(Photo by Jim Tiller/The Daytona Beach News-Journal)

After a deal fell through in July to have Consolidated-Tomoka Land Co. sell the Daytona Beach, Fla. property that includes the LPGA Golf Club to CBIGG, the Chinese-backed management firm, Virginia-based Fore Golf emerged as the new buyer from a group of eight qualified bidders. Fore Golf now has “big plans” for injecting a large amount of capital into the courses, for everything from a new fleet of golf carts to bunker projects.

The pair of golf courses at LPGA International in Daytona Beach, Fla. have a new owner, to start a new chapter for the popular courses that have bled money for decades, The Daytona Beach News-Journal reported.

Manassas, Va.-based Fore Golf Partners completed its $3.45 million purchase of the two 18-hole courses on October 17, The News-Journal reported, acquiring the 657-acre property from Daytona Beach-based Consolidated-Tomoka Land Co.

In announcing the deal, Consolidated-Tomoka also said it paid off its remaining liability to the city of $540,000, The News-Journal reported. That payment covered the per-round surcharge the company agreed to pay the city in connection with its prior buyout of the land lease with the city.

In turn, Fore Golf agreed to pay Consolidated-Tomoka $560,000 in the future, based on a per-round surcharge of $1.50 for each round of golf played at LPGA Golf Club, The News-Journal reported.

“We’re pleased to have completed the sale of the golf operations, which has sustained significant operating losses throughout the history of the Golf Club and required substantial capital expenditures in recent years,” said Consolidated-Tomoka CEO John Albright.

“We’re glad to transition the golf courses to an experienced operator,” added Albright, whose company owns income-producing commercial real estate properties in multiple states. “[Operating golf courses] is not our core business.”

The sale included the Clubhouse at LPGA International, which includes the Malcolm’s Bar & Grill restaurant, as well as a golf pro shop, The News-Journal reported.

LPGA Golf Club employs approximately 125 full-and part-time employees, The News-Journal reported. “The bulk of the jobs are going to stay with the new owner,” Albright said, adding that there may be changes in senior management positions at the golf club.

Not included in the sale is the headquarters for the Ladies Professional Golf Association, which owns its building at LPGA International, Albright confirmed.

Fore Golf owns 11 golf clubs in Florida and Maryland, The News-Journal reported, and has owned and managed more than 100 private clubs, daily-fee golf courses and resorts over the past 38 years.

Charles Staples, a Jupiter, Fla. resident who leads Fore Golf as its chairman and CEO, has dedicated more than 38 years of his 56 years in the golf business to acquiring, repositioning, developing and operating all types of golf facilities throughout the United States, The News-Journal reported.

Staples has led the acquisition, development and operation of over 100 golf facilities, The News-Journal reported. He began his golf career in 1960 and became a Class A member of the PGA of America in 1967. He has served the Middle Atlantic PGA as vice president, secretary, treasurer and tournament chairman.

One of the courses he developed and managed, Kinloch Golf Club in Virginia, received top rankings from Golf Digest and Golf World. Staples has lectured for the PGA of America on golf course acquisition and management, and in the 1980s he was commissioned to write the PGA book, “Buying or Leasing a Golf Course.”

Since the 1960s, The News-Journal reported, he has been a teaching professional, director of golf, head professional and greens superintendent at golf courses in Pennsylvania, Virginia, Florida and Ohio.

“No one has more experience than [Staples],” said Steve Ekovich, a Tampa, Fla.-based commercial real estate broker with Marcus & Millichap, which represented Consolidated-Tomoka in the sale. Ekovich is the National Director of Marcus & Millichap’s Leisure Investment Properties Group.

Fore Golf “has big plans” for injecting a large amount of capital into the LPGA courses, bringing everything from a new fleet of golf carts to repairs to sand traps, Ekovich told The News-Journal. While he’s been a part of 150 golf course sales throughout the country, Ekovich added, he’s never seen a company undertake such a detailed inspection of a property as Fore Golf did for this acquisition .

Fore Golf has specialized in challenging turnarounds, The News-Journal reported, and the company’s website says the principals have never been involved in a deal that didn’t work financially and have never given a club back to its lender.

A mission statement on the website said the company invests in deferred maintenance, improves communication between on-site staff and players, and elevates operational standards to improve the experience of players.

“I think members [of the LPGA Golf Club] are in for an exciting experience,” said Ekovich.

The sale to Fore Golf, The News-Journal reported, came out of Consolidated-Tomoka’s determination to quickly regroup after a nearly completed sale to another golf course management company, CBIGG, fell through at the end of July (https://clubandresortbusiness.com/lpga-international-course-sale-stalled-by-daytona-fla-city-commission/).

CBIGG had a binding contract to buy the two LPGA courses for $3.45 million, The News-Journal reported. That was more than double the $1.5 million Consolidated-Tomoka paid the city in early 2017 to acquire the courses along with a three-hole practice course, two-sided driving range, clubhouse, pool and fitness facility.

But the sale was worth more than $1.5 million to the city, The News-Journal reported, because Consolidated-Tomoka gave the city about 30 acres of land around Daytona Beach’s Municipal Stadium. And Consolidated also made improvements to the LPGA golf courses, including spending $300,000 in the summer of 2017 to replace the greens at the Jones golf course, the primary tournament course at LPGA International.

Consolidated-Tomoka also committed to pay the city a $1 surcharge for every round of golf played, which could have reached $700,000 if the company had retained ownership of the golf courses for 10 years, The News-Journal reported. The company has so far paid the city $140,000 in annual per-round surcharge fees. Fore Golf will be responsible for the remaining $560,000, which can be paid out over eight years in increments of $70,000 annually.

 

 

But two days before Consolidated was set to close with CBIGG, the company’s vice president of operations said he was walking away from the deal, The News-Journal reported.

At their July 17 meeting, city commissioners were slated to vote on changes to a 1990 master agreement for the sprawling LPGA golf course property, The News-Journal reported. The amendments included setting up surcharge payments to the city and solidifying privileges of the Ladies Professional Golf Association to use the facility.

There was also a measure ensuring re-use water would be available at the city’s standard non-residential rates, The News-Journal reported, and it was nothing that appeared to have the power to scuttle the sale.

But during the meeting the mayor and commissioners grew leery of CBIGG, the acronym for a Chinese conglomerate, C-Bons International Golf Group Inc. The discussion grew tense and it became clear the deal with the U.S. subsidiary of the Chinese company was in trouble, The News-Journal reported.

At that point, The News-Journal reported, Consolidated-Tomoka had toiled for five months to lock in a buyer, only to have it break down at the last minute. But by early September, it was already moving again toward closing a sale of the LPGA courses with Fore Golf.

Fore Golf steered clear of the changes CBIGG tried to get city commissioners to approve, and was able to complete the deal without having to publicly seek commissioners’ approval during a meeting or get the blessing of city staff, Ekovich told The News-Journal.

Consolidated-Tomoka had eight potential buyers who were all qualified, Ekovich told The News-Journal, but Fore Golf rose to the top because it was prepared to close the deal most quickly. A group of local investors that included auto dealer Randy Dye offered significantly less money than the seven other prospects, but they would have been next on the list if things with Fore Golf hadn’t worked out, Ekovich added.

Dye, the managing partner of Daytona Dodge Chrysler Jeep Ram who is also chairman of the Daytona Regional Chamber of Commerce as well as a member at LPGA Golf Club, told The News-Journal that while his group was disappointed to not make the acquisition, “We welcome [the new owners] with open arms.

“Fore Golf, it’s their core business,” Dye said. “They’re professionals and they’ve already identified areas that need improvement, such as the sand trap.

“We’re hopeful that the new owners will understand the value of the golf club to the community,” he added. “They said they want to improve communications and that, in and of itself, is a big plus.”