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Madrona Links Golf Course not going anywhere

Posted on June 17th, 2024 By:

PenMet Parks has no intention of closing Madrona Links Golf Course.

“I want to be clear,” Executive Director Ally Bujacich said to about 50 golfers and neighbors attending a special board study session on June 13 at district headquarters. “We’ve heard concerns we want to directly address. We will continue to operate Madrona Links as a golf course.”

The golf course spreads across 79.8 acres owned by PenMet and an abutting 14.3 acres under a 50-year lease that expires in 2028. Rumors flew after Tyson Limited Partnership sold the leased smaller piece to ZTM Holdings on Dec. 20 for $1 million. PenMet expressed interest in buying the property and set aside $1 million for that purpose, attorney Mark Roberts said. But the sellers did not consult PenMet.

A crowd of golfers sits behind, from left, National Golf Foundation consultant Richard Singer, PenMet Executive Director Ally Bujacich and attorney Mark Roberts.

A crowd of golfers sits behind, from left, National Golf Foundation consultant Richard Singer, PenMet Executive Director Ally Bujacich and attorney Mark Roberts.

Roberts steered the crowd and board through the course’s 46-year history. The city of Tacoma, which owned the 79.8 acres, entered a 50-year lease with Ken Tyson in 1977 to develop, manage and operate Madrona Links Golf Course. Tyson bought an adjoining 14.3 acres to create the needed space. The course, which cost $1 million to build, opened in 1978.

PenMet bought course from Tacoma

Tyson ran the course before subleasing operations to JDL in 1986. PenMet Parks purchased the golf course from Tacoma in 2008 for $2 million and assumed the lease with Tyson and the sub-lease with JDL. Tyson replaced JDL with Stutsman Enterprise in 2014.

In 2019, PenMet began hearing concerns about poor course conditions. Those primarily involved the clubhouse restrooms and fire danger caused by brush piled along fairways and behind greens, Roberts said.

After the issues weren’t fully remedied, the parks district issued a notice of default in April 2022, giving Tyson 90 days to comply. PenMet lifted the notice after Tyson cooperated, but issued a second one in November 2023 after finding more problems.

Madrona Links Golf Course was packed on Saturday morning.

The golf course was packed on Saturday morning.

In June 2023, Zack Rosenbloom and Mark Owen asked to meet with PenMet about Tyson assigning the lease to them and them entering a new long-term lease with the parks district. PenMet responded that the law requires it to conduct a competitive bidding process and asked for the pair to provide their qualifications to operate a golf course. Rosenbloom and Owen submitted a proposal that discussed golf course improvements but nothing about their qualifications.

PenMet wanted to buy the 14 acres

PenMet learned that Tyson was considering transferring the 14-acre parcel to Rosenbloom and Owen. Desiring to keep the golf course property intact, the district expressed interest in purchasing the property.

In late summer 2023, Tyson announced that it was no longer interested in operating Madrona Links due to the ongoing problems. It proposed assigning the lease to Rosenbloom and Owen. PenMet rejected the proposal, and Tyson renewed its sublease with Stutsman.

ZTM Holdings (aka Rosenbloom and Owen) purchased the 14 acres in January. Tyson then appointed Rosenbloom and ZTM Holdings as its managing representative under the lease, taking over day-to-day issues. Tyson/ZTM Holdings agreed to inspect the clubhouse and restaurant building and provide a plan to address course maintenance deficiencies. PenMet has seen neither.

PenMet leases out Hackers Bar & Grill at the golf course.

Stutsman leases out Hackers Bar & Grill at the golf course.

With the 50-year lease winding down and continued concerns about the golf course’s condition, PenMet hired Richard Singer of the National Golf Foundation in December to assess the course and provide recommendations for operations after the lease expires.

Singer discussed his preliminary assessment Thursday. Madrona Links is a jewel in the rough, he said. It’s in a pleasant setting and convenient location, but needs a lot of work.

Some issues are out of the park district’s control, some aren’t. It is small for an 18-hole course, at 94 acres. About 120 acres is the standard. It was not designed or built well, he said. There are too many trees. They block the sun and air flow, making it difficult for the turf to recover. Their roots upheave the asphalt cart paths, causing golfers to veer into the grass and harm it more.

Lease expenses could go to maintenance

Madrona Links has a unique operating structure with several leases and subleases.

“It’s something in 30 years (in the business) I’ve never heard before,” Singer said. “There’s a lot of money going to leases instead of back into the golf course. … There’s definitely a place for Madrona Links as a golf facility, especially if it were to be improved.”

Singer listed between $1.8 and $2.4 million in high-priority investments. They include cart paths, drainage enhancements, tree trimming, thinning and removal, pond repairs, clubhouse enhancement and maintenance building upgrade. Lower-priority investments, including a whopping $3-3.4 million for a new irrigation system, would bring the total for capital projects to $6-7.4 million.

Course is popular

Madrona Links, like many courses, experienced a COVID bump in popularity. Golfers played some 42,659 rounds in 2023 with a gross revenue of $1.8 million, not including food and beverage.

“That is enough revenue to properly support this golf operation, if the money was properly invested into the property,” he said. “Those are pretty strong numbers for a small golf course like this. It’s doing pretty well, considering the condition.”

Singer’s recommendations included requiring the tenant to commit to catching up on deferred maintenance; beginning to prepare for the lease expiration in 2028; making modest adjustments in pricing; and increasing the focus on new player development such as beginner programs, juniors and young adults.

A golfer tees off at Madrona Links Saturday.

A golfer tees off at Madrona Links on Saturday.

“It’s got great potential,” he said. “You’ve got a lot to be proud of, but you’ve got to catch it up. It’s 2024, not the 1970s. You’ve got to bring it into the 21st century.”

Should PenMet not have access after 2028 to the 14 acres it leases, it might have to reduce the course to nine holes, or turn it into an executive or par-3 layout, Singer said.

PenMet expects Singer’s final in a couple weeks.

Stutsman responds

Matthew Stutsman of Stutsman Enterprise said Monday that PenMet presented skewed information at Thursday’s meeting. He met with Roberts and Singer and said the needed improvements are PenMet Parks’ responsibility. He can’t perform them. His contract obliges him to invest 1.5% of gross greens fees — about $15,500 — into the course each year. He spends eight times that much, he said.

“You can’t run a golf course and only put $15,000 into capital improvements a year,” said Stutsman, claiming that PenMet and Tyson have put no money into the facility. “They paint the picture that Stutsman Enterprise is the bad guy. I’m not the bad guy, as will come out in the report. I’ve put hundreds of thousands of dollars into improving it. It hurts my feelings and my employees’ feelings because they do a good job.”

PenMet has no cause to default on Stutsman. It’s just being a bully, he said.

“My numbers have jumped the last 11 years in a row, Stutsman said. “If it’s so bad, we wouldn’t be busy. If the facility was in that bad of shape, people wouldn’t be playing there.”

Little communication

Nobody from PenMet has spoken to Stutsman in several years, he said. And they should, because even though the parks district contracts with Tyson and not him, Tyson is an absentee owner.

PenMet can and should force ZTM Holdings to sell the 14 acres to it through eminent domain, Stutsman said.

Stutsman has a long history with the course, beginning as a member in 1988 to running the restaurant for a couple years to handling operations since 2014.

“It really means a lot to me,” he said. “I put my heart and soul into it and it really hurts the way I’ve been painted. The report coming out in a couple weeks will be a lot clearer about what needs to be done here, and it’s not on Stutsman Enterprise. I just want the best for the golf course and don’t want to see it go away.”

ZTM Holdings couldn’t be reached Monday.

Sehmel presents proposal

William Sehmel Sr. served as PenMet board president when it purchased the golf course and has a special affinity for it. He was aware that ZTM bought the 14 acres and that the land could become unavailable in 2028.

“If that 14 acres is not going to be a golf course, somebody had to have an idea what could be done with … the rest of the property,” Sehmel said.

So Sehmel paid out of his own pocket to have consultant AHBL whip up a plan. It features an 18-hole pitch-and-putt course and the community’s top park amenities as identified in PenMet’s PROS plan. They include walking trails, an outdoor pool, playground, splash pad, picnic lawn, amphitheater, dog park, pickleball courts, baseball field and multipurpose fields.

Concept plan for Madrona Links Golf Course reduced to 80 acres.

Bill Sehmel paid to have a plan drawn up showing how Madrona Links could look if it lost the 14 acres it leases and was left with 80 acres.

“You can still get the fun of playing the par-3 and it allows about another 40 acres for other activities,” Sehmel said.

Starting a conversation

Sehmel sees the plan as a conversation starter and to possibly further his longtime quest to bring the city of Gig Harbor into the PenMet Parks district. The city limits border the golf course.

“It was just to show what could be done with that property if we lost that 14 acres,” said Sehmel, who presented the drawing to PenMet in March. “It was something to continue the conversation to find out the community interest. My whole deal all along has been to get the citizens of Gig Harbor to join the park district and maybe this would be something to stimulate them in that way.”

Sehmel realizes a project of that magnitude would probably require passage of a bond measure.