A 10-year lease deal should soon be in place for Belleair’s Belleview Biltmore Golf Club.
BELLEAIR – Town commissioners agreed Jan. 2 to enter into a long-term lease with Golf Green Partners to operate the Belleview Biltmore Golf Club on Indian Rocks Road in Belleair.
Back in early December the town opened six proposals for the operation of the club. Four were to lease the property and two were to purchase it. After review the staff recommended to the commission that the lease deal with Golf Green Partners was the best way to go. After much discussion the commissioners agreed and voted unanimously to proceed on a 10-year lease.
When the town bought the golf club in February, it was thought that the club likely would either be sold or leased. The idea that the town operate the club either by itself or through a hired management team was never really considered.
The reason for buying the club in the first place was two-fold: to remove the development rights from the property so it would remain a green space and to settle accounts with the owners, the Ades brothers of Miami who owed the town $250,000 because of the deteriorating state of the Belleview Biltmore Hotel. The Ades brothers wanted the lien removed from the property so it could be sold.
Town Manager Micah Maxwell and Town Attorney David Ottinger have until the middle of the month to work out the specifics of the lease with Golf Green Partners. That company has been operating the course since the town bought it 11 months ago.
The outline of the agreement was revealed at the meeting and shows the town getting $160,000 annually for the lease, then getting 6.5 percent of all revenue generated over $1.6 million. Maxwell told the commission that revenue of at least $2.3 million is expected annually.
As well Golf Green Partners agrees to spend $500,000 on capital improvements at the facility in the 10 years.
There is also a penalty clause that indicates the town must pay the company $480,000 if it opts out of the deal in the first three years. The penalty gets less as time goes on.
Matt McIntee, the president of Golf Green Partners, said the penalty clause is necessary because the town has indicated it might opt out of the deal to perhaps sell the course in the future.
The deal with Golf Green Partners was one of two lease proposals that were seriously considered. The other was from a group called Club Pro Golf Group. Their proposal actually promised a little more revenue for the town but Maxwell wrote in his summary that the confidence level in that group was not high.
“Staff felt that the evident lack of experience specifically in running a golf course by the group does not provide the same level of confidence that they will succeed to the level GGP will, mostly because they are unknown,” he wrote.
The document noted that the Club Pro Golf group intended to bring back the former general manager to run the operation but indicated that wasn’t enough.
“They have identified intent to bring on former GM Chuck Eade as an employee, his status would have been more impactful as a principal in the ownership group,” Maxwell wrote. “The decision should be made on the structure and the principals and not particular employees, because employees can change at a fairly rapid pace.”
Of the two proposals to buy the course one was from Golf Green Partners, which offered $3.4 million, the other from a group led by Richard Heisenbottle, which offered $3.5 million, the exact price the town paid for the property.
Both offers were rejected in part because both required the town to take back the mortgage.
Heisenbottle, who has been trying to buy the hotel, has said ownership of the golf course is vital to the successful operation of the hotel. That door is still open because of the opt-out clause in the lease agreement.
Not everybody was happy with what they were hearing. The town’s Finance Committee, which reviewed the deals earlier in the day, voted 4-3 against the lease agreement with Golf Green Partners. Those who voted against it, including member Tom Kurey, said they did so because of a lack of information.
“Our vote was not a vote against Golf Green Partners,” he said. “Seeing more about the lease is doing our due diligence. What are our risks for continuing to own the course? Revenue could go down. We need more time, a couple of more weeks.”
Finance Committee Chair Tom Olson addressed the board’s rejecting both offers to buy the property.
“We rejected those offers because they required the town to hold the paper,” he said. “If they can’t make good on payments, then we’re back where we started. They are people with no money; they don’t have the money. We’re saying show us the money.”
Commissioner Kevin Piccarreto indicated he was uneasy with the deal because of there was so little time to study it.
“The timing of the meeting was tight; the holidays were in the way granted, but we need feedback,” he said. “Yet, we have to make a decision. As it is now, the management company doesn’t know where it is going; they can’t generate more membership or do anything else.”
Commission Tom Shelly, who is a real estate agent, told the commission that he agreed with the lease deal because now is not the time to sell a golf course. Commissioner Michael Wilkinson agreed with him.
Commissioner Stephen Fowler indicated he would have liked more time to study the lease deal and wondered why the town couldn’t keep the status quo and just extend the current deal with Golf Green Partners. In the end he, along with Piccarreto and the others voted to go ahead with the 10-year deal.
Maxwell and Ottinger will be back at another special commission meeting on Jan. 15 at 5 p.m. with the specifics of the lease for final approval by the commission.