The city council was asked to approve a transfer of $205,000 from the city’s “undesignated fund balance” to cover the costs of the club’s operation through June 30. Golf Facilities Management, which has run the club since 2010, is paying the city less under a new contract, and invested $300,000 in new equipment to maintain the golf course even while it was shut down for six weeks. But Chris Carter of the management firm says the 110-year-old club is still “very viable,” with a business boost anticipated from a planned $5 million investment for major renovations to its clubhouse, which is on the National Register of Historic Places.
The city-owned Beverly (Mass.) Golf and Tennis Club is expected to come up $205,000 short in revenues this fiscal year due in part to the coronavirus pandemic, The Salem (Mass.) News reported.
Mayor Mike Cahill informed the Beverly City Council of the shortfall in a letter and asked councilors to approve a transfer of $205,000 from the city’s “undesignated fund balance” to cover the costs of the club’s operation through June 30, The News reported.
The pandemic forced the club to shut down for much of the spring, Cahill said in the letter, and he also noted that the new contract to manage the club pays the city less than expected, The News reported.
In an interview with The News, Chris Carter of Golf Facilities Management, which runs the club, said this is a difficult time for many golf courses, which were already facing a flattening of revenues.
“It’s been a challenge,” Carter said. “This is obviously new territory for everybody.”
Beverly Golf and Tennis shut down for six weeks due to the pandemic before being allowed to reopen on May 7, Carter said. But restrictions on the number of golfers has meant the club has been operating at only about 60 percent of capacity, he added, with tee times 15 minutes apart instead of the usual eight or nine minutes.
“It’s working, but we can’t put as many golfers on the course as we normally do,” Carter said.
The club has also been unable to hold functions in its historic clubhouse, which includes two function rooms and a pub, The News reported. And its 10 outdoor clay tennis courts did not open until the second half of June.
Golf Facilities Management has been managing the club since 2010, The News reported.. Its first contract expired last year, and the company was the only bidder when the city rebid the contract In the fall of 2019.
Under the new five-year contract, Golf Facilities Management is paying the city $380,000 per year, less than the $420,000 it paid in 2019, The News reported.
Total revenues at the club were $1.2 million last year, down more than $400,000 from 2016, The News reported. Overall revenue has been “flat” for the last 10 years, Carter said.
“The golf industry in general has been flat,” he said. “It’s definitely not as high as we had hoped for, and expenses keeping going through the roof.”
The increase in the minimum wage has been one of the biggest costs for the club, Carter told The News. The minimum wage was $8 per hour when the company first began to run the club, but it is now $12.75 and scheduled to go up to $15 in 2023.
Golf Facilities Management also recently bought $300,000 worth of equipment, Carter said. Even when there was no golf, “We still have to maintain the property,” he noted.
But despite the tough times, Carter said the city-owned operation remains “very viable,” The News reported. The city is planning to spend $5 million on the property, including major renovations to the clubhouse, which was built in 1910 and is on the National Register of Historic Places. The club was founded by the United Shoe Machinery Corporation.
“The city has been great to work with,” Carter said. “We’re going to work through this, no doubt about it.”