Buying a Closed Course

13

Comments

  • DiscoDinerDiscoDiner Members Posts: 98 ✭✭✭

    @farmer said:
    Looking at the map, I wonder if this was originally a 9 hole course that had another 9 scabbed on? The front flows along, the back is just awful.

    I'm with you... that back nine struggles along.
    Honestly i would consult a design firm and look into reworking the space.
    Additionally, really really really look into what it costs to run a golf course. You mention that he wasn't able to "get the right guys who knew the grass." Those guys who really know grass are expensive, as is just about everything that goes into taking care of a piece of land that large.

    What exactly is your goal here? A class AAA golf course? A playable but not top 10 in your are course? What is your goal here?

  • farmerfarmer Members Posts: 8,083 ✭✭✭✭✭✭✭

    OP, if you want to look at the property, call the owner or listing agent. If the course was poorly maintained for years and has been left untouched for 3-4 years, it's a redo. You don't have greens or fairways to refurbish. And, you don't want a walking culture, you want an everyone rents a cart culture and has a few beers after the round in our barn/clubhouse culture. The owner may think it's worth a bunch of money because it was a golf course, but the reality is that it is nearly raw acreage.

  • Hateto3PuttHateto3Putt Smoking Makes You Look Cool! Members Posts: 6,317 ✭✭✭✭✭✭✭

    If I'm reading this straight... The asset is high priced, the course needs everything redone including a new clubhouse?

    Seriously, buy some raw land and start your own course from scratch. (or build the bowling alley and save several million if it tanks)

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  • kgeisler13kgeisler13 ClubWRX Posts: 383 ClubWRX

    Always my dream to own/manage a golf course but I do neither at the moment lol. Besides investors, I would also find a retired superintendent and retired pro to help get you going or help get advice from to get the course back looking good and how to get golfers coming in. I think you will definitely need a clubhouse within 2 - 3 years if you are making a profits. I would try to get alot of leagues to start making money and if there is no way for them to buy food or alcohol yet I would advertise that they can bring coolers.

    KG
  • SecondandGoalSecondandGoal South Shore MAMembers Posts: 260 ✭✭✭✭

    @kgeisler13 said:
    Always my dream to own/manage a golf course but I do neither at the moment lol. Besides investors, I would also find a retired superintendent and retired pro to help get you going or help get advice from to get the course back looking good and how to get golfers coming in. I think you will definitely need a clubhouse within 2 - 3 years if you are making a profits. I would try to get alot of leagues to start making money and if there is no way for them to buy food or alcohol yet I would advertise that they can bring coolers.

    Allowing golfers to bring their own booze would be crazy. Opening yourself to HUGE liability. If someone over-serves themselves while they're on your course, then kills someone while driving drunk leaving the course, kiss your course goodbye.

  • kgeisler13kgeisler13 ClubWRX Posts: 383 ClubWRX

    @SecondandGoal said:

    @kgeisler13 said:
    Always my dream to own/manage a golf course but I do neither at the moment lol. Besides investors, I would also find a retired superintendent and retired pro to help get you going or help get advice from to get the course back looking good and how to get golfers coming in. I think you will definitely need a clubhouse within 2 - 3 years if you are making a profits. I would try to get alot of leagues to start making money and if there is no way for them to buy food or alcohol yet I would advertise that they can bring coolers.

    Allowing golfers to bring their own booze would be crazy. Opening yourself to HUGE liability. If someone over-serves themselves while they're on your course, then kills someone while driving drunk leaving the course, kiss your course goodbye.

    That is a very good point but I feel like I've seen courses that allow coolers and there are tons of people who smuggle in there own alcohol anyway.

    KG
  • Hawkeye77Hawkeye77 Countdown to The Open Championship! IowaClubWRX Posts: 18,283 ClubWRX

    @SecondandGoal said:

    @kgeisler13 said:
    Always my dream to own/manage a golf course but I do neither at the moment lol. Besides investors, I would also find a retired superintendent and retired pro to help get you going or help get advice from to get the course back looking good and how to get golfers coming in. I think you will definitely need a clubhouse within 2 - 3 years if you are making a profits. I would try to get alot of leagues to start making money and if there is no way for them to buy food or alcohol yet I would advertise that they can bring coolers.

    Allowing golfers to bring their own booze would be crazy. Opening yourself to HUGE liability. If someone over-serves themselves while they're on your course, then kills someone while driving drunk leaving the course, kiss your course goodbye.

    And not legal everywhere. So don’t advertise, lol.

    Terrible idea.

  • Hawkeye77Hawkeye77 Countdown to The Open Championship! IowaClubWRX Posts: 18,283 ClubWRX

    @Hateto3Putt said:
    If I'm reading this straight... The asset is high priced, the course needs everything redone including a new clubhouse?

    Seriously, buy some raw land and start your own course from scratch. (or build the bowling alley and save several million if it tanks)

    Yep, or just burn a bunch of your money in the backyard and at least enjoy a smore.

  • kgeisler13kgeisler13 ClubWRX Posts: 383 ClubWRX

    I get your guys points for sure. Not my best idea. Just trying to get the guy some players coming through.

    KG
  • beckjg135beckjg135 Members Posts: 62 ✭✭

    if this purchase gets made, i would love for you update us often, i would totally follow this journey, where is this located, if you dont mind my inquiry

  • smashdnsmashdn Let's cut them trees down. Members Posts: 1,347 ✭✭✭✭✭✭

    Only the courses that don't have an alcohol sales license allow outside coolers around here. Part of the ABC permit is that they cannot allow outside alcohol or at least that is how it is explained. I don't live in or near the county where the course is located so I am not super familiar with what the laws are there but I do know that recently went wet or moist and the other course there serves alcohol. I'm for it from a revenue standpoint but not sure I like it from a club aspect.

    The course is located in west KY. I am intentionally vague as the property is not listed for sale but I do have someone working on my behalf to inquire about it. It isn't that I am worried that someone would swoop in and buy it out from under me, but just a professional courtesy as we are talking about why the business may have failed and some of the issues I and others see with the course.

    It would be a 9 month or so season. Most people have no issues with playing on dormant warm season grasses and overseeding fairways is unheard of around here. You may find a handful of courses that will overseed the tee boxes but even that is rare and mostly kept to just par threes.

    The fact that it is really only nine months and if I had my druthers I would go bermuda greens is why I would want to really beef up the driving range and make it have some heated bays so there is still interest when the course is required to be closed.

  • cxxcxx Members Posts: 3,160 ✭✭✭✭✭✭✭

    @North Butte said:
    I'm not clear on what the OP is bringing to the table.

    It sounds like the pitch would be for "investors" to put up the money to let a person with no golf-industry experience run a golf course the way he wants to see one run.

    And all this for a course which has recently gone bust. How is that supposed to work out better for an amateur than it did for the people running it the first time around?

    Maybe he's going to sell the TV rights to the reality series.

  • smashdnsmashdn Let's cut them trees down. Members Posts: 1,347 ✭✭✭✭✭✭

    @North Butte said:
    I'm not clear on what the OP is bringing to the table.

    It sounds like the pitch would be for "investors" to put up the money to let a person with no golf-industry experience run a golf course the way he wants to see one run.

    And all this for a course which has recently gone bust. How is that supposed to work out better for an amateur than it did for the people running it the first time around?

    Desire. About it. I just really don't want to see a decent golf course mis-managed (that is clear at this point) and turned into a subdivision or otherwise not kept as a golf course. Will anyone make a killing off of it? Probably not. Could it be re-furbished and turned into a nice, fun course that fills a niche and offers golf? I hope so. That is all I really want. I am interested in running it as a golf course, with help, the right help, and the right expertise. I am smart enough to know what I don't know. And like I said, between my wife and I, we have proven business acumen, civil and environmental engineering backgrounds and I was a manufacturing engineer for seven years. I can build and fix things. I have in my background a history of serving as the PM on multi-million dollar factory construction jobs and equipment purchases. I was also interested enough about the business side of golf in college that I took turf grass courses as well as course management courses. It is not all greek when it comes to course management nor the capital side of things either. If it is meant to be it will be, if not it was a fun thing to spend a little time researching with my real estate agent and turned into a mostly productive and interesting three page discussion on GolfWRX.

    The pitch is, here is a course that is not so far gone it cannot be resurrected, but will take some investment in. I would get the list of what is necessary and what would be the nice-to-haves to drive revenue and have a 5-10 year plan for capital improvements as well as yearly expenditures budgeted. I think if you saw it in person and saw the disconnected nature of the facilities as well as the stupid size of the burned clubhouse it would be pretty evident that the people/person running it most recently had no idea how to stay solvent or run a golf business, much less than I would. It has a croquet lawn for goodness sake. It is not that much different than any other private club who made the mistake of over-extending themselves into debt and then having to turn semi-private or even public to pay the bills. The difference here is that it was not able to recover with the current owner to a functioning course. But then again I do not know what all steps he took before it was shuttered. Some folks are unwilling to do certain things and throw in the towel early.

    I appreciate all of the good advice you have offered though. Your opinion has been duly noted and I feel like I have a good handle on your stance on the venture. I'll make it a point not to bother you with a request to invest.

  • North ButteNorth Butte Members Posts: 10,965 ✭✭✭✭✭✭✭

    OK, so I did understand it correctly. Wow.

    “1lb beefstak, with
    1pt bitter beer
    every 6 hours.
    1 ten-mile walk every morning.
    1 bed at 11 sharp every night.
    And don't stuff your head with things you don't understand.” 
  • smashdnsmashdn Let's cut them trees down. Members Posts: 1,347 ✭✭✭✭✭✭

    @North Butte said:
    OK, so I did understand it correctly. Wow.

    You read it right. Hang around and add more to the wit and banter or now since you have it sleuthed out you can mosey on.

  • Jay ZGJay ZG Members Posts: 188 ✭✭
    edited Aug 8, 2019 7:49pm #78

    @DonatelloNobodie said:
    I did the research to develop a business plan to buy a bankrupt course a few years ago. No way to come even close to break even. No surprise that they went bust. Despite an amazingly low price that the lien-holder would take, I could not come up with a plan to even break even. I researched operating budgets of every local public and private course that I could get. At 1/3 debt service, 1/3 operating expense, and 1/3 fixed cost (insurance, rental equipment, utilities, etc), it came to about $1M annual expense. This was a very good public course in an area where relatively low cost taxes and maintenance existed, Clubhouse was very small and inexpensive to maintain.

    To offset that, it would require 20,000 rounds at $50 average. The course had nowhere near that level of play, and had a much lower average round cost. Food & beverage and pro shop sales were lucky to break even.

    Any capital improvements needed would only add to the expense number, and those were a big unknown without a lot of investigation expense.

    Land zoning was such that development for business or homes was not much of an option. Mostly flood plain, and picky local government.

    My advice would be to build a business plan. Review the course historical financials. Rounds played, average prices charged per round. Include any capital improvements needed. In your case, lack of a clubhouse is a big deal, requiring a lot of up front capital. A bad irrigation system would add staggering cost. Bunker improvements are also surprisingly costly – a lot more than just dumping in sand. $1 million in capital investment just to open is not uncommon.

    Look at US golf courses for sale. Lots on the market. Many at surprisingly low prices. A homeowners association near me is shopping for a course operator to reopen a closed course that initially was built for $20 million. They’re offering a $0 annual lease, yet are finding no takers. That says a lot about the golf business. I have a lot of respect for course owners that stay in business and wonder how some manage to do so. Most prospective golf course buyers today are developers looking for land that can be used for other purposes by closing the course.

    This guy gets it. If you want to make a small fortune buying bankrupt golf courses, start with a large fortune.

  • North ButteNorth Butte Members Posts: 10,965 ✭✭✭✭✭✭✭

    There are courses in my area there for the asking to anyone willing to take on outstanding loan obligations of as little as a few hundred thousand dollars. Because they are zoned in a way that will not let them be redeveloped as housing or commercial, there is no chance of finding buyers. They basically have negative value as golf courses, the upkeep and taxes are more expensive than any possible revenue stream. Been that way for a decade now.

    Eventually someone will find the political clout to "fix" the zoning thing and they will all be bulldozed in the blink of an eye.

    “1lb beefstak, with
    1pt bitter beer
    every 6 hours.
    1 ten-mile walk every morning.
    1 bed at 11 sharp every night.
    And don't stuff your head with things you don't understand.” 
  • duffer987duffer987 I'm old enough to remember a time when Ignore and Feedback worked. Canadian in CaliforniaMembers Posts: 9,356 ✭✭✭✭✭✭✭

    @smashdn said:
    I think if you saw it in person and saw the disconnected nature of the facilities as well as the stupid size of the burned clubhouse it would be pretty evident that the people/person running it most recently had no idea how to stay solvent or run a golf business, much less than I would. It has a croquet lawn for goodness sake.

    >
    That you are so continually hung up on such pedantic points as this and pin your hugely superficial research on these as an indicator of how it is 'pretty evident' previous owners 'had no idea' what they were doing, goes a long way to repudiating any notion of you bringing business acumen and 'knowing what you don't know' to the table.

    Call us negative nellys if you will, but why try and resurrect some dead (and really plain and boring looking) course?
    If we entertain this as anything more than just an - if I won the lottery fantasy - buy a plot of land for 9 and start from scratch. Bland dead golf courses don't come back from the dead, even compelling cool layouts don't as I am sure everyone in this thread could point to local well thought of tracks that couldn't survive.

  • dcmidnightdcmidnight Marshals, BST Volunteer Mods Posts: 12,116 mod
    edited Aug 8, 2019 8:20pm #81

    @smashdn said:
    I do not know what all steps he took before it was shuttered.

    Full. Stop.

    The fact that you are ignoring income streams like mini golf or the croquet lawn speaks volumes. A croquet lawn in the DC area would also be known as a ready made wedding platform, ready to rent out for the day to a wedding party and catering company. Basically free income. But to you its just "stupid". OK.

    In the Northern VA area there have been a handful of courses that have failed over the last 20 years. And if you were writing a business plan in this area, you'd note in your plan that by household per capita income, the DC/MD/VA area is the wealthiest area in the country. Which is only to say that if courses can fail here - they can fail elsewhere for a whole lot less. A failed Johnny Miller designed course had trouble selling for $1. Think about that. The HOA around the course eventually bought it for $1. In an area that financially can support just about anything this course failed for a number of reasons.

    You are getting a lot of good, free advice here for a venture that may or may not be 100% serious. Dont ignore it just because its not what you thought you were going to hear.

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  • JeffreySpicoliJeffreySpicoli Members Posts: 1,957 ✭✭✭✭✭✭

    The best way to turn a profit in this thread would be to bet against the OP if he somehow goes forward on this.

    However, it’s most likely this is simply building castles in the sky.

  • 2bGood2bGood Members Posts: 5,224 ✭✭✭✭✭✭✭
    edited Aug 9, 2019 7:03am #83

    @beckjg135 said:
    if this purchase gets made, i would love for you update us often, i would totally follow this journey,

    So would I, but if he does do this, he may no longer be able to afford the internet

    Post edited by 2bGood on
  • smashdnsmashdn Let's cut them trees down. Members Posts: 1,347 ✭✭✭✭✭✭

    With all due respect, this is Western KY and a croquet lawn in front of what would at best be a doublewide trailer for a clubhouse for a few years is not and will not be also known as a wedding platform. There is just not a culture of using the local country club for weddings. Not around here. Not to mention where it is located on the property is just not appropriate, it is very near a busy state highway.

    There is another club fairly local to me that nearly collapsed because it went the "clubhouse as a wedding/meeting venue route." They got overextended for the membership due to the giant clubhouse they built, did assessments to pay for it, lost members and spiraled further behind until they had to close and then re-open as a daily fee course under a different name.

    Then there is the club in town that everything is paid for, the clubhouse is modest in size but adequate for the membership, has an appropriate length course that has impeccable conditions and can be made harder or easier based on green speeds and rough length only. They continue to gain members because what they have to offer is what people are willing to pay for. They make modest improvements here and there when the budget allows and it is approved by the membership. That is the model I want to have. Pay as you go instead of crazy debt. That is the model that I think would work best given the location and the economics of the area. Granted I don't live there and can't know every bit of minutia about the socio-economics but from the average real estate of that particular county, the adjoining counties, the fact there is only one public course in those three counties I feel that there could possibly be a market for a solid public track with an above average practice facility. The public course here does as many buckets at the range as it does rounds.

    Definitely all of this is still under investigation. That I think is maybe a lost point in some of your replies. I know full well I don't know the answers I need to make a play for this thing. I am asking the questions so I can know what to ask so I will know. The "how would you fix this" is just a fun golf architecture nerd aside until the unknowns are better known.

    With all due respect, this is, and will likely only be a golf course at best. While it may work in northern VA or DC to expand your offerings to try and pull in additional revenue it all comes at a cost to be more things to more people, I really only would want it to be a golf club/course. The interest in those other things come and go. Topgolf right now is printing money. We could all rush out and turn a spare few acres into our own version of topgolf but in ten years is the demand going to be there? What little experience I have running and operating a golf course I have even less experience (and interest) in running a wedding/mini-golf/laser tag/foot golf/croquet venue. I like KISS. Do what you do and do that well. Have good conditions, a fast pace of play, easy bogey/hard par course with a variety of shots and angles and I think you have a winner anywhere there is a modest golfing population.

  • smashdnsmashdn Let's cut them trees down. Members Posts: 1,347 ✭✭✭✭✭✭

    @dcmidnight said:
    You are getting a lot of good, free advice here for a venture that may or may not be 100% serious. Dont ignore it just because its not what you thought you were going to hear.

    If I choose to take it the thread dies. Maybe I should I wait to see what the real estate agent can drag up? I have exactly zero dollars tied up so far. Walking away at this point seems premature.

  • farmerfarmer Members Posts: 8,083 ✭✭✭✭✭✭✭

    Completely second Donatello, with one proviso. Fill in the swimming pool. They are money pits and it will help with your liability coverage.

  • JeffreySpicoliJeffreySpicoli Members Posts: 1,957 ✭✭✭✭✭✭

    @smashdn said:
    With all due respect, this is Western KY and a croquet lawn in front of what would at best be a doublewide trailer for a clubhouse for a few years is not and will not be also known as a wedding platform. There is just not a culture of using the local country club for weddings. Not around here. Not to mention where it is located on the property is just not appropriate, it is very near a busy state highway.

    There is another club fairly local to me that nearly collapsed because it went the "clubhouse as a wedding/meeting venue route." They got overextended for the membership due to the giant clubhouse they built, did assessments to pay for it, lost members and spiraled further behind until they had to close and then re-open as a daily fee course under a different name.

    Then there is the club in town that everything is paid for, the clubhouse is modest in size but adequate for the membership, has an appropriate length course that has impeccable conditions and can be made harder or easier based on green speeds and rough length only. They continue to gain members because what they have to offer is what people are willing to pay for. They make modest improvements here and there when the budget allows and it is approved by the membership. That is the model I want to have. Pay as you go instead of crazy debt. That is the model that I think would work best given the location and the economics of the area. Granted I don't live there and can't know every bit of minutia about the socio-economics but from the average real estate of that particular county, the adjoining counties, the fact there is only one public course in those three counties I feel that there could possibly be a market for a solid public track with an above average practice facility. The public course here does as many buckets at the range as it does rounds.

    Definitely all of this is still under investigation. That I think is maybe a lost point in some of your replies. I know full well I don't know the answers I need to make a play for this thing. I am asking the questions so I can know what to ask so I will know. The "how would you fix this" is just a fun golf architecture nerd aside until the unknowns are better known.

    With all due respect, this is, and will likely only be a golf course at best. While it may work in northern VA or DC to expand your offerings to try and pull in additional revenue it all comes at a cost to be more things to more people, I really only would want it to be a golf club/course. The interest in those other things come and go. Topgolf right now is printing money. We could all rush out and turn a spare few acres into our own version of topgolf but in ten years is the demand going to be there? What little experience I have running and operating a golf course I have even less experience (and interest) in running a wedding/mini-golf/laser tag/foot golf/croquet venue. I like KISS. Do what you do and do that well. Have good conditions, a fast pace of play, easy bogey/hard par course with a variety of shots and angles and I think you have a winner anywhere there is a modest golfing population.

    You don’t know enough to be so confident that the solution here is cost management. Lots of businesses are ruthless in containing expenses and they still don’t turn a profit.

  • smashdnsmashdn Let's cut them trees down. Members Posts: 1,347 ✭✭✭✭✭✭
    edited Aug 8, 2019 9:46pm #88

    I agree with that assertion. I would also say that cost management certainly does not hurt the cause.

    I will make a point to go in the next couple of days and speak with a director of golf operations I am friends with that runs a public course. Get his take. I will also reach out to a super that is a friend for his take on budget and specific infrastructure items.

    Again, that doesn't get me specific answers about this particular course but until I can pin down the owner it is the best I can do to help get more educated.

  • gambitgambit Members Posts: 4,276 ✭✭✭✭✭✭✭

    OP - lots of excellent advice in regard to the course and business/financial side of things, but if the course goes under again for whatever reason can you survive from that?

  • North ButteNorth Butte Members Posts: 10,965 ✭✭✭✭✭✭✭

    @gambit said:
    OP - lots of excellent advice in regard to the course and business/financial side of things, but if the course goes under again for whatever reason can you survive from that?

    If he doesn't have his own money in it, sure.

    The challenge is going to be finding a sugar daddy who'll pony up a couple million and leave him to do things as he sees fit even though he has no skin in the game.

    “1lb beefstak, with
    1pt bitter beer
    every 6 hours.
    1 ten-mile walk every morning.
    1 bed at 11 sharp every night.
    And don't stuff your head with things you don't understand.” 
  • gambitgambit Members Posts: 4,276 ✭✭✭✭✭✭✭

    @North Butte said:

    @gambit said:
    OP - lots of excellent advice in regard to the course and business/financial side of things, but if the course goes under again for whatever reason can you survive from that?

    If he doesn't have his own money in it, sure.

    The challenge is going to be finding a sugar daddy who'll pony up a couple million and leave him to do things as he sees fit even though he has no skin in the game.

    Exactly. I can't imagine a scenario where he wouldn't have to put in a good chunk of cash whether he's got it already or through a loan.

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