ESCONDIDO — Reidy Creek Golf Course has a new management company in charge.
Earlier this month, the Escondido City Council approved a new five-year management and concession agreement with CourseCo, Inc., a company that specializes in managing municipal golf courses, to assume operations at the golf course located on North Broadway.
California-based CourseCo manages nearly 40 golf courses between six states. Of those golf courses, the vast majority are owned by a public agency.
Council has discussed changing the management agreement for Reidy Creek over the past four years leading up to this year when the current contract with JC Resorts is set to expire.
JC Resorts has managed the inland golf course since opening in 2002, and currently manages several courses across North County San Diego, including Encinitas Ranch and The Crossings at Carlsbad.
The council approved two 10-year contracts with JC Resorts, making them responsible for operations, upkeep and maintenance. In return, the city paid the company $86,066 annually, which increased by 3% each year. The company also collected 0.75% in gross revenues, which was nearly $7,500 last year.
Staff took note of the council’s concerns about the length of the 10-year agreement and fees. The new agreement with CourseCo is only five years with only one chance to extend for four years. The fee has dropped to $75,000 with a 2.5% increase annually.
Once the golf course’s debt services are paid, the new company can also collect 10% of the net profit. The city will receive 10% of the food and beverage revenue.
Additionally, the new agreement will have more city oversight and an annual capital funding reserve with 5% of gross profit for future capital improvements.
“This is a new model that we’re implementing in order to have a better mechanism for funding current and future capital needs,” said Real Property Manager Vince McCaw.
The city is responsible for the tax-exempt lease revenue bonds that were issued to construct the golf course in 2001. The plan was to pay those bonds back with revenue from the golf course but that level of income was never achieved, so the city has to pay back about $361,000 of debt service per year from the general fund. The current outstanding principal and interest on the bonds is about $3.3 million which is to be paid by October 2030.
Reidy Creek is a 2,582-yard course with 18 holes of golf, disc golf and foot golf; a pro shop with golf and disc golf merchandise; and a newly renovated clubhouse and Creekside Tavern that serves as a venue for meetings and special events.
CourseCo has also promised to replace the nearly 20-year-old golf carts and other deficiencies with equipment from its other golf courses until the city can afford to replace them with new equipment.
“That was one of the compelling reasons why we thought CourseCo would be a good fit,” McCaw said.
According to Tom Bugbee, a representative of CourseCo, the company wants to increase opportunities for the community at Reidy Creek beyond just golf. He noted potential concepts include increased food and beverage, small concerts, a disc golf tournament and cross country runs.
“There’s a lot of opportunity to not only bring the community out but also create new revenue streams as well,” Bugbee said.
City Council was pleased with the new management agreement and CourseCo taking over.
“I think this management agreement is much better than what we’ve had in the past,” said Councilmember Joe Garcia. “I’m thinking of maybe at least one or two other golf courses that need your type of leadership.”
Deputy Mayor Tina Inscoe, who lives in the Brookside residences that were developed in conjunction with the Reidy Creek Golf Course, is also excited and hopes to see more opportunities for the community there.
“I walk that area on a regular basis so I know a lot more people could be using it,” she said.
