8.1 SR 03-01-2021Request for Action
To
Item Number
Mayor and Ci T Council
8.1
Agenda Section
Meeting Date
Prepared by
General Business
March 1, 2021
Cal Portner, City Administrator
Item Description
Reviewed by
Pinewood Golf Course Proposals
Peter Beck, City Attorney
Reviewed by
Action Requested
Direct, by motion, staff to develop a purchase agreement and necessary actions to prepare for the sale of
Pinewood Golf Course with
Background/Discussion
On February 1, 2021, the City Council considered the sale of Pinewood Golf Course. After hearing resident
testimony and the Council directed staff to prepare a request for proposals (RFP). The Council reviewed the RFP
on February 16 and directed staff to post.
Two complete proposals were received before the deadline.
Financial Impact
N/A
Mission/Policy/Goal
The Elk River Vision and Mission.
Attachments
Pinewood Proposal — Elk River Golf Club
Pinewood Proposal — Jennifer Abrahamson, Trevor Birdsall, and Adrienne Thompson
• Pinewood Request for Proposals
The Elk River Vision
A welcoming community with revolutionary and spirited resourcefulness, exceptional
service, and community engagement that encourages and inspires pi ospei ly.
M
TUREJ
Updated.• August 2020
Elk River
Golf Club
20015 Elk Lake Rd p. 763-441-4111 Ringer71 `,gmail.com
Elk River, MN 55330 Elkrivergc.com
Pinewood Golf
Course
Proposal for purchase
Table of Contents
I. Section 1
Firm Experience and Background
Past Performance
Benefits of This Proposal
Capacity Finance Acquisition
II. Section 2 Purchase Terms
Time Frame
Type of Purchase
Purchase Proposal
Finances
III. Appendix
Profit and Loss Statement
Land Map Attached
Maintenance Equipment Inventory
Section 1
Firm Experience and Background
The Elk River Golf Club has operated an 18-hole golf course for 61
years, along with operating Pinewood Golf Course for the last 4
years (2 years under a management agreement & 2 years under a
lease agreement, both with the City of Elk River).
The Management staff at Elk River Golf Club has a total of 61 years
of experience, giving them the great knowledge and golf business
background to continue to manage & improve Pinewood for
decades to come. The General Manager, Chris Singer has 23 years
of experience in the golf business with 14 years of that as the
General Manager at Elk River Golf Club. The Superintendent at Elk
River Golf Club, Jon Varty has 38 years experience as the Head
Superintendent at Elk River Golf Club.
Along with the management experience the board is proud of the
service and commitment to keeping 2 courses in Elk River. With the
vast majority of our shareholders being Elk River citizens who want to
keep this asset in the community. We feel having a local company
with a commitment, resources and knowledge we will ensure
Pinewood will be around for next generations to enjoy.
Past Performance
FI Elk River Golf Club has successfully operated a golf club for 61 years.
In recent success, Elk River Golf Club has shown profit in 6 of the last
10 years and has reduced its total debt liability by 40%.
Over the last 4 years Elk River Golf Club has grown Pinewood Golf
Course back to success after being closed for 3 years. In those
years, Elk River Golf Club has used their knowledge of improving
and maintaining a golf course by bringing Pinewood Golf Course
back both turf and business wise. Over that time: greens and
fairways have been grown back in, leagues have been
PINEWOOD GOLF COURSE - 2/25/2021 - PAGE 2
re-established, and overall profitability of the course has grown
each year from 2016 to 2020.
Benefits of This Proposal
Elk River City Council: The primary value used for the sale is the
exchange of land. This allows the buyer to operate with little debt
which means Pinewood remains a golf course for a minimum of 30
years. Elk River City Council receives the highest assurance that the
purchase agreement will be executed. The Elk River Park and Rec
receives a highly coveted property of 27 acres that will be added to
the Woodland Trail System.
Elk River Citizens : They know that for a minimum of 30 years that
Pinewood will remain a golf course for their enjoyment. The citizens
who use Woodland Trail System continue to have a true outdoor
experience with no development encroaching the trail. The
residents who live by Pinewood and the residents adjacent to this 27
acres of land strongly feel both of these properties need to stay a
green space.
Elk River Golf Club : Utilizing our experienced staff we will efficiently
operate both Pinewood and Elk River golf courses. This helps our
economy of scale which gives both courses a better than average
success rate. We can offer a good golf facility to all residents
regardless of their golfing skills.
Capacity Finance Acquisition
Elk River Golf Club cash payment of $25, 000 will be paid on
Thursday April 1 s1 2021. $25,000 has been put in an escrow account
at the Bank of Elk River and will not be financing any part of the
purchase of Pinewood Golf Course.
Elk River Golf Club has started a capital improvement fund for both
Pinewood Golf Course & Elk River Golf Club to ensure long-term
success of both golf courses. $17,500 to be spent in 2021, $24,000 to
be spent in 2022 and $18,000 to be spent in 2023.
Being an established golf course, ERGC has the ability to cycle
equipment between both Pinewood Golf Course & Elk River Golf
PINEWOOD GOLF COURSE - 2/25/2021 - PAGE 3
Club. Using this tactic will use our resources to ensure the playability
and success of Pinewood. For example, ERGC would be able to
provide a used green mower for $7,000 instead of another party
purchasing a comparable green mower at the retail price of
$14,000.
Section 2 Purchase Terms
Time Frame
Utilizing the processes currently in place along, with Elk River Golf
Club's purchase price, ERGC agrees to continue to manage &
keep Pinewood Golf Course a public golf course for a minimum of
30 years, showing commitment to the citizens of Elk River.
Type of Purchase
The proposed purchases fee title.
Purchase Proposal
Elk River Golf Club's purchase proposal $25,000 cash due April 1 S'
2021. All survey & closing costs will be paid by the City of Elk River,
and ERGC will assume all property taxes in 2021 upon successful
closing. The land outlined in appendix which is approximately 27
acres will be sold to be preserved as green space. All equipment
will be sold with property that was used in 2020, see attachment in
appendix for detailed list.
Finances
Elk River Golf Club has set up an escrow account at the Bank of Elk
River and the offered $25,000 has already been set aside in this said
escrow account, ERGC will not be financing any part of the
purchase of Pinewood Golf Course.
Attached is the audited 2018, 2019 P&L along with the unaudited
2020 P&L.
PINEWOOD GOLF COURSE - 2/25/2021 - PAGE 4
With the 40% debt reduction at Elk River Golf Club the past 10 years
and the structure of the proposal, Elk River Golf Club is in a solid
financial position. With recent years of success and debt reduction,
Elk River Golf Club has the opportunity to make the purchase of
Pinewood Golf Course at this time. In addition to the great financial
position of ERGC, the buying power and equipment sharing
between both facilities will give Pinewood the advantage of having
more and newer equipment.
PINEWOOD GOLF COURSE - 2/25/2021 - PAGE 5
Appendix Profit and Loss Statement
Elk River Country Club Inc
DBA: Elk River Golf Club & Pinewood
Profit & Loss Statement
Income 2018 audited 2019 audited 2020 unaudited
Sim Rental
Pinewood Mgmt. fee
Clubhouse Sales
Green Fees
Carts
Membership
Proshop
Handicap Income
Jr. League Income
Driving Range
Total Income
Cost of Goods Sold
Clubhouse
Proshop
Total COGS
Gross Income
Expenses
Administration
Depreciation
Maintenance
Advertising
Wages
Supplies
Taxes
Utilities
Pinewood Closeout
Total Expenses
Other income
Net Income (loss)
PINEWOOD GOLF COURSE - 2/25/2021 - PAGE 6
$ 1,960
$ 24,903
$
345,058
$
314,998
$
276,650
$
303,756
$
305,219
$
353,169
$
112,970
$
110,523
$
151,228
$
173,485
$
174,736
$
187,374
$
101,706
$
96,816
$
85,679
$
11,729
$
9,132
$
9,511
$
7,455
$
9,055
$
8,560
$
43,303
$
44,238
$
55,823
$
1,124,365
$
1,064,717
$
1,127,994
$
139,890
$
131,265
$
131,614
$
83,631
$
70,074
$
80,420
$
223,521
$
201,339
$
212,034
$
900,844
$
863,378
$
915,960
$
165,683
$
173,150
$
188,167
$
17,629
$
17,131
$
17,138
$
23,403
$
25,591
$
33,444
$
21,366
$
17,351
$
12,594
$
431,329
$
420,587
$
437,490
$
105,640
$
105,993
$
112,172
$
20,276
$
20,666
$
21,488
$
51,699
$
52,712
$
58,123
$
40,962
$
-
$
877,987
$
833,181
$
880,616
$
15,205
$
6,477
$
5,000
$
38,063
$
36,674
$
40,344
Land Map Attached
Length: 7,574 feet `✓
C
Area: 27.78 Lacres `✓
Maintenance Equipment Inventory As of Feb. 25th 2021
• 6 Green ball washers with stands
• 2 weed whips
• 1 blower
• 1 walk behind toro aerifier
• 1 walk behind spreader
• 1 pull behind spreader
• 1 Toro Sidewinder
• 1 Toro Fairway mower
• 2 Toro greenmaster mowers
• 1 Toro Workman cart
• 1 club car cart
• 1 Cushman sprayer
• 11 ezgo golf carts
• Misc tools
PINEWOOD GOLF COURSE - 2/25/2021 - PAGE 7
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02-25-2027
Business Description:
Pinewood Golf Course is a 9 hole, Executive length, Par 30 golf course, on
approximately 27 acres of land, located at 18150 Waco Street NW, Elk River, MN 55330.
The company will be managed and operated by an experienced management team:
Jennifer Abrahamson, as Golf Course Business and Clubhouse Manager; Trevor
Birdsall, as Manager and Superintendent of the Grounds and Operations; Adrienne
Thompson, as Chief Financial Officer and Director of Marketing and Sales. AKA
"Brains, Braun & Beauty", order to be determined.
All team members are knowledgeable and capable of being versatile within the
company. This ability greatly reduces operating expenses and staffing needs.
The transition would be nearly seamless, as Trevor is entering his 5th season operating
and maintaining grounds at Pinewood Golf Course, in all regards. Additionally, Jennifer
is entering her 3rd season of customer service and clubhouse operations. She also has
experience assisting with mowing grounds, aeration, grounds maintenance and
operations. Both Jennifer and Trevor have established a great rapport with members,
guests and neighbors on the course. The intention is to grow and nurture these
relationships well into the future, as Pinewood flourishes in the years to come under our
management.
Let it be also known that 15 years is not an end goal for us, rather a timeframe. We want
to have earned your trust and confidence in that 15 years. The intention is that Pinewood
stays a golf course for years to come.
We are fully aware of the updates and expenses that can and/or will arise with a dated
irrigation system, carts, equipment, and a clubhouse that has been neglected, among
other unforeseen things that could present themselves. We are both technically and
financially able to deal with them.
Business Mission:
Our mission is to be an honest, successful, family run, community oriented business.
We strive to be a blessing to our guests, an asset to this community, and honor the game
of golf.
Our intention is to network with local businesses and to connect with churches, schools,
and other organizations that are looking for constructive activities in our community.
Services offered:
Providing a beautiful course to our guests, with greens that will challenge, and a round
of golf to enjoy! While also providing goods and services beyond expectations. We will
be offering a variety of leagues, lesson opportunities, as well as host tournaments for
charitable causes, and for fun!
Short Term Goal:
To introduce ourselves as business owners in the community. We will network with
other local businesses, build relationships, and make improvements to the grounds and
clubhouse overtime. Pinewood will not be a lost entity, it will thrive and grow.
Long Term Goal:
To be well established in the City of Elk River and surrounding areas, and amongst the
golf community. We want to provide a safe, positive and desirable destination for people
for all ages and abilities. Our intention is that Pinewood be a family owned and operated
golf course for a very long time.
We commit ourselves to making Pinewood's members, guests and neighbors thankful
that it was entrusted to us.
February 251h, 2021
To whom it may concern:
In response to your request for evidence of financial resources, this letter is to verify that Adrienne
Thompson has adequate liquid resources for a down payment of $100,000, and the ability to fund
ongoing obligations as needed for the proposed minimum period of operation.
Sincerely,
Jeffrey A Coplan, AAMS', CFP'
Financial Advisor
Registered Principal, RJFS
11985 Tpelmology DriveSuite 100 Eden 1rairie, N-1\553,1 f IntegrityWealth.rom 952-937-5003
i
Request for Proposal of the Sale of Pinewood Golf Course
1. Type of Sale Proposed:
Our proposed sale includes a downpayment of $100,000.00, in conjunction with
a Contract for Deed spanning the 15 year agreement. Upon 15 years, any
remaining balance will be paid in full.
2. Proposed minimum period of operation as a golf course and mechanism
for ensuring operation:
We commit to keeping the property a golf course for a minimum of 15 years. Let
it be known that our intention is that Pinewood remains a course well into the
future.
3. Purchase amount and proposed terms of payment:
Our proposed terms of payment are as follows: $420,000.00, of which
$100,000.00 will be paid upon closing and the remaining $320,000.00 to be paid
as Contract for Deed with the City of Elk River, to span the 15 year agreement.
Upon which, the loan will be paid in full.
4. Evidence of Financial Resources:
Please see attachment to this document. Our investor has had a letter prepared
by their financial managers to erase any doubt that funds to manage the golf
course are in any way in question.
5. Golf course management experience:
Trevor Birdsall was born and raised in Elk River, about one mile from Pinewood
Golf Course. He received his education from Anoka Technical College, as a
member of the Turf and Golf Course Management Program. Trevor was hired by
ERGC to work on the grounds at Pinewood in 2017. For the majority of the last
four years, he has been the head and manager of the grounds at Pinewood. He
has managed his own staff, handled scheduling, set mowing cycles, maintaining
equipment, spraying, fertilizing, preparing the course for daily play, maintaining
the irrigation system, and more! In his time as management, the course has
maintained a 4.4 / 5 star rating or better on GOOGLE and Golfnow.com. Trevor
is eager to not only maintain but improve that rating!
Jennifer Abrahamson is going into her 3rd season with Pinewood. She has been
part of clubhouse operations and customer service, and it will be her 2nd season
of assisting on the grounds crew. Grounds experience includes assisting with
aeration, mowing grounds, and other general maintenance duties. Jennifer is a
Registered Dental Hygienist, and is employed at a local dental office part time.
She is also the mother of 2 girls, so she is obviously an experienced multitasker!
She has more than 20 years of experience in customer service and record
keeping. She gets as much joy from the senior members as she does the
children she teaches golf lessons to. She loves golf and people.
Adrienne Thompson is an experienced and successful entrepreneur. She has a
degree in Marketing and Communications from Concordia College in Morehead,
MN. Adrienne is a wealth of knowledge and experience in sales and all aspects
of business ownership and management. We are blessed not only to have her
faith in us as our investor, but her expertise in business ownership and
management.
6. Business Plan:
See attached business plan.
Request for Proposals (RFP)
Purchase of Pinewood Golf Course
Section I: General Information
Contract Administration
All correspondence regarding this Request for Proposal (RFP) must be directed to:
Michael Hecker
Parks and Recreation Director
City of Elk River
13065 Orono Parkway
Elk River, MN 55330
MHecker(ta)ElkRiverMN.gov
All questions must be received before 4:00 p.m. on Wednesday, February 24, 2021. Questions received
after that time will not receive a response.
Proposals will be accepted until 4:00 p.m. on Thursday, February 25, 2021.
Please submit two (2) hard copies and one (1) PDF copy of your firm's proposal.
All persons or companies who download this RFP are requested to register their name and email address
by sending an email to MHecker@ElkRiverMN.gov. Any revisions to or corrections on this RFP, after it
has been advertised, will be communicated to those registered RFP holders. Failure to register your
contact information as described is at your own risk. A proposal will not be considered if it fails to include
all requested information as detailed in this original RFP and any subsequent modifications.
Acceptance of Proposal Contents
The contents of this RFP and attached information provided to the proposer will be included as part of
the contractual obligations if a contract ensues. All information in the proposal is subject to disclosure
under the provisions of Minnesota Statutes Chapter 13 — Minnesota Government Data Practices Act.
Proposal Timeline
Submission of proposals Thursday, February 25, 2021, by 4:00 p.m.
City Council review and consideration Monday, March 1, 2021
Project Overview
The City of Elk River requests proposals from responsible firms, individuals, or teams for the purchase of
the Pinewood Golf Course through:
1. Fee Title
or
2. Contract for Deed
Pinewood Golf Course consists of a 9-hole executive course with a 1,700 square foot clubhouse and a pole
barn maintenance building.
Any sale will require that Pinewood be operated as a golf course for no less than ten (10) years.
Respondents shall outline their proposed terms as it relates to the type of sale sought. Final terms will be
negotiated with the successful respondent(s). Purchase Agreements will only be entertained for the entire
golf course property and buildings and shall at a minimum include the following in their responses:
1. Type of Sale Proposed.
2. Proposed minimum period of operation as a golf course and mechanism for ensuring operation.
3. Purchase amount and proposed terms of payment.
4. Evidence of Financial Resources.
5. Golf course management experience and business plan.
The intent of this request is for the City of Elk River "City" to sell the Pinewood Golf Course property
"Course", equipment and operations and said property, equipment and operations become the
responsibility of an individual or management firm, hereinafter referred to as the "Firm".
Section 2: Background
City Profile
The City of Elk River is the county seat of Sherburne County, Minnesota located approximately 34 miles
northwest of Minneapolis situated at the confluence of the Mississippi and Elk rivers. The 2015 population
was approximately 24,000.
Parks and recreation facilities are essential to Elk River's identity and to the quality of life for residents.
With 42 parks and recreation facilities and more than 1,000 acres of parkland, the city has a strong
commitment to parks and recreation for residents and visitors alike. Through the city passes the Great
Northern Trail (north/south) and the Mississippi River Trail, connecting Lake Itasca to the Gulf of
Mexico.
To protect, cultivate and guide future strategic decisions, the City Council adopted the Parks and
Recreation Master Plan in June of 2015. The plan provides direction for the Council, the Parks and
Recreation Commission and city staff for strategic decisions impacting the parks and recreation system.
Pinewood Golf Course Profile
Pinewood Golf Course lies on the westerly corporate limit of our active and growing city. The course is a
9-hole, Par 30 executive length course on approximately 27 acres of land. Course length ranges from 1,497
to 1,832 yards.
The city purchased the course from the original owner in 2005 and operated Pinewood from 2006 to 2013.
The average number of rounds for each year of operation was approximately10,000. Most of the users
were local senior citizens and youth. The golf season was typically from April to October. City operations
included a full-time Golf Course Superintendent and seasonal staff to maintain the course and clubhouse.
The course was closed for the 2014 and ensuing golf seasons and maintained in a reduced maintenance
state with the intention that it could be returned to service in a minimum amount of time. The Master Plan
made little reference to Pinewood. However, through the planning process, residents expressed a strong
desire to retain golf as part of the city's recreation offerings (Appendix E, Parks and Recreation Master
Plan Page 23). Resident desires to retain the course include providing an affordable golf option supporting
new golfers with a learning course and ensuring family friendly activities that appeal to all ages.
With the goal to once again open Pinewood for its residents and visitors, in June 2016 the Elk River City
Council expressed consensus to seek a responsible management firm to manage the golf operations, lease
the course for operation or purchase the course with the intent of operating it as a golf course for a
minimum of five (5) years.
The City advertised and received two proposals in November of 2016 for the management/sale of
Pinewood Golf Course — Elk River Golf Club and Chase Michael Home/Dalbec Property Management.
City Council consensus at the November 21, 2016, work session was for the city to negotiate with the Elk
River Golf Club (ERCG) into a formal agreement. City Council approved a two-year contract with the
ERCG with a management fee of $4,000 per month during operational months for those two years. The
City paid all operating expenses and received all operations revenue.
In 2019, the City approved a new three-year agreement with the ERCG. The new agreement removed the
management fee and included an annual lease for $1 per year. The ERGC became responsible for all
operational maintenance costs while the City agreed to fund capital equipment replacement.
A 1,700 square foot clubhouse sits adjacent to the Number 1 tee box. The city last made interior
improvements in 2011 and ERGC made minor improvements in 2017. A golf check -in area with counter
and snack sales occupies the front section of the building with a small area for tables and chairs for golfers
to relax and swap stories of missed putts. Packaged food was permitted for sale as the facility does not
have a kitchen/concession operation. Two (2) restrooms, men's and women's, are towards the rear from
the counter area and are not ADA accessible.
The course does not have a driving range.
In addition to the clubhouse, a 1,350 square foot pole barn serves as a maintenance facility. No specialized
facility exists for either gasoline storage or pesticide storage. The irrigation water source is adequate with
the overall system supplied directly by a well and pump system.
Section 3: Proposals
The proposal shall contain the type of information summarized below. Additional information is
allowable, providing it is directly relevant to the proposed project. The submittal should follow the labeled
sections below as follows.
Section 1— Firm experience, past performance, and capacity: Provide a description of experience,
past performance, and capacity to finance acquisition of the golf course and to deliver the proposed
services and experience in management and operation of the golf course.
Section 2 — Purchase Terms:
a. Any sale will require that Pinewood be operated as a golf course for a minimum of ten (10) years.
Include the proposed minimum period for operation as golf course and the mechanism for
ensuring that this commitment is met (i.e. restrictive covenant, contract for deed terms, etc.)
b. Include whether the type of sale proposed is to purchase fee title, to enter into a contract for deed,
or other.
c. Include the purchase amount and the proposed terms of payment.
d. Include evidence of the purchaser's ability to finance the purchase price and to meet its obligations
to operate the golf course for the proposed minimum period of operation.
e. Final purchase terms will be negotiated with the respondent that the City Council determines best
meets the City's goals for the golf course and the City.
Section 4: Selection
Proposals will be reviewed and evaluated by the City Council. The City reserves the right to reject any or
all proposals. The City further reserves the right to evaluate proposals based on all proposed terms and to
enter into an agreement with the proposers and on the terms that the City Council determines best meets
the City's goals for the golf course and the City.