What is the greens fee per round

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Reference no: EM131012716

You are considering developing an 18-hole championship golf course that requires an investment of $20,000,000. This investment cost includes the course development, club house, and golf carts. Once constructed, you expect the maintenance cost for the golf course to be $650,000 in the first year, $700,000 in the second year and continue to increase by $50,000 in subsequent years. The net revenue generated from selling food and beverages will be about 15% of greens fees paid by the players. The cart fee per player is $15, and 40,000 rounds of golf are expected per year. You will own and operate the course complex for golf are expected per year. You will own and operate the course complex for 10 years and expect to sell it for $25,000,000. What is the greens fee per round that will provide a return on investment of 15%? Assume that the greens fee will be increased at an annual rate of 5%

Reference no: EM131012716

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What is the greens fee per round : What is the greens fee per round that will provide a return on investment of 15%? Assume that the greens fee will be increased at an annual rate of 5%

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