PRIVATE CLUBS

1
PRIVATE CLUBS

• Four Major Categories
• Country Club
• City Club
• City Athletic Club
• Yacht Club

2
Country Club

• Usually refers to a club in the suburbs with
• Clubhouse
• Golf Course(s)
• Tennis courts
• Swimming pool(s)
• Other recreational activities
• Recent 5 year trend .. To have a fitness and
  health center

3
City Club

• Is typically a dining club located in the city
• May be in a free-standing building by itself or
  in an office building, etc.
• Main dining room, meeting rooms, lounge, and
  maybe a ball room.
• Very formal service and upscale menus for
  business entertainment.

4
City Athletic Club

• Is the same as a city club, but with athletic
  amenities such as
• Tennis courts (indoor and outdoor)
• Swimming pool
• Fitness/athletic area including weights aerobic
  equipment
• Racquetball, squash, basketball, etc.
• Workout/aerobic class area
• Locker rooms with full amenities

5
Yacht Club

• Same as country or city-athletic club, but with
  marine activities and usually no golf.
• Located on body of water
• Powerboat or sailboat docking
• Marina services

6
What is the purpose of a private club?

• It is a specific place where one may associate
  with ones peers or those with similar interests
  athletic, social, industrial, intellectual, etc.
• It is a selected group of people who gather in a
  specified place for social and recreational needs
  that are provided through professional management.

7
Why do people join private clubs?

• Networking for business contacts
• Social status
• Fine dining
• Athletic facilities

8
Two underlying reasons always exist

• To be recognized
• To have fun

9
Characteristics of a Private Club

• Club has an established, stable clientele
• Deal with the same customers day after day, week
  after week, year after year.
• Fixed clientele requires that menus be changed
  more frequently than restaurants, and there are a
  variety of holiday celebrations.
• Inventory in the pro shop must be turned over
  regularly.

10
Characteristics of a Private Club

• Privilege of using club facilities is obtained
  through payment of dues.
• Therefore, food must be outstanding or better
  than fine dining restaurants for city clubs and
  be priced competitively or lower than 4 star
  restaurant quality.
• The FB operation is subsidized in part by the
  dues.
• Expectations at a 4 star restaurant include
  table cloths, linen napkins, special china, fresh
  flowers, better than average service, immaculate
  grounds, and a unique menu.

11
Characteristics of a Private Club

• A Club Manager is expected to know a variety of
  things in club management
• FB operations for fine dining
• Cost controls
• Membership relationship
• Board of Directors politics
• Golf course agronomy and operations
• Tennis programming and maintenance
• Swimming pool safety and sanitation

12
Club Ownership Types

• Member owned (equity)
• The members own the assets, they have rights to
  the clubs equity, like shareholders.
• Governed by a board of directors (typically 10 to
  12), but some are as low as 4 and as large as 50
  directors.
• A membership has one vote on issues that are
  mandated by the clubs bylaws.

13
Club Ownership Types

• Member owned (equity) - cont.
• Depending on the states legal climate for
  ownership in a business, some clubs issue a bond
  to members and those with bonds can vote or
  redeem it for a set value.
• Most of the old established clubs are of this
  format.
• In order to maintain a clubs tax exemption, the
  IRS measures whether a club is a true private
  club by seeing if it allows non-members to use
  the facility by paying an admission fee.

14
Club Ownership Types

• Proprietary (for profit)
• Owned by an individual, partnership or
  corporation.
• Members have no equity interest or actual control
  over its operation.
• Developer built clubs and CCA clubs are examples
  of this type.
• These clubs pay income tax and dont have
  abatements or lower rates on local taxes such as
  property tax.
• Some developer clubs revert to member owned when
  a certain number of homes are sold (e.g. 75)