Food & Beverage

 Last year, during budget meetings, Phil Vigil - Troon General Manager - told the Board that Troon was projecting a 25% increase in revenue for 2024.  I asked what that estimate was based on and never received an answer. The figures for January show they were $36,000 under that projected revenue. There was no explanation of why they missed that mark.

They also ended 2023 $189,000 over budget. Again, this was something I warned the Board about at the budget meetings.  

Shadows Restaurant was built by Pulte as a clubhouse not a restaurant. The bar is very small and the kitchen was not built to handle any volume. However, we now view Shadows as a place to eat breakfast, lunch and dinner.  Troon, the company that runs the golf course, also runs Shadows.

There have been surveys and focus groups about Shadows for 10 years.  There are some common themes.  Residents would like to see an expanded bar and happy hour. Others would like to see more consistency in service and the quality of food. Some residents would like to see Shadows leased out to a private restauranteur. 

Most residents who have responded to the various questionnaires share the belief that Shadows is a restaurant for the community and improvements are needed.  Desert Retreat, the new 1500 home community being planned across the street from Shadows, uses Shadows' convenient location as a selling point on their website. If residents of Desert Retreat do dine at Shadows the facility will have a difficult time handling the increased volume and servicing our community. So decisions will have to be made. Some of the possible solutions:

1. Close Shadows to the public

2. Remodel and expand the restaurant 

3. Nothing

All of the solutions have their issues. If we close the restaurant to the public it's almost guaranteed our subsidy would have to go up. Remodeling and expanding the restaurant comes with a high initial investment. Part of that investment could be recovered by increasing the menu prices and offering a resident discount. If we do nothing we could be faced with a crowded restaurant that doesn't serve the needs of the community.

The current Board has pointed out Desert Retreat will not be completely built out for about 7 years, with initial building starting late this year. We can wait and see what the need is 5 years from now or plan for it now. If we decide on an expansion for example, it would be cheaper to start now than wait for 5 - 7 years. If we had fixed the issues 10 years ago the cost would have probably been 1/3 of what it would cost today. And 5 - 7 years from now? Yes, very expensive.

It's time to do strategic planning and give the homeowners options. We have a million dollar view from the Restaurant and it's a shame not to maximize its potential.  We also need to look at the way the restaurant is operated and what kind of dining experience we want. 

Remember, Shadows is an amenity and will always need to be subsidized. But $600,000 per year is excessive.  

I have over 20 years of food and beverage experience and can say for a fact we can better no matter what decision we make.

There has been a lot of misinformation  from one of the Board members about the plans for Montecito Cafe.  As all Board members and various Committee Chairs know,  the Cafe was never intended to be a 1 million dollar project.  The plan was to first get input from the homeowners about the use of the Cafe through town halls and surveys.  And if the homeowners agreed, to spend somewhere in the neighborhood of $85,000 to $100,000 - less than $30 per household.  We could then open the Cafe for a daily happy hour with a full bar and numerous food options.  It would also improve service for the numerous events put on by Lifestyles at the Montecito Clubhouse. In any food and beverage operation, selling food has very small margins for profit or breaking even.  Liquor sales on the hand have much lower costs and are more profitable.  Comparisons with other similar communities show our ratio of liquor sales to food sales is much lower - which leads to higher costs and higher subsidies. The current operation at the Montecito Cafe was done with no planning. There was no business plan submitted.  No survey of the community. It is serving very few residents and sales are less than $100 per day. If you keep track on NextDoor, Kim Fuller has accused the Food & Beverage committee of wanting to open the Montecito Cafe without a business plan or community input. But that's exactly what Scott Pessin did.  When the winter residents leave for the summer we really can't afford to keep it open with the current formula.

And since the Montecito Cafe is only for the homeowners we don't have to worry about the impact of the new Desert Retreat.  It would also cost a fraction of remodeling Shadows. And we have another fantastic view from the Patio of the Montecito Cafe!

Before the pandemic there were full banquet services at the Montecito Clubhouse. Now, there are almost no banquets.  The Food and Beverage committee encouraged the Board to require Troon to reestablish banquets as required by our contract with Troon.  To this point Troon will only cater food to the Clubhouse and most of our clubs go to other facilities for their banquets.  That needs to change.

We have some hard decisions to make about our food and beverage services over the next couple of years.  The Board dissolved the Montecito Cafe Ad Hoc Committee because improvements were not in the budget for this year.  That was very short-sighted.  The President of the Board is fond of saying "a future board will have to deal with that".  Our next Board will do that after getting the appropriate information from the homeowners.

I have the experience to lead that effort. We have many knowledgeable homeowners with the proper experience to help guide that effort.

I opposed the 37% increase in our food and beverage subsidy this year because it was unnecessary and the information provided by Troon was inadequate to justify the increase. I spoke to the Board at two budget meetings and asked the Board to get more information.  Troon estimated there would be a 25% increase in revenue in 2024.  We are less than two months in and they are already behind in their projection by over $50,000. Our subsidy has doubled in the last 5 years. And we receive less service than we did 5 years ago. That has to change.