A special committee tasked with assessing the economic prospects of city-owned golf course and driving range The Lakes at El Segundo, told the City Council Tuesday night that the facility possesses unusual financial value.
Craig Kessler, director of governmental affairs for the Southern California Golf Association and one (a member) of the city’s temporary Golf Course Advisory Group, said generally speaking 9-hole executive golf courses with a driving range lack much in the way of market value.
“That is a profile of a course that is not generally going to make money off a management agreement and not generally will you find a company willing to assume the risk and pay you for the operation of the course,” Kessler said. “This one is the exception…for whatever set of reasons, this golf course does have value in the market.”
The group, as part of its determination, contacted seven golf course management firms, including two of the largest in the nation, Billy Casper Golf and the American Golf Corporation, as well as current operator Lane Donovan Golf Partners. All seven showed interest in managing the property, according to Kessler. The group’s report found that the facility’s current net revenue of $275,000 could realistically be expected to increase to $400,000 to $500,000 annually under a revised management agreement.
The Lakes at El Segundo has been at the center of a controversy surrounding a proposal by Texas-based TopGolf, who hopes to install its patented, high-tech reinvention of the traditional driving range into the Southern California market through a $15 million reconfiguration of the El Segundo driving range. TopGolf uses microchip-embedded balls and field sensors to make a driving range into a game that tracks every shot a golfer makes. Additionally, TopGolf facilities include a social component, with as many as six players able to play together while being served food and drinks in a high-end lounge-style environment. A similar sized TopGolf facility in Allen, Texas, is expected to generate $38 million in local revenues over ten years.
But local golfers who use the existing facility have organized opposition to the TopGolf proposal. On Tuesday, many were present, filling the council chambers.
“You should take great pride in the fact there is so much support for this golf course,” Kessler told the council.
Councilman Dave Atkinson noted at the outset of the meeting that the Advisory Group was not tasked with analyzing the TopGolf proposal.
“This has nothing to do with TopGolf at this point,” said Atkinson, who was the council’s representative on the Advisory Group. “I don’t know how many of you had a speech about TopGolf…It’s not the meeting for that.”
The TopGolf proposal nonetheless drew fire.
El Segundo resident Lew Murez, one of the more vocal opponents of the TopGolf proposal locally, said the group’s report provided a good argument for keeping The Lakes as a “normative” golf facility. He also praised the council for forming the advisory group.
“I know it’s a very difficult decision,” Murez said. “I would just hope we would not overreact, not panic. There are monetary, as well as non-monetary factors. And I would hope we would take the time to balance them.”
Chuck Shriner, a Manhattan Beach resident and golfer who frequents The Lakes, said he was at the course this afternoon and witnessed teenage girls practicing alongside other community members. He questioned if such a scene would be possible under a TopGolf scenario.
“It doesn’t seem like it to me,” he said. “We have a jewel here. The culture here is always wholesome. It’s good. It’s a place where – you just have to see a snapshot of all the people on the green on a sunny, beautiful spring day. I wouldn’t tear that down…The value of what that is now is just irreplaceable.”
Josh Alpert, an El Segundo resident and operator of a junior golf academy at The Lakes, asked the council to deeply consider the facility’s role in the community.
“I just respectfully hope as you guys continue on with this difficult decision, it’s a balance of the life we live here in El Segundo and the financial considerations – and hope you take both into your considerations,” he said.
Councilwoman Marie Fellhauer, whose recommendation it was to found the Advisory Group, said she fully understood the “value of the gem we have” to the community.
“I get it,” she said. “I do. This [report] really helps us.”
