Where’s the Money? What Are Courses Trading For? Presented by: Facilitator: Jim Hinckley, CEO, Century Golf Partners Panelists: Doug Main, Director, Golf & Leisure Advisory Group, Deloitte Marcia Mayes, Advisor, Hilda W. Allen Real Estate Ray Munoz, CEO, Leisure Financial Group Peter Nanula, Chairman, Concert Golf Partners

 Golf appears to be following the Hotel industry trend with separation of management and ownership companies  Better courses are starting to trade- no longer just distressed assets  As commercial and hospitality real estate gets expensive- investors start to look again at golf  Golf financing is starting to inch forward  Golf course purchase pricing metrics are still inconsistent and a large gap exists between buyer and sellers expectations WHERE ARE WE IN THE CYCLE?

SGA Investor & Lender Survey 2013 Edition Salient Indicators 2013 Overall Capitalization Rate 1 Range7.0%to14.0% Average11.1% Terminal / Residual Capitalization Rate 2 Range8.0%to15.0% Average11.8% Net Income Multiplier 3 Range2to15 Average8.0 Gross Income MultiplierRange0.6to3 Average1.5 Discount RateRange9.5%to22.0% Average14.6% 1 / Overall Capitalization reflects going-concern operations. 2 / Terminal or going-out Capitalization rates also reflect going-concern operations. 3 / Net Income Multiple (Price / Net Income) is the inverse of the Cap Rate.

“If you watch a game, it’s fun. If you play at it, it’s recreation. If you work at it, it’s golf.” ~ Bob Hope Avg. 10.8%

Salient Indicators 2013 Growth Indicators: Income Growth RateRange1.0%to4.0% Average2.3% Expense Growth RateRange2.0%to4.0% Average2.5% Operational Indicators: Management Fee as % of Gross RevenueRange1.0%to5.0% Average3.6% Capital Reserves as % of Gross RevenueRange2.0%to6.0% Average3.0% Transaction Indicators: Marketing Period (Months):Range6 mosto18 mos Average 12.2 Broker Sales Commission:Range2.0%to12.0% Average3.5%