135,390 $138,788 $142,272 $677,366 $1,275,767 Expenses Golf Operations Salary and Wages $37,090 $37,832 $38,588 $39,360 $40,147 $193,017 $367,839 Contractual Services $2,436 $2,461 $2,485 $2,510 $2,535 $12,428 $24,253 Repairs & Maint $1,363 $1,377 $1,390 $1,404 $1,418 $6,952 $13,567 Supplies $1,814 $1,832 $1,850 $1,869 $1,887 $9,252 $18,055 Total Operations $42,703 $43,501 $44,314 $45,143 $45,988 $221,650 $423,714 Course Maintenance Salary and Wages $27,340 $27,887 $28,444 $29,013 $29,593 $142,277 $271,142 Contractual Services $3,499 $3,569 $3,640 $3,713 $3,787 $18,209 $34,702 Repairs & Maint $2,898 $2,956 $3,015 $3,076 $3,137 $15,082 $28,743 Supplies $30,187 $30,791 $31,407 $32,035 $32,675 $157,094 $299,380 Total Course Maintenance $63,924 $65,202 $66,507 $67,837 $69,193 $332,663 $633,966 Total Expenses $106,627 $108,703 $110,821 $112,980 $115,182 $554,313 $1,057,680 Net Operating Income $22,214 $23,371 $24,569 $25,808 $27,090 $123,053 $218,086

Sirius Golf Advisors, LLC 419

Golf Operations Assessment Appendices Division Division Expenses Minimal 2018 2019 2020 2021 2022 5 Year Buildings and Facilities Salary and Wages $47,829 $48,786 $49,761 $50,756 $51,772 $248,904 Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118 Contractual Services Building Maintenance Services $34,455 $34,799 $35,147 $35,499 $35,854 $175,754 Utilities $87,089 $87,959 $88,839 $89,727 $90,625 $444,239 Other $3,117 $3,148 $3,179 $3,211 $3,243 $15,897 CONTRACTUAL SERVICES $124,660 $125,906 $127,165 $128,437 $129,721 $635,890 Repairs & Maint Building Repairs $10,439 $10,543 $10,649 $10,755 $10,863 $53,249 Equipment Repairs $4,079 $4,119 $4,161 $4,202 $4,244 $20,805 REPAIR & MAINTENANCE $14,518 $14,663 $14,809 $14,957 $15,107 $74,054 Supplies Building Supplies $8,372 $8,456 $8,540 $8,625 $8,712 $42,705 Janitorial Supplies $5,424 $5,479 $5,533 $5,589 $5,645 $27,669 Other $11,601 $11,717 $11,835 $11,953 $12,073 $59,179 SUPPLIES $25,398 $25,652 $25,908 $26,167 $26,429 $129,553 Subtotal Building/Facility $234,652 $237,922 $241,247 $244,629 $248,069 $1,206,518 General & Administrative Salary and Wages $108,458 $110,627 $112,840 $115,097 $117,399 $564,420 Employee Benefits $28,090 $28,932 $29,800 $30,694 $31,615 $149,131 Contractual Services Bank Fees/Charges $61,328 $40,861 $48,385 $49,556 $68,792 $268,922 Advertising $25,000 $25,250 $25,503 $25,758 $26,015 $127,525 Printing $3,866 $3,905 $3,944 $3,983 $4,023 $19,721 Other $3,961 $4,001 $4,041 $4,081 $4,122 $20,205 Unemployment Reimbursement $80,118 $80,919 $81,729 $82,546 $83,371 $408,684

Sirius Golf Advisors, LLC 420

Golf Operations Assessment Appendices Division Expenses Minimal 2018 2019 2020 2021 2022 5 Year CONTRACTUAL SERVICES $174,274 $154,936 $163,600 $165,924 $186,324 $845,057 Administrative Charges FICA $80,977 $77,176 $78,720 $80,294 $89,034 $406,200 Medicare $18,938 $18,049 $18,410 $18,779 $20,822 $94,999 IMRF $111,818 $106,569 $108,700 $110,874 $122,942 $560,904 Life Insurance $719 $686 $699 $713 $791 $3,609 PDRMA portion (16%) $52,247 $49,795 $50,791 $51,807 $57,446 $262,086 Golf Conferences $8,200 $8,282 $8,365 $8,448 $8,533 $41,828 Software $4,921 $4,970 $5,020 $5,070 $5,120 $25,100 Administration Overhead $22,179 $34,473 $29,295 $24,015 $0 $109,963 DEPARTMENT TRANFERS $300,000 $300,000 $300,000 $300,000 $304,688 $1,504,688 Total G&A $610,821 $594,495 $606,240 $611,714 $640,026 $3,063,297 Total Expenses $845,473 $832,417 $847,487 $856,344 $888,095 $4,269,815

Division Expenses Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Buildings and Facilities Salary and Wages $52,807 $53,863 $54,940 $56,039 $57,160 $274,810 $523,713 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services Building Maintenance Services $36,212 $36,574 $36,940 $37,310 $37,683 $184,719 $360,473 Utilities $91,531 $92,446 $93,371 $94,304 $95,247 $466,900 $911,139 Other $3,275 $3,308 $3,341 $3,375 $3,408 $16,708 $32,606 CONTRACTUAL SERVICES $131,019 $132,329 $133,652 $134,989 $136,339 $668,327 $1,304,217 Repairs & Maint Building Repairs $10,971 $11,081 $11,192 $11,304 $11,417 $55,965 $109,213 Equipment Repairs $4,287 $4,330 $4,373 $4,417 $4,461 $21,867 $42,672 REPAIR & MAINTENANCE $15,258 $15,411 $15,565 $15,720 $15,878 $77,832 $151,886

Sirius Golf Advisors, LLC 421

Golf Operations Assessment Appendices Division Expenses Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Supplies Building Supplies $8,799 $8,887 $8,976 $9,065 $9,156 $44,883 $87,588 Janitorial Supplies $5,701 $5,758 $5,816 $5,874 $5,932 $29,081 $56,750 Other $12,193 $12,315 $12,438 $12,563 $12,688 $62,198 $121,377 SUPPLIES $26,693 $26,960 $27,230 $27,502 $27,777 $136,162 $265,715 Subtotal Building/Facility $251,568 $255,128 $258,749 $262,433 $266,182 $1,294,060 $2,500,579 General & Administrative Salary and Wages $119,746 $122,141 $124,584 $127,076 $129,617 $623,166 $1,187,586 Employee Benefits $32,563 $33,540 $34,547 $35,583 $36,650 $172,884 $322,015 Contractual Services Bank Fees/Charges $69,575 $69,141 $68,684 $67,619 $66,610 $341,630 $610,552 Advertising $26,275 $26,538 $26,803 $27,071 $27,342 $134,030 $261,555 Printing $4,063 $4,104 $4,145 $4,187 $4,228 $20,727 $40,449 Other $4,163 $4,205 $4,247 $4,289 $4,332 $21,235 $41,440 Unemployment Reimbursement $84,205 $85,047 $85,898 $86,757 $87,624 $429,531 $838,214 CONTRACTUAL SERVICES $188,282 $189,035 $189,777 $189,923 $190,137 $947,153 $1,792,210 Administrative Charges FICA $89,495 $90,707 $90,484 $91,716 $92,974 $455,376 $861,577 Medicare $20,930 $21,214 $21,162 $21,450 $21,744 $106,500 $201,499 IMRF $123,580 $125,253 $124,946 $126,647 $128,383 $628,809 $1,189,713 Life Insurance $795 $806 $804 $815 $826 $4,046 $7,654 PDRMA portion (16%) $57,743 $58,525 $58,382 $59,177 $59,988 $293,815 $555,900 Golf Conferences $8,618 $8,704 $8,792 $8,879 $8,968 $43,962 $85,790 Software $5,172 $5,223 $5,276 $5,328 $5,382 $26,380 $51,481 Administration Overhead $0 $0 $0 $0 $0 $0 $109,963 DEPARTMENT TRANFERS $306,334 $310,433 $309,844 $314,013 $318,264 $1,558,888 $3,063,576 Total G&A $646,926 $655,150 $658,752 $666,594 $674,669 $3,302,091 $6,365,387 Total Expenses $898,494 $910,278 $917,501 $929,028 $940,851 $4,596,151 $8,865,966

Sirius Golf Advisors, LLC 422

Golf Operations Assessment Appendices Composite

Composite Minimal 2018 2019 2020 2021 2022 5 Year Revenue SCC Golf $2,262,355 $1,503,324 $1,563,404 $1,589,285 $2,517,774 $9,436,141 Range $273,422 $150,416 $306,018 $315,199 $347,512 $1,392,568 Academy $383,839 $238,000 $395,106 $414,861 $412,786 $1,844,592 Miniature Golf $24,102 $24,584 $25,076 $25,578 $26,089 $125,430 Anetsberger $125,306 $128,451 $131,676 $134,981 $138,369 $658,782 Total Revenue $3,069,025 $2,044,775 $2,421,279 $2,479,903 $3,442,531 $13,457,513 Cost of Sales SCC Golf $257,838 $153,046 $159,229 $164,038 $293,778 $1,027,930 Academy $164,494 $101,995 $169,322 $177,789 $176,900 $790,500 Anetsberger $11,485 $11,773 $12,069 $12,372 $12,682 $60,381 Total COG $433,818 $266,814 $340,621 $354,198 $483,360 $1,878,811 Gross Profit $2,635,207 $1,777,961 $2,080,659 $2,125,705 $2,959,171 $11,578,702 Expenses SCC Golf $1,447,012 $1,377,765 $1,403,170 $1,429,184 $1,581,527 $7,238,657 Range $56,130 $56,944 $57,770 $58,610 $59,464 $288,919 Academy $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Anetsberger $96,832 $98,715 $100,636 $102,594 $104,591 $503,368 Other $7,208 $6,910 $6,861 $6,814 $6,652 $34,445 Division $845,473 $832,417 $847,487 $856,344 $888,095 $4,269,815 Total Expenses $2,582,211 $2,505,203 $2,551,343 $2,591,998 $2,781,885 $13,012,639 Net Operating Income $52,996 ($727,242) ($470,685) ($466,293) $177,286 ($1,433,937) Capital Allowance $280,000 $285,600 $291,312 $297,138 $303,081 $1,457,131 Debt Payment ($177,601) ($177,601) ($177,601) ($177,601) ($710,404) Cash Flow ($227,004) ($1,190,443) ($939,598) ($941,032) ($303,396) ($3,601,473)

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Golf Operations Assessment Appendices

Composite Minimal 2023 2024 2025 2026 2027 5 Year 10 Year Revenue SCC Golf $2,548,088 $2,517,212 $2,487,032 $2,426,087 $2,367,688 $12,346,107 $21,782,248 Range $354,463 $361,552 $368,783 $376,159 $383,682 $1,844,638 $3,237,206 Academy $410,723 $408,669 $404,582 $400,536 $396,531 $2,021,041 $3,865,633 Miniature Golf $26,611 $27,143 $27,686 $28,240 $28,805 $138,484 $263,914 Anetsberger $141,842 $145,402 $149,051 $152,793 $156,628 $745,715 $1,404,498 Total Revenue $3,481,726 $3,459,978 $3,437,135 $3,383,815 $3,333,333 $17,095,986 $30,553,500 Cost of Sales SCC Golf $301,152 $301,031 $300,911 $300,791 $300,670 $1,504,555 $2,532,485 Academy $176,015 $175,135 $173,384 $171,650 $169,933 $866,117 $1,656,617 Anetsberger $13,001 $13,327 $13,661 $14,004 $14,356 $68,349 $128,731 Total COG $490,168 $489,493 $487,956 $486,445 $484,960 $2,439,022 $4,317,833 Gross Profit $2,991,558 $2,970,485 $2,949,178 $2,897,370 $2,848,373 $14,656,964 $26,235,666 Expenses SCC Golf $1,585,813 $1,607,282 $1,600,797 $1,622,692 $1,645,106 $8,061,690 $15,300,347 Range $60,332 $61,214 $62,110 $63,021 $63,946 $310,622 $599,541 Academy $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Anetsberger $106,627 $108,703 $110,821 $112,980 $115,182 $554,313 $1,057,680 Other $6,607 $6,507 $6,356 $6,209 $6,067 $31,746 $66,192 Division $898,494 $910,278 $917,501 $929,028 $940,851 $4,596,151 $8,865,966 Total Expenses $2,802,605 $2,841,968 $2,848,893 $2,888,642 $2,929,348 $14,311,456 $27,324,095 Net Operating Income $188,953 $128,517 $100,285 $8,728 ($80,974) $345,509 ($1,088,429) Capital Allowance $309,143 $315,325 $321,632 $328,065 $334,626 $1,608,791 $3,065,922 Debt Payment ($177,601) ($177,601) ($177,601) ($177,601) ($177,601) ($888,005) ($1,598,410) Cash Flow ($297,791) ($364,409) ($398,948) ($496,938) ($593,201) ($2,151,287) ($5,752,760)

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Golf Operations Assessment Appendices

Scenario 2: Moderate Sportsman’s Golf Sportsman's Golf Moderate 2018 2019 2020 2021 2022 5 Year Rounds Classic 18 29,218 24,500 27,250 27,523 32,500 140,990 East 9 29,208 9,500 10,250 10,353 31,500 90,810 Total 58,426 34,000 37,500 37,875 64,000 231,801 Revenue Daily Fees Green Fees Classic 18 $974,012 $833,072 $945,112 $954,563 $1,172,285 $4,879,043 Green Fees East 9 $540,399 $179,283 $197,306 $199,279 $606,354 $1,722,620 Preferred Player Plan ($90,428) ($53,150) ($59,207) ($60,397) ($103,078) ($366,260) Daily Fees $1,423,983 $959,205 $1,083,210 $1,093,444 $1,675,561 $6,235,404 Program Fees Tournament Fees $31,305 $12,500 $12,750 $13,005 $36,000 $105,560 League Fees $40,428 $34,000 $34,680 $35,374 $44,000 $188,481 Program Fees $5,747 $5,979 $6,220 $6,408 $6,602 $30,955 Discount cards $19,786 $11,500 $11,965 $12,326 $24,750 $80,326 Program Fees $97,266 $63,979 $65,615 $67,113 $111,352 $405,324 Rentals Carts Classic 18 $241,535 $206,585 $234,368 $241,446 $303,875 $1,227,808 Carts East 9 $107,181 $35,558 $39,133 $40,315 $125,120 $347,307 Other Rentals $23,242 $13,796 $15,520 $15,989 $27,558 $96,104 Rentals $348,715 $242,143 $273,501 $281,761 $428,995 $1,575,115 Proshop Sales $336,648 $199,826 $224,804 $231,593 $399,166 $1,392,037 Food & Beverage Revenue

Gross Sales $438,193 $260,100 $292,613 $301,449 $519,567 $1,811,922

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Golf Operations Assessment Appendices Sportsman's Golf Moderate 2018 2019 2020 2021 2022 5 Year

NPD Share $43,819 $26,010 $29,261 $30,145 $51,957 $181,192

Miscellaneous & Winter $11,923 $12,161 $12,404 $12,653 $12,906 $62,047

Total Revenue $2,262,355 $1,503,324 $1,688,796 $1,716,708 $2,679,936 $9,851,118

Cost of Sales $257,838 $143,875 $161,859 $166,747 $287,399 $1,017,718

Gross Profit $2,004,516 $1,359,449 $1,526,937 $1,549,961 $2,392,537 $8,833,400

Expenses

Golf Operations

Salary and Wages $332,714 $265,000 $270,300 $275,706 $394,501 $1,538,222

Employee Benefits $43,881 $35,998 $37,820 $39,734 $58,560 $215,992

Contractual Services

$43,537 $32,000 $32,000 $32,000 $45,305 $184,842 $184,842

$23,946 $24,185 $24,427 $24,671 $24,918 $122,147 $122,147

$67,483 $56,185 $56,427 $56,671 $70,223 $306,989 $306,989

Supplies $36,158 $36,519 $36,885 $37,253 $37,626 $184,441

Total Golf Operations $480,235 $393,703 $401,432 $409,364 $560,910 $2,245,644

Course Maintenance

Salary and Wages $462,649 $471,902 $481,340 $490,967 $500,786 $2,407,645

Employee Benefits $49,862 $52,385 $55,036 $57,821 $60,746 $275,850

Contractual Services $29,329 $29,623 $29,919 $30,218 $30,520 $149,609

Grounds Repair $10,899 $11,008 $11,118 $11,230 $11,342 $55,597

Supplies

Grounds Supplies $158,437 $160,021 $161,621 $163,237 $164,870 $808,185

Planting Supplies $28,616 $28,902 $29,191 $29,483 $29,778 $145,971

Program Operating Supplies $15,850 $16,009 $16,169 $16,331 $16,494 $80,853

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Golf Operations Assessment Appendices Sportsman's Golf Moderate 2018 2019 2020 2021 2022 5 Year

Plumbing/Irrigation $13,018 $13,148 $13,279 $13,412 $13,546 $66,403

Other $8,611 $8,697 $8,784 $8,872 $8,961 $43,924

Supplies $224,532 $226,777 $229,045 $231,335 $233,648 $1,145,337

Total Course Maintenance $777,272 $791,695 $806,458 $821,570 $837,043 $4,034,038

Fleet Management

Salary and Wages $52,193 $53,237 $54,302 $55,388 $56,495 $271,615

Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118

Contractual Services $5,706 $5,763 $5,820 $5,878 $5,937 $29,104

Repair & Maintenance $1,422 $1,436 $1,450 $1,465 $1,479 $7,251

Supplies

Equipment Supplies $48,642 $49,129 $49,620 $50,116 $50,617 $248,125

Fuel Supplies $45,578 $46,034 $46,494 $46,959 $47,428 $232,492

Other $4,783 $4,831 $4,879 $4,928 $4,977 $24,397

Supplies $99,003 $99,993 $100,993 $102,003 $103,023 $505,014

Sportsman's Fleet $180,571 $183,344 $186,168 $189,045 $191,975 $931,102

General & Administrative

Contractual Services $8,118 $8,199 $8,281 $8,364 $8,448 $41,411

Building Maintenance Srv $6,060 $6,424 $6,552 $6,683 $6,750 $32,469

Supplies $815 $824 $832 $840 $848 $4,159

Total G&A $8,934 $9,023 $9,113 $9,204 $9,296 $45,570

Total Expenses $1,447,012 $1,377,765 $1,403,170 $1,429,184 $1,599,224 $7,256,355

Net Operating Income $557,505 ($18,316) $123,766 $120,777 $793,313 $1,577,045

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Golf Operations Assessment Appendices Sportsman's Golf Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Rounds Classic 18 32,825 33,153 33,485 33,820 34,158 167,440 308,431 East 9 31,658 31,816 31,975 32,135 32,295 159,878 250,689 Total 64,483 64,969 65,460 65,954 66,453 327,319 559,119 Revenue Daily Fees Green Fees Classic 18 $1,207,688 $1,244,160 $1,281,734 $1,320,442 $1,360,320 $6,414,344 $11,293,387 Green Fees East 9 $621,573 $637,175 $653,168 $669,562 $686,368 $3,267,846 $4,990,467 Preferred Player Plan ($104,893) ($106,742) ($108,623) ($110,539) ($112,488) ($543,286) ($909,545) Daily Fees $1,724,368 $1,774,593 $1,826,278 $1,879,466 $1,934,200 $9,138,905 $15,374,309 Program Fees Tournament Fees $36,720 $37,454 $38,203 $38,968 $39,747 $191,092 $296,653 League Fees $44,880 $45,778 $46,693 $47,627 $48,580 $233,557 $422,039 Program Fees $6,801 $7,006 $7,218 $7,436 $7,661 $36,122 $67,077 Discount cards $25,497 $26,267 $27,061 $27,878 $28,720 $135,424 $215,750 Program Fees $113,898 $116,506 $119,175 $121,909 $124,707 $596,195 $1,001,519 Rentals Carts Classic 18 $313,052 $322,506 $332,246 $342,280 $352,617 $1,662,700 $2,890,509 Carts East 9 $128,261 $131,480 $134,780 $138,163 $141,631 $674,317 $1,021,623 Other Rentals $28,321 $29,105 $29,912 $30,740 $31,592 $149,671 $245,775 Rentals $441,313 $453,987 $467,026 $480,443 $494,248 $2,337,017 $3,912,132 Proshop Sales $410,219 $421,580 $433,259 $445,264 $457,605 $2,167,926 $3,559,964 Food & Beverage Revenue Gross Sales $533,954 $548,743 $563,944 $579,570 $595,633 $2,821,845 $4,633,767 NPD Share $53,395 $54,874 $56,394 $57,957 $59,563 $282,184 $463,377 Miscellaneous & Winter $13,164 $13,164 $13,427 $13,696 $13,969 $14,249 $68,504 Total Revenue $2,756,357 $2,834,967 $2,915,829 $2,999,008 $3,084,571 $14,590,733 $24,441,851

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Golf Operations Assessment Appendices Sportsman's Golf Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Cost of Sales $295,357 $303,538 $311,946 $320,590 $329,475 $1,560,907 $2,578,625

Gross Profit $2,461,000 $2,531,429 $2,603,883 $2,678,418 $2,755,096 $13,029,826 $21,863,226

Expenses Golf Operations Salary and Wages $405,425 $416,654 $428,196 $440,061 $452,257 $2,142,592 $3,680,814 Employee Benefits $61,986 $65,614 $69,455 $73,521 $77,825 $348,402 $564,394 Contractual Services GPS $45,758 $46,215 $46,678 $47,144 $47,616 $233,411 $418,253 Other $25,167 $25,419 $25,673 $25,930 $26,189 $128,378 $250,526 Contractual Services $70,925 $71,634 $72,351 $73,074 $73,805 $361,789 $668,779 Supplies $38,002 $38,382 $38,766 $39,154 $39,545 $193,849 $378,291

Total Golf Operations $576,339 $592,285 $608,768 $625,810 $643,433 $3,046,633 $5,292,277

Course Maintenance Salary and Wages $490,771 $500,586 $490,574 $500,386 $510,393 $2,492,710 $4,900,355 Employee Benefits $61,317 $64,420 $65,026 $68,316 $71,773 $330,852 $606,702 Contractual Services $30,825 $31,134 $31,445 $31,760 $32,077 $157,241 $306,850 Grounds Repair $11,455 $11,570 $11,685 $11,802 $11,920 $58,433 $114,030 Supplies Grounds Supplies $161,572 $163,188 $159,924 $161,523 $163,139 $809,347 $1,617,532 Planting Supplies $29,183 $29,474 $28,885 $29,174 $29,465 $146,181 $292,152 Program Operating Supplies $16,659 $16,825 $16,994 $17,164 $17,335 $84,977 $165,829 Plumbing/Irrigation $13,682 $13,818 $13,957 $14,096 $14,237 $69,790 $136,193 Other $9,050 $9,141 $9,232 $9,324 $9,418 $46,165 $90,090 Supplies $230,146 $232,447 $228,992 $231,281 $233,594 $1,156,460 $2,301,797

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Golf Operations Assessment Appendices Sportsman's Golf Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Total Course Maintenance $824,514 $840,157 $827,722 $843,545 $859,758 $4,195,696 $8,229,734

Fleet Management Salary and Wages $57,625 $58,778 $59,953 $61,152 $62,376 $299,885 $571,499 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services $5,997 $6,057 $6,117 $6,178 $6,240 $30,589 $59,693 Repair & Maintenance $1,494 $1,509 $1,524 $1,539 $1,555 $7,621 $14,873 Supplies Equipment Supplies $51,124 $51,635 $52,151 $52,673 $53,199 $260,782 $508,907 Fuel Supplies $47,903 $48,382 $48,866 $49,354 $49,848 $244,352 $476,844 Other $5,027 $5,077 $5,128 $5,179 $5,231 $25,641 $50,038 Supplies $104,053 $105,094 $106,145 $107,206 $108,278 $530,775 $1,035,790 Sportsman's Fleet $194,961 $198,002 $201,101 $204,259 $207,477 $1,005,801 $1,936,903

General & Administrative Contractual Services $8,532 $8,618 $8,704 $8,791 $8,879 $43,523 $84,933 Building Maintenance Srv $6,817 $6,886 $6,954 $7,024 $7,094 $34,776 $67,245 Supplies $857 $866 $874 $883 $892 $4,371 $8,531 Total G&A $9,389 $9,483 $9,578 $9,674 $9,770 $47,894 $93,464

Total Expenses $1,605,203 $1,639,927 $1,647,169 $1,683,288 $1,720,438 $8,296,024 $15,552,379 Net Operating Income $855,797 $891,503 $956,714 $995,131 $1,034,658 $4,733,802 $6,310,847

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Golf Operations Assessment Appendices Range Driving Range Moderate 2018 2019 2020 2021 2022 5 Year Revenue Range Buckets $263,577 $145,000 $355,000 $358,550 $413,500 $1,535,627 Rentals $1,019.72 $560.97 $1,373.41 $1,387.15 $1,599.74 $5,941 Other $8,825 $4,855 $11,886 $12,005 $13,845 $51,416 Total Revenue $273,422 $150,416 $368,260 $371,942 $428,945 $1,592,984 Expenses Salary and Wages $25,221 $0 $26,500 $26,240 $26,765 $104,726 Employee Benefits $0 $0 $0 $0 $0 $0 Supplies $30,311 $16,675 $40,825 $41,233 $47,553 $176,597 Other $1,308 $0 $1,335 $1,348 $1,362 $5,353 Total Expenses $55,532 $16,675 $67,325 $67,473 $74,317 $281,323 Net Operating Income $217,890 $133,741 $300,935 $304,469 $354,627 $1,311,661 Driving Range Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Range Buckets $417,635 $421,811 $426,029 $430,290 $434,593 $2,130,358 $3,665,986 Rentals $1,615.73 $1,631.89 $1,648.21 $1,664.69 $1,681.34 $8,242 $14,183 Other $13,983 $14,123.06 $14,264.29 $14,406.94 $14,551.01 $71,329 $122,744 Total Revenue $433,234 $437,566 $441,942 $446,361 $450,825 $2,209,929 $3,802,913 Expenses Salary and Wages $27,846 $28,403 $28,971 $29,551 $30,142 $144,912 $249,638 Employee Benefits $0 $0 $0 $0 $0 $0 $0 Supplies $48,028 $48,508 $48,993 $49,483 $49,978 $244,991 $421,588 Other $1,375 $1,389 $1,403 $1,417 $1,431 $7,015 $12,368 Total Expenses $75,874 $76,911 $77,964 $79,034 $80,120 $389,903 $671,227 Net Operating Income $357,360 $360,655 $363,977 $367,328 $370,705 $1,820,025 $3,131,686

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Golf Operations Assessment Appendices

Academy Academy Moderate 2018 2019 2020 2021 2022 5 Year Revenue Group $245,000 $140,000 $275,000 $288,750 $294,525 $1,243,275 Private Lessons $171,500 $98,000 $192,500 $202,125 $206,168 $870,293 Total Revenue $416,500 $238,000 $467,500 $490,875 $500,693 $2,113,568 Cost of Sales $178,491 $107,100 $215,050 $230,711 $240,332 $971,685 Gross Profit $238,009 $130,900 $252,450 $260,164 $260,360 $1,141,883 Expenses Salary and Wages $23,539 $24,009 $24,490 $24,979 $25,479 $122,496 Employee Benefits $30,681 $31,602 $32,550 $33,526 $34,532 $162,891 Supplies $20,014 $20,414 $20,822 $21,239 $21,664 $104,153 Other $55,322 $56,428 $57,557 $58,708 $59,882 $287,897 Total Expenses $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Net Operating Income $108,454 ($1,553) $117,032 $121,712 $118,804 $464,447

Academy Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Group $300,416 $306,424 $312,552 $318,803 $325,179 $1,563,374 $2,806,649 Private Lessons $210,291 $214,497 $218,787 $223,162 $227,626 $1,094,362 $1,964,655 Total Revenue $510,706 $520,920 $531,339 $541,966 $552,805 $2,657,736 $4,771,304 Cost of Sales $245,139 $250,042 $255,043 $260,144 $265,346 $1,275,713 $2,247,398 Gross Profit $265,567 $270,879 $276,296 $281,822 $287,459 $1,382,023 $2,523,906 Expenses Salary and Wages $25,988 $26,508 $27,038 $27,579 $28,131 $135,245 $257,741 Employee Benefits $35,568 $36,635 $37,734 $38,866 $40,032 $188,835 $351,726

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Golf Operations Assessment Appendices Academy Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Supplies $22,097 $22,539 $22,990 $23,449 $23,918 $114,993 $219,146 Other $61,080 $62,301 $63,547 $64,818 $66,115 $317,861 $605,758 Total Expenses $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Net Operating Income $120,834 $122,895 $124,987 $127,109 $129,263 $625,089 $1,089,536

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Golf Operations Assessment Appendices Anetsberger Anetsberger Moderate 2018 2019 2020 2021 2022 5 Year Rounds 11,751 14,689 16,158 16,966 17,475 77,039 Revenue Green Fees $79,403 $101,239 $113,590 $121,655 $127,811 $543,698 Tournament Fees $1,797 $2,291 $2,570 $2,753 $2,892 $12,304 Memberships $24,372 $31,074 $34,865 $37,340 $39,230 $166,880 Rentals $4,175 $5,324 $5,973 $6,397 $6,721 $28,590 Merchandise $18,723 $58,756 $65,924 $70,605 $74,178 $288,186 Total Revenue $128,470 $198,683 $222,923 $238,750 $250,831 $1,039,658 Cost of Sales $11,775 $36,952 $41,460 $44,403 $46,650 $181,240 Gross Profit $116,695 $161,732 $181,463 $194,347 $204,181 $858,418 Expenses Golf Operations Salary and Wages $33,593 $34,265 $34,951 $35,650 $36,363 $174,822 Contractual Services $2,318 $2,341 $2,365 $2,388 $2,412 $11,825 Repairs & Maint $1,297 $1,310 $1,323 $1,336 $1,349 $6,615 Supplies $1,726 $1,743 $1,760 $1,778 $1,796 $8,803 Total Operations $38,934 $39,659 $40,399 $41,152 $41,920 $202,065 Course Maintenance Salary and Wages $24,762 $25,258 $32,500 $33,150 $33,813 $149,483 Contractual Services $3,169 $3,233 $3,297 $3,363 $3,430 $16,493 Repairs & Maint $2,625 $2,677 $2,731 $2,786 $2,841 $13,660 Supplies $27,341 $27,888 $31,000 $31,620 $32,252 $150,102 Total Course Maintenance $57,898 $59,056 $69,528 $70,919 $72,337 $329,738 Total Expenses $96,832 $98,715 $109,927 $112,071 $114,257 $531,803 Net Operating Income $19,863 $63,017 $71,536 $82,276 $89,924 $326,616

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Golf Operations Assessment Appendices Anetsberger Moderate 17,650 17,826 18,004 18,184 18,366 90,030 167,069 17,650 17,826 Rounds 17,650 17,826 18,004 18,184 18,366 90,030 167,069 Revenue

Green Fees $131,671 $135,647 $139,744 $143,964 $148,311 $699,336 $1,243,034

Tournament Fees $2,980 $3,070 $3,162 $3,258 $3,356 $15,826 $28,129

Memberships $40,414 $41,635 $42,892 $44,188 $45,522 $214,652 $381,532

Rentals $6,924 $7,133 $7,348 $7,570 $7,799 $36,775 $65,365

Merchandise $76,418 $78,726 $81,103 $83,552 $86,076 $405,875 $694,061

Total Revenue $258,406 $266,210 $274,250 $282,532 $291,065 $1,372,463 $2,412,121 Cost of Sales $48,059 $49,510 $51,006 $52,546 $54,133 $255,254 $436,494 Gross Profit $210,347 $216,700 $223,244 $229,986 $236,932 $1,117,209 $1,975,627

Expenses Golf Operations

Salary and Wages $45,101 $46,003 $46,923 $47,862 $48,819 $234,709 $409,531

Contractual Services $2,436 $2,461 $2,485 $2,510 $2,535 $12,428 $24,253

Repairs & Maint $1,363 $1,377 $1,390 $1,404 $1,418 $6,952 $13,567

Supplies $1,814 $1,832 $1,850 $1,869 $1,887 $9,252 $18,055

Total Operations $50,714 $51,673 $52,649 $53,645 $54,660 $263,342 $465,406

Course Maintenance

Salary and Wages $34,489 $35,179 $35,883 $36,600 $37,332 $179,483 $328,967

Contractual Services $3,499 $3,569 $3,640 $3,713 $3,787 $18,209 $34,702

Repairs & Maint $2,898 $2,956 $3,015 $3,076 $3,137 $15,082 $28,743

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Golf Operations Assessment Appendices Anetsberger Moderate 17,650 17,826 18,004 18,184 18,366 90,030 167,069 17,650 17,826 Supplies $32,897 $33,555 $34,227 $34,911 $35,609 $171,200 $321,301

Total Course Maintenance $73,784 $75,260 $76,765 $78,300 $79,866 $383,975 $713,713

Total Expenses $124,498 $126,932 $129,414 $131,945 $134,526 $647,316 $1,179,119

Net Operating Income $85,849 $89,768 $93,830 $98,041 $102,405 $469,893 $796,508

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Golf Operations Assessment Appendices Division Division Expenses Moderate 2018 2019 2020 2021 2022 5 Year Buildings and Facilities Salary and Wages $47,829 $48,786 $49,761 $50,756 $51,772 $248,904 Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118 Contractual Services Building Maintenance Services $34,455 $34,799 $35,147 $35,499 $35,854 $175,754 Utilities $87,089 $87,959 $88,839 $89,727 $90,625 $444,239 Other $3,117 $3,148 $3,179 $3,211 $3,243 $15,897 CONTRACTUAL SERVICES $124,660 $125,906 $127,165 $128,437 $129,721 $635,890 Repairs & Maint Building Repairs $10,439 $10,543 $10,649 $10,755 $10,863 $53,249 Equipment Repairs $4,079 $4,119 $4,161 $4,202 $4,244 $20,805 REPAIR & MAINTENANCE $14,518 $14,663 $14,809 $14,957 $15,107 $74,054 Supplies Building Supplies $8,372 $8,456 $8,540 $8,625 $8,712 $42,705 Janitorial Supplies $5,424 $5,479 $5,533 $5,589 $5,645 $27,669 Other $11,601 $11,717 $11,835 $11,953 $12,073 $59,179 SUPPLIES $25,398 $25,652 $25,908 $26,167 $26,429 $129,553 Subtotal Building/Facility $234,652 $237,922 $241,247 $244,629 $248,069 $1,206,518 General & Administrative Salary and Wages $108,458 $110,627 $112,840 $115,097 $117,399 $564,420 Employee Benefits $28,090 $28,932 $29,800 $30,694 $31,615 $149,131 Contractual Services Bank Fees/Charges $62,044 $42,264 $56,651 $58,154 $79,052 $298,166 Advertising $69,850 $79,702 $54,812 $72,498 $74,049 $350,912 Printing $3,866 $3,905 $3,944 $3,983 $4,023 $19,721 Other $3,961 $4,001 $4,041 $4,081 $4,122 $20,205 Unemployment Reimbursement $80,118 $80,919 $81,729 $82,546 $83,371 $408,684

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Golf Operations Assessment Appendices Division Expenses Moderate 2018 2019 2020 2021 2022 5 Year CONTRACTUAL SERVICES $219,840 $210,791 $201,177 $221,262 $244,617 $1,097,688 Administrative Charges FICA $80,977 $75,301 $79,230 $80,757 $90,629 $406,893 Medicare $18,938 $17,611 $18,530 $18,887 $21,196 $95,161 IMRF $111,818 $103,980 $109,405 $111,513 $125,145 $561,860 Life Insurance $719 $669 $704 $717 $805 $3,615 PDRMA portion (16%) $52,247 $48,585 $51,120 $52,105 $58,475 $262,532 Golf Conferences $8,200 $8,282 $8,365 $8,448 $8,533 $41,828 Software $4,921 $4,970 $5,020 $5,070 $5,120 $25,100 Administration Overhead $22,179 $40,603 $27,628 $22,503 $0 $112,913 DEPARTMENT TRANFERS $300,000 $300,000 $300,000 $300,000 $309,903 $1,509,903 Total G&A $656,388 $650,351 $643,817 $667,053 $703,533 $3,321,141 Total Expenses $891,039 $888,272 $885,064 $911,682 $951,602 $4,527,660

Division Expenses Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Buildings and Facilities Salary and Wages $52,807 $53,863 $54,940 $56,039 $57,160 $274,810 $523,713 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services Building Maintenance Services $36,212 $36,574 $36,940 $37,310 $37,683 $184,719 $360,473 Utilities $91,531 $92,446 $93,371 $94,304 $95,247 $466,900 $911,139 Other $3,275 $3,308 $3,341 $3,375 $3,408 $16,708 $32,606 CONTRACTUAL SERVICES $131,019 $132,329 $133,652 $134,989 $136,339 $668,327 $1,304,217 Repairs & Maint Building Repairs $10,971 $11,081 $11,192 $11,304 $11,417 $55,965 $109,213 Equipment Repairs $4,287 $4,330 $4,373 $4,417 $4,461 $21,867 $42,672 REPAIR & MAINTENANCE $15,258 $15,411 $15,565 $15,720 $15,878 $77,832 $151,886

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Golf Operations Assessment Appendices Division Expenses Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Supplies Building Supplies $8,799 $8,887 $8,976 $9,065 $9,156 $44,883 $87,588 Janitorial Supplies $5,701 $5,758 $5,816 $5,874 $5,932 $29,081 $56,750 Other $12,193 $12,315 $12,438 $12,563 $12,688 $62,198 $121,377 SUPPLIES $26,693 $26,960 $27,230 $27,502 $27,777 $136,162 $265,715 Subtotal Building/Facility $251,568 $255,128 $258,749 $262,433 $266,182 $1,294,060 $2,500,579 General & Administrative Salary and Wages $119,746 $122,141 $124,584 $127,076 $129,617 $623,166 $1,187,586 Employee Benefits $32,563 $33,540 $34,547 $35,583 $36,650 $172,884 $322,015 Contractual Services Bank Fees/Charges $81,055 $83,111 $85,223 $87,392 $89,619 $426,399 $724,565 Advertising $101,447 $104,028 $106,680 $109,403 $112,200 $533,758 $884,670 Printing $4,063 $4,104 $4,145 $4,187 $4,228 $20,727 $40,449 Other $4,163 $4,205 $4,247 $4,289 $4,332 $21,235 $41,440 Unemployment Reimbursement $84,205 $85,047 $85,898 $86,757 $87,624 $429,531 $838,214 CONTRACTUAL SERVICES $268,541 $274,028 $279,649 $285,406 $291,305 $1,398,928 $2,491,452 Administrative Charges FICA $91,826 $93,890 $94,542 $96,674 $98,855 $475,786 $882,679 Medicare $21,476 $21,958 $22,111 $22,609 $23,119 $111,273 $206,434 IMRF $126,798 $129,648 $130,549 $133,492 $136,504 $656,992 $1,218,852 Life Insurance $816 $834 $840 $859 $878 $4,227 $7,842 PDRMA portion (16%) $59,247 $60,579 $61,000 $62,375 $63,782 $306,984 $569,516 Golf Conferences $8,618 $8,704 $8,792 $8,879 $8,968 $43,962 $85,790 Software $5,172 $5,223 $5,276 $5,328 $5,382 $26,380 $51,481 Administration Overhead $0 $0 $0 $0 $0 $0 $112,913 DEPARTMENT TRANFERS $313,953 $320,838 $323,109 $330,217 $337,488 $1,625,605 $3,135,507 Total G&A $741,196 $757,014 $768,431 $784,903 $801,760 $3,853,305 $7,174,446 Total Expenses $992,764 $1,012,142 $1,027,181 $1,047,336 $1,067,942 $5,147,365 $9,675,025

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Composite Composite Moderate 2018 2019 2020 2021 2022 5 Year Revenue SCC Golf $2,262,355 $1,503,324 $1,688,796 $1,716,708 $2,679,936 $9,851,118 Range $273,422 $150,416 $368,260 $371,942 $428,945 $1,592,984 Academy $416,500 $238,000 $467,500 $490,875 $500,693 $2,113,568 Miniature Golf $24,102 $24,584 $87,500 $91,875 $95,550 $323,612 Anetsberger $128,470 $198,683 $222,923 $238,750 $250,831 $1,039,658 Total Revenue $3,104,850 $2,115,008 $2,834,978 $2,910,151 $3,955,955 $14,920,940 Cost of Sales SCC Golf $257,838 $143,875 $161,859 $166,747 $287,399 $1,017,718 Academy $178,491 $107,100 $215,050 $230,711 $240,332 $971,685 Anetsberger $11,775 $36,952 $41,460 $44,403 $46,650 $181,240 Total COG $448,104 $287,926 $418,369 $441,862 $574,382 $2,170,643 Gross Profit $2,656,745 $1,827,081 $2,416,609 $2,468,289 $3,381,573 $12,750,297 Expenses SCC Golf $1,447,012 $1,377,765 $1,403,170 $1,429,184 $1,599,224 $7,256,355 Range $55,532 $16,675 $67,325 $67,473 $74,317 $281,323 Academy $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Anetsberger $96,832 $98,715 $109,927 $112,071 $114,257 $531,803 Other $7,208 $6,910 $6,861 $6,814 $6,652 $34,445 Division $891,039 $888,272 $885,064 $911,682 $951,602 $4,527,660 Total Expenses $2,627,179 $2,520,791 $2,607,766 $2,665,676 $2,887,609 $13,309,021 Net Operating Income $29,566 ($693,709) ($191,157) ($197,387) $493,963 ($558,724) Capital Allowance $280,000 $285,600 $291,312 $297,138 $303,081 $1,457,131 Debt Payment ($681,242) ($681,242) ($681,242) ($681,242) ($2,724,968) Cash Flow ($250,434) ($1,660,551) ($1,163,711) ($1,175,767) ($490,360) ($4,740,824)

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Composite Moderate 2023 2024 2025 2026 2027 5 Year 10 Year Revenue SCC Golf $2,756,357 $2,834,967 $2,915,829 $2,999,008 $3,084,571 $14,590,733 $24,441,851 Range $433,234 $437,566 $441,942 $446,361 $450,825 $2,209,929 $3,802,913 Academy $510,706 $520,920 $531,339 $541,966 $552,805 $2,657,736 $4,771,304 Miniature Golf $97,461 $99,410 $101,398 $103,426 $105,495 $507,191 $830,803 Anetsberger $258,406 $266,210 $274,250 $282,532 $291,065 $1,372,463 $2,412,121 Total Revenue $4,056,165 $4,159,074 $4,264,758 $4,373,294 $4,484,761 $21,338,051 $36,258,992 Cost of Sales SCC Golf $295,357 $303,538 $311,946 $320,590 $329,475 $1,560,907 $2,578,625 Academy $245,139 $250,042 $255,043 $260,144 $265,346 $1,275,713 $2,247,398 Anetsberger $48,059 $49,510 $51,006 $52,546 $54,133 $255,254 $436,494 Total COG $588,555 $603,090 $617,995 $633,280 $648,955 $3,091,874 $5,262,517 Gross Profit $3,467,609 $3,555,984 $3,646,763 $3,740,014 $3,835,806 $18,246,177 $30,996,474 Expenses SCC Golf $1,605,203 $1,639,927 $1,647,169 $1,683,288 $1,720,438 $8,296,024 $15,552,379 Range $75,874 $76,911 $77,964 $79,034 $80,120 $389,903 $671,227 Academy $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Anetsberger $124,498 $126,932 $129,414 $131,945 $134,526 $647,316 $1,179,119 Other $6,607 $6,507 $6,356 $6,209 $6,067 $31,746 $66,192 Division $992,764 $1,012,142 $1,027,181 $1,047,336 $1,067,942 $5,147,365 $9,675,025 Total Expenses $2,949,680 $3,010,403 $3,039,393 $3,102,524 $3,167,289 $15,269,289 $28,578,311 Net Operating Income $517,930 $545,581 $607,370 $637,490 $668,517 $2,976,888 $2,418,164 Capital Allowance $309,143 $315,325 $321,632 $328,065 $334,626 $1,608,791 $3,065,922 Debt Payment ($681,242) ($681,242) ($681,242) ($681,242) ($681,242) ($3,406,210) ($6,131,179) Cash Flow ($472,455) ($450,986) ($395,504) ($371,817) ($347,351) ($2,038,113) ($6,778,937)

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Golf Operations Assessment Appendices Scenario 3: Major Sportsman’s Golf Sportsman's Golf Major 2018 2019 2020 2021 2022 5 Year Rounds Classic 18 30,350 24,500 28,350 28,917 35,125 147,242 East 9 29,570 9,500 11,150 11,373 33,000 94,593 Total 59,920 34,000 39,500 40,290 68,125 241,835 Revenue Daily Fees Green Fees Classic 18 $1,011,754 $833,072 $1,020,600 $1,055,471 $1,405,000 $5,325,896 Green Fees East 9 $547,100 $179,283 $214,630 $218,923 $693,000 $1,852,935 Preferred Player Plan ($92,741) ($53,150) ($62,365) ($64,248) ($109,721) ($382,225) Daily Fees $1,466,113 $959,205 $1,172,865 $1,210,145 $1,988,279 $6,796,607 Program Fees Tournament Fees $31,305 $12,500 $12,750 $13,005 $61,000 $130,560 League Fees $40,428 $34,000 $34,680 $35,374 $45,000 $189,481 Program Fees $5,747 $5,979 $6,220 $6,472 $8,000 $32,417 Discount cards $19,786 $11,500 $11,965 $12,448 $26,500 $82,199 Program Fees $97,266 $63,979 $65,615 $67,298 $140,500 $434,657 Rentals Carts Classic 18 $250,894 $196,189 $231,559 $240,914 $386,375 $1,305,932 Carts East 9 $108,510 $36,830 $44,092 $45,873 $151,800 $387,104 Other Rentals $23,836 $13,796 $16,348 $17,008 $29,334 $100,322 Rentals $359,404 $233,020 $275,651 $286,787 $538,175 $1,693,036 Proshop Sales $345,259 $199,826 $236,794 $246,360 $579,063 $1,607,301 Food & Beverage Revenue Gross Sales from golf $449,400 $260,100 $308,219 $320,671 $715,313 $2,053,702 Gross Sales from restaurant $0 $0 $0 $0 $765,000 $765,000

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Golf Operations Assessment Appendices Sportsman's Golf Major 2018 2019 2020 2021 2022 5 Year Gross Sales from banquet $0 $0 $0 $0 $1,500,000 $1,500,000 Total Gross Sales $449,400 $260,100 $308,219 $320,671 $2,980,313 $4,318,702 NPD Share $44,940 $26,010 $30,822 $32,067 $298,031 $431,870 Simulator $0 $0 $0 $0 $45,000 $45,000 Miscellaneous & Winter $11,923 $12,161 $12,404 $12,653 $20,000 $69,141 Total Revenue $2,324,903 $1,494,201 $1,794,151 $1,855,310 $3,609,047 $11,077,612

Cost of Sales $264,433 $141,876 $168,124 $174,916 $411,134 $1,160,483

Gross Profit $2,060,470 $1,352,324 $1,626,028 $1,680,394 $3,197,913 $9,917,130

Expenses Golf Operations Salary and Wages $341,224 $265,000 $270,300 $275,706 $419,928 $1,572,158 Employee Benefits $45,003 $35,998 $37,820 $39,734 $62,334 $220,889 Contractual Services GPS $43,537 $32,000 $32,000 $32,000 $45,305 $184,842 Other $23,946 $24,185 $24,427 $24,671 $24,918 $122,147 Contractual Services $67,483 $56,185 $56,427 $56,671 $70,223 $306,989 Supplies $36,158 $36,519 $36,885 $37,253 $37,626 $184,441

Total Golf Operations $489,867 $393,703 $401,432 $409,364 $590,111 $2,284,477

Course Maintenance Salary and Wages $462,649 $471,902 $481,340 $490,967 $535,000 $2,441,858 Employee Benefits $49,862 $52,385 $55,036 $57,821 $64,897 $280,001 Contractual Services $29,329 $29,623 $29,919 $30,218 $35,000 $154,089 Grounds Repair $10,899 $11,008 $11,118 $11,230 $15,000 $59,255

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Golf Operations Assessment Appendices Sportsman's Golf Major 2018 2019 2020 2021 2022 5 Year Supplies Grounds Supplies $158,437 $160,021 $161,621 $163,237 $185,000 $828,316 Planting Supplies $28,616 $28,902 $29,191 $29,483 $35,000 $151,193 Program Operating Supplies $15,850 $16,009 $16,169 $16,331 $25,000 $89,359 Plumbing/Irrigation $13,018 $13,148 $13,279 $13,412 $10,000 $62,857 Other $8,611 $8,697 $8,784 $8,872 $8,961 $43,924 Supplies $224,532 $226,777 $229,045 $231,335 $263,961 $1,175,649 Total Course Maintenance $777,272 $791,695 $806,458 $821,570 $913,857 $4,110,852

Fleet Management Salary and Wages $52,193 $53,237 $54,302 $55,388 $56,495 $271,615 Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118 Contractual Services $5,706 $5,763 $5,820 $5,878 $5,937 $29,104 Repair & Maintenance $1,422 $1,436 $1,450 $1,465 $1,479 $7,251 Supplies Equipment Supplies $48,642 $49,129 $49,620 $50,116 $50,617 $248,125 Fuel Supplies $45,578 $46,034 $46,494 $46,959 $47,428 $232,492 Other $4,783 $4,831 $4,879 $4,928 $4,977 $24,397 Supplies $99,003 $99,993 $100,993 $102,003 $103,023 $505,014 Sportsman's Fleet $180,571 $183,344 $186,168 $189,045 $191,975 $931,102

General & Administrative Contractual Services $8,118 $8,199 $8,281 $8,364 $8,448 $41,411 Building Maintenance Srv $6,060 $6,424 $6,552 $6,683 $12,000 $37,719 Supplies $815 $824 $832 $840 $848 $4,159 Total G&A $8,934 $9,023 $9,113 $9,204 $9,296 $45,570

Total Expenses $1,456,644 $1,377,765 $1,403,170 $1,429,184 $1,705,239 $7,372,002 Net Operating Income $603,827 ($25,441) $222,857 $251,211 $1,492,674 $2,545,128

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Sportsman's Golf 2023 2024 2025 2026 2027 5 Year 10 Year Rounds Classic 18 35,828 36,186 36,548 36,913 37,282 182,756 329,998 East 9 33,165 33,331 33,497 33,665 33,833 167,492 262,085 Total 68,993 69,517 70,045 70,578 71,116 350,248 592,083 Revenue Daily Fees Green Fees Classic 18 $1,476,093 $1,535,580 $1,597,463 $1,645,707 $1,695,407 $7,950,250 $13,276,146 Green Fees East 9 $717,359 $742,574 $768,676 $787,969 $807,747 $3,824,325 $5,677,261 Preferred Player Plan ($112,230) ($114,213) ($116,232) ($118,288) ($120,381) ($581,344) ($963,569) Daily Fees $2,081,222 $2,163,940 $2,249,907 $2,315,388 $2,382,774 $11,193,231 $17,989,838 Program Fees Tournament Fees $62,220 $63,464 $64,734 $66,028 $67,349 $323,795 $454,356 League Fees $45,900 $46,818 $47,754 $48,709 $49,684 $238,865 $428,347 Program Fees $8,323 $8,575 $8,834 $9,100 $9,375 $44,207 $76,624 Discount cards $27,571 $28,403 $29,261 $30,145 $31,055 $146,435 $228,633 Program Fees $144,014 $147,260 $150,583 $153,983 $157,463 $753,302 $1,187,959 Rentals Carts Classic 18 $401,985 $414,124 $426,631 $439,515 $452,789 $2,135,044 $3,440,976 Carts East 9 $155,610 $159,516 $163,520 $167,624 $171,832 $818,102 $1,205,206 Other Rentals $30,302 $31,143 $32,007 $32,895 $33,809 $160,156 $260,478 Rentals $557,595 $573,640 $590,151 $607,139 $624,620 $2,953,146 $4,646,182 Proshop Sales $598,165 $614,763 $631,826 $649,366 $667,397 $3,161,517 $4,768,817 Food & Beverage Revenue Gross Sales from golf $738,910 $759,413 $780,491 $802,158 $824,432 $3,905,403 $5,959,104 Gross Sales from restaurant $787,950 $811,589 $835,936 $861,014 $886,845 $4,183,334 $4,948,334 Gross Sales from banquet $1,545,000 $1,591,350 $1,639,091 $1,688,263 $1,738,911 $8,202,615 $9,702,615 Total Gross Sales $3,071,860 $3,162,352 $3,255,517 $3,351,435 $3,450,187 $16,291,351 $20,610,053

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Golf Operations Assessment Appendices Sportsman's Golf 2023 2024 2025 2026 2027 5 Year 10 Year NPD Share $307,186 $316,235 $325,552 $335,144 $345,019 $1,629,135 $2,061,005 Simulator $46,350 $47,741 $49,173 $50,648 $52,167 $246,078 $291,078 Miscellaneous & Winter $20,400 $20,808 $21,224 $21,649 $22,082 $106,162 $175,303 Total Revenue $3,754,932 $3,884,388 $4,018,414 $4,133,316 $4,251,522 $20,042,572 $31,120,184

Cost of Sales $424,697 $436,482 $448,596 $461,050 $473,852 $2,244,677 $3,405,160

Gross Profit $3,330,234 $3,447,906 $3,569,818 $3,672,267 $3,777,670 $17,797,895 $27,715,025

Expenses Golf Operations Salary and Wages $433,781 $445,818 $458,191 $470,911 $483,987 $2,292,688 $3,864,846 Employee Benefits $66,322 $70,207 $74,320 $78,675 $83,285 $372,810 $593,698 Contractual Services GPS $45,758 $46,215 $46,678 $47,144 $47,616 $233,411 $418,253 Other $25,167 $25,419 $25,673 $25,930 $26,189 $128,378 $250,526 Contractual Services $70,925 $71,634 $72,351 $73,074 $73,805 $361,789 $668,779 Supplies $38,002 $38,382 $38,766 $39,154 $39,545 $193,849 $378,291

Total Golf Operations $609,030 $626,041 $643,628 $661,814 $680,623 $3,221,136 $5,505,613

Course Maintenance Salary and Wages $545,700 $556,614 $567,746 $579,101 $590,683 $2,839,845 $5,281,703 Employee Benefits $68,180 $71,630 $75,255 $79,063 $83,063 $377,191 $657,192 Contractual Services $35,350 $35,704 $36,061 $36,421 $36,785 $180,321 $334,410 Grounds Repair $15,150 $15,302 $15,455 $15,609 $15,765 $77,280 $136,536 Supplies Grounds Supplies $180,000 $181,800 $178,164 $179,946 $181,745 $901,655 $1,729,971 Planting Supplies $34,300 $34,643 $33,950 $34,290 $34,633 $171,815 $323,008

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Golf Operations Assessment Appendices Sportsman's Golf 2023 2024 2025 2026 2027 5 Year 10 Year Program Operating Supplies $25,250 $25,503 $25,758 $26,015 $26,275 $128,800 $218,159 Plumbing/Irrigation $10,100 $10,201 $10,303 $10,406 $10,510 $51,520 $114,377 Other $9,050 $9,141 $9,232 $9,324 $9,418 $46,165 $90,090 Supplies $258,700 $261,287 $257,407 $259,981 $262,581 $1,299,956 $2,475,604 Total Course Maintenance $923,081 $940,536 $951,923 $970,175 $988,878 $4,774,593 $8,885,445

Fleet Management Salary and Wages $57,625 $58,778 $59,953 $61,152 $62,376 $299,885 $571,499 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services $5,997 $6,057 $6,117 $6,178 $6,240 $30,589 $59,693 Repair & Maintenance $1,494 $1,509 $1,524 $1,539 $1,555 $7,621 $14,873 Supplies Equipment Supplies $51,124 $51,635 $52,151 $52,673 $53,199 $260,782 $508,907 Fuel Supplies $47,903 $48,382 $48,866 $49,354 $49,848 $244,352 $476,844 Other $5,027 $5,077 $5,128 $5,179 $5,231 $25,641 $50,038 Supplies $104,053 $105,094 $106,145 $107,206 $108,278 $530,775 $1,035,790 Sportsman's Fleet $194,961 $198,002 $201,101 $204,259 $207,477 $1,005,801 $1,936,903

General & Administrative Contractual Services $8,532 $8,618 $8,704 $8,791 $8,879 $43,523 $84,933 Building Maintenance Srv $12,120 $12,362 $12,486 $12,611 $12,737 $62,316 $100,035 Supplies $857 $866 $874 $883 $892 $4,371 $8,531 Total G&A $9,389 $9,483 $9,578 $9,674 $9,770 $47,894 $93,464

Total Expenses $1,736,461 $1,774,063 $1,806,231 $1,845,922 $1,886,748 $9,049,424 $16,421,425 Net Operating Income $1,593,774 $1,673,843 $1,763,588 $1,826,345 $1,890,922 $8,748,471 $11,293,599

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Range Driving Range Major 2018 2019 2020 2021 2022 5 Year Revenue Range Buckets $285,000 $0 $395,000 $426,600 $447,930 $1,554,530 Rentals $1,102.60 $0.00 $1,528.16 $1,650.42 $1,732.94 $6,014 Other $9,542 $0 $13,225 $14,283 $14,998 $52,049 Total Revenue $295,645 $0 $409,754 $442,534 $464,661 $1,612,593 Expenses Salary and Wages $25,221 $0 $0 $0 $0 $25,221 Employee Benefits $0 $0 $0 $0 $0 $0 Supplies $28,500 $0 $39,500 $42,660 $44,793 $155,453 Other $1,308 $0 $0 $0 $0 $1,308 Total Expenses $53,721 $0 $39,500 $42,660 $44,793 $180,674 Net Operating Income $241,924 $0 $370,254 $399,874 $419,868 $1,431,919

Driving Range Major 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Range Buckets $470,327 $479,733 $489,328 $494,221 $499,163 $2,432,771 $3,987,301 Rentals $1,819.58 $1,855.98 $1,893.10 $1,912.03 $1,931.15 $9,412 $15,426 Other $15,747 $16,062.39 $16,383.64 $16,547.48 $16,712.95 $81,454 $133,503 Total Revenue $487,894 $497,651 $507,604 $512,680 $517,807 $2,523,637 $4,136,230 Expenses Salary and Wages $0 $0 $0 $0 $0 $0 $25,221 Employee Benefits $0 $0 $0 $0 $0 $0 $0 Supplies $47,033 $47,973 $48,933 $49,422 $49,916 $243,277 $398,730 Other $0 $0 $0 $0 $0 $0 $1,308

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Golf Operations Assessment Appendices Total Expenses $47,033 $47,973 $48,933 $49,422 $49,916 $243,277 $423,951 Net Operating Income $440,861 $449,678 $458,672 $463,258 $467,891 $2,280,360 $3,712,279 Academy Academy Major Revenue Group $245,000 $140,000 $325,000 $341,250 $375,000 $1,426,250 Private Lessons $171,500 $98,000 $227,500 $238,875 $262,500 $998,375 Total Revenue $416,500 $238,000 $552,500 $580,125 $637,500 $2,424,625 Cost of Sales $178,491 $107,100 $254,150 $272,659 $306,000 $1,118,400 Gross Profit $238,009 $130,900 $298,350 $307,466 $331,500 $1,306,225 Expenses Salary and Wages $23,539 $24,009 $24,490 $24,979 $25,479 $122,496 Employee Benefits $30,681 $31,602 $32,550 $33,526 $34,532 $162,891 Supplies $20,014 $20,414 $20,822 $21,239 $21,664 $104,153 Other $55,322 $56,428 $57,557 $58,708 $59,882 $287,897 Total Expenses $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Net Operating Income $108,454 ($1,553) $162,932 $169,014 $189,943 $628,790

Academy Major 2023 2024 2025 2026 2027 5 Year 10 Year Revenue Group $382,500 $390,150 $397,953 $405,912 $414,030 $1,990,545 $3,416,795 Private Lessons $267,750 $273,105 $278,567 $284,138 $289,821 $1,393,382 $2,391,757 Total Revenue $650,250 $663,255 $676,520 $690,051 $703,852 $3,383,927 $5,808,552 Cost of Sales $312,120 $318,362 $324,730 $331,224 $337,849 $1,624,285 $2,742,685 Gross Profit $338,130 $344,893 $351,790 $358,826 $366,003 $1,759,642 $3,065,867 Expenses Salary and Wages $25,988 $26,508 $27,038 $27,579 $28,131 $135,245 $257,741

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Golf Operations Assessment Appendices Academy Major 2023 2024 2025 2026 2027 5 Year 10 Year Employee Benefits $35,568 $36,635 $37,734 $38,866 $40,032 $188,835 $351,726 Supplies $22,097 $22,539 $22,990 $23,449 $23,918 $114,993 $219,146 Other $61,080 $62,301 $63,547 $64,818 $66,115 $317,861 $605,758 Total Expenses $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Net Operating Income $193,397 $196,909 $200,481 $204,113 $207,807 $1,002,708 $1,631,497 $756,934

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Golf Operations Assessment Appendices Anetsberger Anetsberger Major 2018 2019 2020 2021 2022 5 Year Rounds 11,751 14,689 16,158 16,966 17,475 77,039 Revenue Green Fees $79,403 $101,239 $113,590 $121,655 $127,811 $543,698 Tournament Fees $1,797 $2,291 $2,570 $2,753 $2,892 $12,304 Memberships $24,372 $31,074 $34,865 $37,340 $39,230 $166,880 Rentals $4,175 $5,324 $5,973 $6,397 $6,721 $28,590 Merchandise $18,723 $58,756 $65,924 $70,605 $74,178 $288,186 Total Revenue $128,470 $198,683 $222,923 $238,750 $250,831 $1,039,658 Cost of Sales $11,775 $36,952 $41,460 $44,403 $46,650 $181,240 Gross Profit $116,695 $161,732 $181,463 $194,347 $204,181 $858,418 Expenses Golf Operations Salary and Wages $33,593 $34,265 $42,500 $43,350 $44,217 $197,926 Contractual Services $2,318 $2,341 $2,365 $2,388 $2,412 $11,825 Repairs & Maint $1,297 $1,310 $1,323 $1,336 $1,349 $6,615 Supplies $1,726 $1,743 $1,760 $1,778 $1,796 $8,803 Total Operations $38,934 $39,659 $47,948 $48,853 $49,775 $225,169 Course Maintenance Salary and Wages $24,762 $25,258 $32,500 $33,150 $33,813 $149,483 Contractual Services $3,169 $3,233 $3,297 $3,363 $3,430 $16,493 Repairs & Maint $2,625 $2,677 $2,731 $2,786 $2,841 $13,660 Supplies $27,341 $27,888 $31,000 $31,620 $32,252 $150,102 Total Course Maintenance $57,898 $59,056 $69,528 $70,919 $72,337 $329,738 Total Expenses $96,832 $98,715 $117,476 $119,771 $122,112 $554,907 Net Operating Income $19,863 $63,017 $63,987 $74,576 $82,069 $303,512

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Golf Operations Assessment Appendices Anetsberger Major 2023 2024 2025 2026 2027 5 Year 10 Year Rounds 17,650 17,826 18,004 18,184 18,366 90,030 167,069 Revenue

Green Fees $131,671 $135,647 $139,744 $143,964 $148,311 $699,336 $1,243,034

Tournament Fees $2,980 $3,070 $3,162 $3,258 $3,356 $15,826 $28,129

Memberships $40,414 $41,635 $42,892 $44,188 $45,522 $214,652 $381,532

Rentals $6,924 $7,133 $7,348 $7,570 $7,799 $36,775 $65,365

Merchandise $76,418 $78,726 $81,103 $83,552 $86,076 $405,875 $694,061

Total Revenue $258,406 $266,210 $274,250 $282,532 $291,065 $1,372,463 $2,412,121 Cost of Sales $48,059 $49,510 $51,006 $52,546 $54,133 $255,254 $436,494 Gross Profit $210,347 $216,700 $223,244 $229,986 $236,932 $1,117,209 $1,975,627

Expenses Golf Operations

Salary and Wages $45,101 $46,003 $46,923 $47,862 $48,819 $234,709 $432,635

Contractual Services $2,436 $2,461 $2,485 $2,510 $2,535 $12,428 $24,253

Repairs & Maint $1,363 $1,377 $1,390 $1,404 $1,418 $6,952 $13,567

Supplies $1,814 $1,832 $1,850 $1,869 $1,887 $9,252 $18,055

Total Operations $50,714 $51,673 $52,649 $53,645 $54,660 $263,342 $488,510

Course Maintenance

Salary and Wages $34,489 $35,179 $35,883 $36,600 $37,332 $179,483 $328,967

Contractual Services $3,499 $3,569 $3,640 $3,713 $3,787 $18,209 $34,702

Repairs & Maint $2,898 $2,956 $3,015 $3,076 $3,137 $15,082 $28,743

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Golf Operations Assessment Appendices Anetsberger Major 2023 2024 2025 2026 2027 5 Year 10 Year Supplies $32,897 $33,555 $34,227 $34,911 $35,609 $171,200 $321,301

Total Course Maintenance $73,784 $75,260 $76,765 $78,300 $79,866 $383,975 $713,713

Total Expenses $124,498 $126,932 $129,414 $131,945 $134,526 $647,316 $1,202,223

Net Operating Income $85,849 $89,768 $93,830 $98,041 $102,405 $469,893 $773,404

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Golf Operations Assessment Appendices Division Division Expenses Major 2018 2019 2020 2021 2022 5 Year Buildings and Facilities Salary and Wages $47,829 $48,786 $49,761 $50,756 $51,772 $248,904 Employee Benefits $22,248 $22,915 $23,603 $24,311 $25,040 $118,118 Contractual Services Building Maintenance Services $34,455 $34,799 $35,147 $35,499 $50,000 $189,900 Utilities $87,089 $87,959 $88,839 $89,727 $140,000 $493,614 Other $3,117 $3,148 $3,179 $3,211 $5,000 $17,654 CONTRACTUAL SERVICES $124,660 $125,906 $127,165 $128,437 $195,000 $701,169 Repairs & Maint Building Repairs $10,439 $10,543 $10,649 $10,755 $13,000 $55,386 Equipment Repairs $4,079 $4,119 $4,161 $4,202 $4,244 $20,805 REPAIR & MAINTENANCE $14,518 $14,663 $14,809 $14,957 $17,244 $76,191 Supplies Building Supplies $8,372 $8,456 $8,540 $8,625 $12,000 $45,993 Janitorial Supplies $5,424 $5,479 $5,533 $5,589 $9,000 $31,025 Other $11,601 $11,717 $11,835 $11,953 $12,073 $59,179 SUPPLIES $25,398 $25,652 $25,908 $26,167 $33,073 $136,197 Subtotal Building/Facility $234,652 $237,922 $241,247 $244,629 $322,129 $1,280,578 General & Administrative Salary and Wages $108,458 $110,627 $112,840 $115,097 $117,399 $564,420 Employee Benefits $28,090 $28,932 $29,800 $30,694 $31,615 $149,131 Contractual Services Bank Fees/Charges $63,738 $39,076 $61,285 $64,117 $101,066 $329,283 Advertising $69,850 $80,158 $49,675 $72,448 $100,000 $345,145 Printing $3,866 $3,905 $3,944 $3,983 $5,500 $21,198 Other $3,961 $4,001 $4,041 $4,081 $6,000 $22,083 Unemployment Reimbursement $80,118 $80,919 $81,729 $82,546 $83,371 $408,684

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Golf Operations Assessment Appendices Division Expenses Major 2018 2019 2020 2021 2022 5 Year CONTRACTUAL SERVICES $221,534 $209,949 $201,084 $232,820 $295,937 $1,126,392 Administrative Charges FICA $81,597 $75,301 $77,848 $79,405 $93,597 $407,749 Medicare $19,083 $17,611 $18,207 $18,571 $21,890 $95,361 IMRF $112,674 $103,980 $107,497 $109,647 $129,245 $563,043 Life Insurance $725 $669 $692 $705 $832 $3,622 PDRMA portion (16%) $52,648 $48,585 $50,229 $51,233 $60,390 $263,085 Golf Conferences $8,200 $8,282 $8,365 $8,448 $8,533 $41,828 Software $4,921 $4,970 $5,020 $5,070 $5,120 $25,100 Administration Overhead $20,152 $40,603 $32,143 $26,920 $0 $119,818 DEPARTMENT TRANFERS $300,000 $300,000 $300,000 $300,000 $319,607 $1,519,607 Total G&A $658,082 $649,508 $643,724 $678,611 $764,558 $3,394,483 Total Expenses $892,733 $887,430 $884,971 $923,240 $1,086,687 $4,675,061

Division Expenses Major 2023 2024 2025 2026 2027 5 Year 10 Year Buildings and Facilities Salary and Wages $52,807 $53,863 $54,940 $56,039 $57,160 $274,810 $523,713 Employee Benefits $25,792 $26,565 $27,362 $28,183 $29,029 $136,931 $255,048 Contractual Services Building Maintenance Services $50,500 $51,005 $51,515 $52,030 $52,551 $257,601 $447,501 Utilities $141,400 $142,814 $144,242 $145,685 $147,141 $721,282 $1,214,896 Other $5,050 $5,101 $5,152 $5,203 $5,255 $25,760 $43,414 CONTRACTUAL SERVICES $196,950 $198,920 $200,909 $202,918 $204,947 $1,004,643 $1,705,812 Repairs & Maint Building Repairs $13,130 $13,261 $13,394 $13,528 $13,663 $66,976 $122,362 Equipment Repairs $4,287 $4,330 $4,373 $4,417 $4,461 $21,867 $42,672 REPAIR & MAINTENANCE $17,417 $17,591 $17,767 $17,945 $18,124 $88,843 $165,034

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Golf Operations Assessment Appendices Division Expenses Major 2023 2024 2025 2026 2027 5 Year 10 Year Supplies Building Supplies $12,120 $12,241 $12,364 $12,487 $12,612 $61,824 $107,817 Janitorial Supplies $9,090 $9,181 $9,273 $9,365 $9,459 $46,368 $77,393 Other $12,193 $12,315 $12,438 $12,563 $12,688 $62,198 $121,377 SUPPLIES $33,403 $33,737 $34,075 $34,415 $34,760 $170,390 $306,587 Subtotal Building/Facility $326,369 $330,676 $335,053 $339,500 $344,019 $1,675,617 $2,956,195 General & Administrative Salary and Wages $119,746 $122,141 $124,584 $127,076 $129,617 $623,166 $1,187,586 Employee Benefits $32,563 $33,540 $34,547 $35,583 $36,650 $172,884 $322,015 Contractual Services Bank Fees/Charges $104,852 $108,088 $111,429 $114,303 $117,254 $555,925 $885,208 Advertising $105,762 $109,930 $113,415 $117,017 $120,038 $566,162 $911,307 Printing $5,555 $5,611 $5,667 $5,723 $5,781 $28,336 $49,534 Other $6,060 $6,121 $6,182 $6,244 $6,306 $30,912 $52,995 Unemployment Reimbursement $84,205 $85,047 $85,898 $86,757 $87,624 $429,531 $838,214 CONTRACTUAL SERVICES $308,017 $316,420 $324,291 $331,823 $338,844 $1,619,394 $2,745,786 Administrative Charges FICA $95,867 $98,029 $100,242 $102,506 $104,823 $501,467 $909,216 Medicare $22,421 $22,926 $23,444 $23,973 $24,515 $117,279 $212,640 IMRF $132,378 $135,364 $138,420 $141,546 $144,745 $692,453 $1,255,496 Life Insurance $852 $871 $891 $911 $931 $4,455 $8,078 PDRMA portion (16%) $61,855 $63,250 $64,677 $66,138 $67,633 $323,553 $586,638 Golf Conferences $8,618 $8,704 $8,792 $8,879 $8,968 $43,962 $85,790 Software $5,172 $5,223 $5,276 $5,328 $5,382 $26,380 $51,481 Administration Overhead $0 $0 $0 $0 $0 $0 $119,818 DEPARTMENT TRANFERS $327,162 $334,368 $341,740 $349,282 $356,997 $1,709,549 $3,229,156 Total G&A $787,489 $806,470 $825,162 $843,763 $862,108 $4,124,992 $7,519,475 Total Expenses $1,113,857 $1,137,146 $1,160,215 $1,183,263 $1,206,127 $5,800,608 $10,475,669

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Golf Operations Assessment Appendices

Composite Composite Major 2018 2019 2020 2021 2022 5 Year Revenue SCC Golf $2,324,903 $1,494,201 $1,794,151 $1,855,310 $3,609,047 $11,077,612 Range $295,645 $0 $409,754 $442,534 $464,661 $1,612,593 Academy $416,500 $238,000 $552,500 $580,125 $637,500 $2,424,625 Miniature Golf $24,102 $24,584 $87,500 $91,875 $95,550 $323,612 Anetsberger $128,470 $198,683 $222,923 $238,750 $250,831 $1,039,658 Total Revenue $3,189,621 $1,955,468 $3,066,828 $3,208,594 $5,057,589 $16,478,100 Cost of Sales SCC Golf $264,433 $141,876 $168,124 $174,916 $411,134 $1,160,483 Academy $178,491 $107,100 $254,150 $272,659 $306,000 $1,118,400 Anetsberger $11,775 $36,952 $41,460 $44,403 $46,650 $181,240 Total COG $454,699 $285,928 $463,733 $491,978 $763,785 $2,460,123 Gross Profit $2,734,922 $1,669,540 $2,603,094 $2,716,616 $4,293,804 $14,017,978 Expenses SCC Golf $1,456,644 $1,377,765 $1,403,170 $1,429,184 $1,705,239 $7,372,002 Range $53,721 $0 $39,500 $42,660 $44,793 $180,674 Academy $129,555 $132,453 $135,418 $138,452 $141,557 $677,436 Anetsberger $96,832 $98,715 $117,476 $119,771 $122,112 $554,907 Other $7,208 $6,910 $6,861 $6,814 $6,652 $34,445 Division $892,733 $887,430 $884,971 $923,240 $1,086,687 $4,675,061 Total Expenses $2,636,694 $2,503,273 $2,587,397 $2,660,121 $3,107,039 $13,494,524 Net Operating Income $98,228 ($833,732) $15,697 $56,495 $1,186,765 $523,453 Capital Allowance $280,000 $285,600 $291,312 $297,138 $303,081 $1,457,131 Debt Payment ($1,450,914) ($1,450,914) ($1,450,914) ($1,450,914) ($5,803,656) Cash Flow ($181,772) ($2,570,246) ($1,726,529) ($1,691,557) ($567,230) ($6,737,334)

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Golf Operations Assessment Appendices

Composite Major 2023 2024 2025 2026 2027 5 Year 10 Year Revenue SCC Golf $3,754,932 $3,884,388 $4,018,414 $4,133,316 $4,251,522 $20,042,572 $31,120,184 Range $487,894 $497,651 $507,604 $512,680 $517,807 $2,523,637 $4,136,230 Academy $650,250 $663,255 $676,520 $690,051 $703,852 $3,383,927 $5,808,552 Miniature Golf $95,550 $97,461 $99,410 $101,398 $103,426 $507,191 $830,803 Anetsberger $258,406 $266,210 $274,250 $282,532 $291,065 $1,372,463 $2,412,121 Total Revenue $5,247,031 $5,408,965 $5,576,199 $5,719,978 $5,867,671 $27,829,790 $44,307,890 Cost of Sales SCC Golf $424,697 $436,482 $448,596 $461,050 $473,852 $2,244,677 $3,405,160 Academy $312,120 $318,362 $324,730 $331,224 $337,849 $1,624,285 $2,742,685 Anetsberger $48,059 $49,510 $51,006 $52,546 $54,133 $255,254 $436,494 Total COG $784,876 $804,355 $824,332 $844,820 $865,833 $4,124,216 $6,584,338 Gross Profit $4,462,155 $4,604,611 $4,751,867 $4,875,158 $5,001,838 $23,705,574 $37,723,552 Expenses SCC Golf $1,736,461 $1,774,063 $1,806,231 $1,845,922 $1,886,748 $9,049,424 $16,421,425 Range $47,033 $47,973 $48,933 $49,422 $49,916 $243,277 $423,951 Academy $144,733 $147,983 $151,309 $154,713 $158,196 $756,934 $1,434,370 Anetsberger $124,498 $126,932 $129,414 $131,945 $134,526 $647,316 $1,202,223 Other $6,607 $6,507 $6,356 $6,209 $6,067 $31,746 $66,192 Division $1,113,857 $1,137,146 $1,160,215 $1,183,263 $1,206,127 $5,800,608 $10,475,669 Total Expenses $3,173,189 $3,240,605 $3,302,457 $3,371,474 $3,441,581 $16,529,306 $30,023,830 Net Operating Income $1,288,966 $1,364,006 $1,449,410 $1,503,684 $1,560,257 $7,176,268 $7,699,722 Capital Allowance $309,143 $315,325 $321,632 $328,065 $334,626 $1,608,791 $3,065,922 Debt Payment ($1,450,914) ($1,450,914) ($1,450,914) ($1,450,914) ($1,450,914) ($7,254,570) ($13,058,226) Cash Flow ($471,090) ($402,234) ($323,136) ($275,295) ($225,283) ($1,697,037) ($8,434,371)

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