PALM VALLEY — When Bryan Easley gazes around at the activities happening at Harlingen Country Club, he sees new faces and feels a renewed energy that comes with success.
Cookouts, bands for Fourth of July, open houses, a tent campout with a movie, hot dogs and smores on the driving range and reduced membership rates are all part of the latest efforts at the club to bring a festive, family environment and value to what recently was a private club struggling like so many others across the country.
But, the turnaround now is real.
In just the past year, Harlingen Country Club has added dozens of new families, lifting its membership to around 440.
Easley, the facility’s general manager, said membership was 321 when Mosaic Clubs took over as the management company in June 2017. Since he’s been here, August 2017, much has changed.
New activities, more of a focus on social and family events along with an “outside the box” thinking is making things happen at the club — and in turn bringing new members.
Harlingen Country Club Board President Craig Lonon said there were many years in which the club didn’t have to try very hard to keep and gain members. Golf was the main draw, too.
But that has all changed recently.
He talked about a recent paint and pour event in which people learn to paint and can have a little wine at the same time.
“Programming is important to get members,” he said. “There are too many other entertainment options for people to choose from.”
That’s why one of the main focuses has been on creating family and social events.
The past few years, the membership has been split between those focusing on golf and those more on the social aspect of being part of the club, Lonon said. Youth involvement also has been a focus for the club.
“It is not your grandfather’s club,” he said. “People are out there with the kids. It is just a good family place.”
“The more engagement you have, the better club you have,” Easley added. “People want to be a part of it. Our membership efforts are going really well.”
So, with increased membership comes more revenues for the club. Senior Vice President of Operations for Mosaic Clubs Tom Ridge said one of the keys to the improvements was the reduction of the monthly dues in an effort to increase membership.
“The dues were reduced and brought in line with market demand,” he said. “When you are priced correctly and your value equation is correct, the club will sell the more inclusive, full benefit memberships that are also offered at the higher price point as opposed to the less expensive membership.”
Lonon said the 2017-2018 fiscal year has been a “rock star” for the club with increased membership and revenues.
He gave a significant amount of credit to Mosaic for helping the club become competitive financially with other facilities. But, it wasn’t an easy decision to bring in the company to help run the club.
“We had to admit we didn’t know what we were doing,” Lonon said about where things were more than a year ago. “We had the highest dues in the area, charging $430 a month for golf. We were losing members. We were doing the same things over and over and they weren’t working.”
Mosaic stated they could be successful and the board listened, Lonon said. So, the change was made and improvements have followed.
“Membership is the lifeblood of any private club and we have certainly increased that,” Easley said. “When you do, it is great for the community, especially here in Palm Valley.”
But the key is, membership increases lead to more revenues, something the private club was struggling with as recently as a year ago.
Now, both the owners and those who have been around the club for years, back to when it was created, agree it has turned the corner financially.
Palm Valley resident Matt Gorges, who has been involved with the club for nearly 60 years, and may be the only person still living who was part of the original development back in 1968, believes the club is headed in the right direction.
He attributes that to the efforts of the management company, Mosaic, which has helped Rancho Viejo make a comeback as well.
“There is no question things are better than they were,” Gorges said about HCC during a recent phone interview.
Lonon is pleased with the direction, but the board is far from dancing on the greens or in the dining area, yet. With a goal to add 50 members this fiscal year, the 500 member number comes into play. But, not so fast.
“The next year focus will be on 500,” Lonon said about fiscal year 2020-21.
For now, he said the board and Mosaic will continue to adjust the formula to ensure continued growth.
“We are not where we want to be yet,” he said. “We anticipate another 50 net members this year, but we are always going to tinker with it to find out what our members want. We aren’t accustomed to being successful.”
Through his analysis of the club’s finances more than two years ago, Gorges found the club was losing $20,000 to $25,000 per month and being forced to dig into and use up the nearly $500,000 in reserves that were built up in 2010.
Lonon said the financial struggles came on the heels of the damaged clubhouse caused by Hurricane Dolly. Prior to that time, the club had no debt, and was doing OK. Once the borrowing occurred, paying the debt caused the problems for the club.
The financial numbers confirm that is the case. According to IRS returns filed by the Club, in 2011, expenses exceeded revenues by more than $300,000. In 2012, that number was $225,000. The 2013 losses were $204,000 and in 2014, the losses were nearly $180,000.
Lonon suggested some of the financial and membership issues also over the years have been caused by changes in the golf industry and the increase in the number of courses.
“The golf industry over the last 15 or 20 years has overgrown participation,” he said. “There is always a correction.”
According to Golf.com, since 2011, there has been a reduction in facilities by more than 700. However, there still are more than 15,000 regulation golf facilities in the United States.
Since 2011, the number of golfers has declined in the United States. There are about 29 million golfers in the country, fewer than 10 percent of the population golfs.
Because of the financial problems, the facility was, for some time, paying only the interest on that original $4 million Lone Star Bank loan taken out for the clubhouse work after Hurricane Dolly.
Now, with finances looking better, Gorges said the club is current on its payments and actually has knocked off about $60,000 or so off the balance of the loan that came from the building of the Clubhouse.
Turning it around
The main selling point for the club remains the quality of the golf course, which Gorges calls the best in the area. Mayor George Rivera agreed, stating the course is in the best shape he’s seen it in years.
Lonon believes the turnaround can be attributed to several improvements, including the more competitive membership rates, revenues being generated by the food and beverage, the outstanding shape of the golf course and additional activities occurring around at the club.
Gorges also cited a few other reasons for the success he’s seeing, including the fact that half of the new members are Hispanic.
“We have in Harlingen a growing population of educated, professional Hispanics,” Gorges said. “They are raising children and couldn’t afford to join before, but now they can. This is one of the best things happening to us.”
Overall growth in Harlingen is happening on the west end of the city.
The growth is all out this way,” Gorges said. “There are at least six subdivisions under development right now and they are in the $150,000 to $200,000 area. That is a really good market and it just so happens, the club is located right in the middle of this action.”
Gorges also sees different types of homeowners. When the club first was developed and through the 1970s, 1980s and 1990s, most of those buying or building were retirees from the Midwest. They were building their retirement homes.
“Now, that group is either deceased or has moved back for their final years,” he said. “The resale of those homes are local. It is a varied group of people coming out here.”
That has resulted in the average age of Palm Valley and the club dropping. Thus, there are more families and a desire for children-oriented activities.
“Palm Valley is not a retirement town anymore,” he said. “It was, but it’s not now.”
Those changes have also created a culture and atmosphere change at the club, according to Easely.
“Services have stepped up on the golf course, restaurant and fitness center,” he said. “We are seeing more activity. We have seen a lot of families use the facilities. We are busier.”
Although the focus is the immediate area, there are about 700 homes in Palm Valley. So the club needs to draw membership from beyond its own walls.
Easely said that has been one of the many marketing efforts.
The club is reaching out to a 20 to 25-mile radius. Although they haven’t reached out to the McAllen market, they have in the cities surrounding the club.
There’s also a greater effort on involvement with organizations and events being held at the club. The management team is more involved in the communities as well, which is helping the networking aspect of marketing.
“We are hosting the Boys and Girls Club Golf Tournament,” Easely said. “We are being more involved in the community, visiting the RV park. Between myself and the membership director stay involved the best we can.”
Regardless of the gradual changes in the community, about two years ago, Gorges admitted, he was worried for the future of the club. He said it was a scary time. Now, it’s a slightly different story.
“Compared to the hanging off the edge of a cliff a few years ago, there is progress being made,” Gorges said. “I am much more optimistic than I have been. I think it will happen.”
However, the financial problems aren’t in the rearview mirror yet.
“This is not to say there is a surplus of funds, because there isn’t,” Gorges said. “But, the situation has improved.”
Gorges said if the improvements continue for the next two years, the club will be in a good position. Another 100 members would make Gorges happy and may put him into a “comfort zone” about the financial future of the club. He said that will allow the club to build some reserve funds.
Gorges said he remembers a time when the club had 700 members and money was not a problem.
Ridge and Easley are confident membership numbers will continue to improve.
“Our goal is 50 to 70 more members and that will put us in the 500 range,” Easley said. “For the size of Harlingen and the population, to have 500 members, that is going really well.”
As for reaching 700 again as Gorges recalled, Easley had a quick answer.
“That was a different clubhouse and a different time,” he said.
By the numbers
$21,000 – the monthly net increase in revenues
27 – Percentage revenue increase year over year
23 – Percentage revenue increase over 2016
$297 – The club’s most inclusive monthly membership includes unlimited golf, tennis, fitness, dining, social events and access to the swimming pool.