The decline of the country club

[Roadking2003]

> @az2au said:

> Is it really still declining at the same rate though? I know for a fact of at least three clubs with waiting lists in our immediate area. One is 6-8 months, one is 12-14 months and I don't know the other one's estimated time but that's still not a sign of declining business when you have people on a waiting list with $50K+ initiations and >$1000/month dues at each. So, in some regions I'm sure that this is still the case but I think most of the shake out is over here in the near term (we'll hit another cycle eventually, I'm sure).

 

Good point. I've looked for some stats to form an opinion about this but can't find any.

[DrSchteeve]

> @az2au said:

> > @DrSchteeve said:

> > Warren Buffet has said (though he's probably not the originator) that you should pick a business to invest in that any idiot can run, because eventually one will. The declining golf business - especially private clubs - aren't that business. Sure, there are plenty of stories about how "management" screwed up the private club they are a member of, but it's a tough business model.

> Is it really still declining at the same rate though? I know for a fact of at least three clubs with waiting lists in our immediate area. One is 6-8 months, one is 12-14 months and I don't know the other one's estimated time but that's still not a sign of declining business when you have people on a waiting list with $50K+ initiations and >$1000/month dues at each. So, in some regions I'm sure that this is still the case but I think most of the shake out is over here in the near term (we'll hit another cycle eventually, I'm sure).

No question the higher end clubs will (almost) always do well...

 

 

[golfortennis]

> @az2au said:

> > @DrSchteeve said:

> > Warren Buffet has said (though he's probably not the originator) that you should pick a business to invest in that any idiot can run, because eventually one will. The declining golf business - especially private clubs - aren't that business. Sure, there are plenty of stories about how "management" screwed up the private club they are a member of, but it's a tough business model.

> Is it really still declining at the same rate though? I know for a fact of at least three clubs with waiting lists in our immediate area. One is 6-8 months, one is 12-14 months and I don't know the other one's estimated time but that's still not a sign of declining business when you have people on a waiting list with $50K+ initiations and >$1000/month dues at each. So, in some regions I'm sure that this is still the case but I think most of the shake out is over here in the near term (we'll hit another cycle eventually, I'm sure).

 

I think a lot of the "golf is dying" talk is coming from equipment manufacturers, club pros(of which there are too many), and administrators who were living high on the hog during the boom, and are not willing to give up the lifestyle. Sure there's been a contraction. Golf is essentially back to what it was before the boom. It will always be a niche sport. That is the thing that gets missed. The casual golfer who played during the boom because it was the thing moved on to triathlons/cycling in the late 00s early 10s, and are now moving on to the next thing.

 

Of course a private club is a tough business model. Whenever you rely on discretionary income, it's a tough thing. But it is not nearly as impossible as some make it out to be.

[golfortennis]

> @DrSchteeve said:

> > @az2au said:

> > > @DrSchteeve said:

> > > Warren Buffet has said (though he's probably not the originator) that you should pick a business to invest in that any idiot can run, because eventually one will. The declining golf business - especially private clubs - aren't that business. Sure, there are plenty of stories about how "management" screwed up the private club they are a member of, but it's a tough business model.

> > Is it really still declining at the same rate though? I know for a fact of at least three clubs with waiting lists in our immediate area. One is 6-8 months, one is 12-14 months and I don't know the other one's estimated time but that's still not a sign of declining business when you have people on a waiting list with $50K+ initiations and >$1000/month dues at each. So, in some regions I'm sure that this is still the case but I think most of the shake out is over here in the near term (we'll hit another cycle eventually, I'm sure).

> No question the higher end clubs will (almost) always do well...

>

>

 

So the question becomes what is wrong with the others? Golf being a business like any other, I will be the first to admit that while I like the fact there are a large number of courses in an area, if you shouldn't have built the course in the first place, that's a poor decision. If 10 golf courses per 100,000 people is the proper number(I have no idea, just using it as a talking point), then if you come in and build the 11th course, you're already on thin ice. If there is an established high end club in the area, and you want to be private, you cannot try to compete at their level, while trying to draw those of lesser means(relatively). Unless there is such a large contingent of higher income that the existing club doesn't have room, you either need to poach those members, or lower the expectations.

 

But the expectations are part of the issue as well, in general. When I was first playing, I played on what I would now refer to as cow pastures. But I didn't know any better at the time, so they were fine for me. But too many courses work so hard to be a "championship" course, or "country club for a day", that they have totally skewed things. The places I was referring to, I could play for $20 back in the day. Now people see one of these wow courses, and decide whether to play 5 times at the first place, or once at the wow course. While the wow course may have some things that justify the wow, the better way to get someone to become a long term golfer is to play the 5 times with that money.

[Roody]

> @Bluefan75 said:

> But the expectations are part of the issue as well, in general. When I was first playing, I played on what I would now refer to as cow pastures. But I didn't know any better at the time, so they were fine for me. But too many courses work so hard to be a "championship" course, or "country club for a day", that they have totally skewed things. The places I was referring to, I could play for $20 back in the day. Now people see one of these wow courses, and decide whether to play 5 times at the first place, or once at the wow course. While the wow course may have some things that justify the wow, the better way to get someone to become a long term golfer is to play the 5 times with that money.

 

I guess it's just the particular financial mindset of each golfer. For me, playing the wow course is totally worth it. In my mind it's not something I do every day, and it's an experience.

 

I've played Pebble, Sawgrass, Kiawah for starters, and I'm happy to shell out the $300-$500 because those were great experiences that I will have in memory for the rest of my life. I also make a point to get out to play Turning Stone's courses at least once a summer because I love the courses, and it's worth the money IMO. Conversely, I have a couple of friends who completely scoff at the idea of paying that much for one round of golf. Their mindset is "but for $500 I could play 10 rounds at Local CC!!". For them they value quantity over quality.

 

It really is about "perceived value". Everyone has a different idea about it. And that's ok.

 

 

[Golfnuck]

> @az2au said:

> > @DrSchteeve said:

> > Warren Buffet has said (though he's probably not the originator) that you should pick a business to invest in that any idiot can run, because eventually one will. The declining golf business - especially private clubs - aren't that business. Sure, there are plenty of stories about how "management" screwed up the private club they are a member of, but it's a tough business model.

> Is it really still declining at the same rate though? I know for a fact of at least three clubs with waiting lists in our immediate area. One is 6-8 months, one is 12-14 months and I don't know the other one's estimated time but that's still not a sign of declining business when you have people on a waiting list with $50K+ initiations and >$1000/month dues at each. So, in some regions I'm sure that this is still the case but I think most of the shake out is over here in the near term (we'll hit another cycle eventually, I'm sure).

 

At some point it should get back to economics and the concept of "supply and demand".

 

My club is not a "high end" club but we are situated in a rapidly growing area with lots of density and affluence. Our regional area has approx. 2.5 million people and our club is eastern most of the top 5 clubs in the area. In total there are 10 private golf clubs in the area within 60 miles of Vancouver.

 

One of the top clubs is going to close in 2032 (it is on leased land and the lease will not be renewed).

 

We currently have over 70 on the full play waitlist and it continues to grow ?????

 

In addition to full play we have waitlist in two other playing categories.

 

I suspect it will be close to 5 to 8 years before the 70th person will be able to join.

 

Two of the other private clubs have waitlists of over 50 members.

 

Initiation fees for all the clubs with waitlist is over CAD$50k with the highest being CAD$96k.

[golfortennis]

> @Roody said:

> > @Bluefan75 said:

> > But the expectations are part of the issue as well, in general. When I was first playing, I played on what I would now refer to as cow pastures. But I didn't know any better at the time, so they were fine for me. But too many courses work so hard to be a "championship" course, or "country club for a day", that they have totally skewed things. The places I was referring to, I could play for $20 back in the day. Now people see one of these wow courses, and decide whether to play 5 times at the first place, or once at the wow course. While the wow course may have some things that justify the wow, the better way to get someone to become a long term golfer is to play the 5 times with that money.

>

> I guess it's just the particular financial mindset of each golfer. For me, playing the wow course is totally worth it. In my mind it's not something I do every day, and it's an experience.

>

> I've played Pebble, Sawgrass, Kiawah for starters, and I'm happy to shell out the $300-$500 because those were great experiences that I will have in memory for the rest of my life. I also make a point to get out to play Turning Stone's courses at least once a summer because I love the courses, and it's worth the money IMO. Conversely, I have a couple of friends who completely scoff at the idea of paying that much for one round of golf. Their mindset is "but for $500 I could play 10 rounds at Local CC!!". For them they value quantity over quality.

>

> It really is about "perceived value". Everyone has a different idea about it. And that's ok.

>

>

 

And that is fine. The big difference is, you are on wrx. You're committed to this game(or if you're like the rest of us, should be committed.... ba domp bomp). You're going to play golf. I'm talking about the people for whom it's an either/or thing. I'm all for places like you mentioned, and what they bring to the table. But from the perspective of getting people playing this game, they are the worst places.

 

Reason 1: Suppose the person has a day like you seem to have had. Great, but now anything else they play is going to look horrible in comparison, which may well lead to passing on playing the local muni. Yes you hit that one shot that gets you hooked, but you need to play this game with some frequency to really get into it.

Reason 2: They're out $300-$500. Given golf's penetration in the upper incomes, most newbies are the type where this is a bite.

Reason 3: What if the day at the places you mention goes bad? For whatever reason. They've heard about how it's so great, and this is one of the best things golf has to offer, and.... it's a disaster. Not only are they out the money, what is supposed to be great sure doesn't look like it to them. Where did you say the rock climbing was?

Reason 4: In many cases, these courses are also not set up as members courses. By which I mean, you can hit a ball off line, and in most cases be reasonably certain you will find it. It may be taking par out of the picture, but you find the ball. A number of the courses have the wow factor due to views etc., but it also means that not too far off the fairway = reload due to a lost ball. Maybe it's staked, but still, constantly losing balls is quite demoralizing.

 

Certainly to each his own, but I think the wow courses have really skewed the perceptions and given the wrong idea to a lot of people. Learn the game on an executive course, play a muni until you're really committed. I think that is the way to really get people to stick with the game. It's hard enough to begin with, why start on the most expensive, and typically very difficult courses?

[North Butte]

> @Bluefan75 said:

> > @Roody said:

> > > @Bluefan75 said:

> > > But the expectations are part of the issue as well, in general. When I was first playing, I played on what I would now refer to as cow pastures. But I didn't know any better at the time, so they were fine for me. But too many courses work so hard to be a "championship" course, or "country club for a day", that they have totally skewed things. The places I was referring to, I could play for $20 back in the day. Now people see one of these wow courses, and decide whether to play 5 times at the first place, or once at the wow course. While the wow course may have some things that justify the wow, the better way to get someone to become a long term golfer is to play the 5 times with that money.

> >

> > I guess it's just the particular financial mindset of each golfer. For me, playing the wow course is totally worth it. In my mind it's not something I do every day, and it's an experience.

> >

> > I've played Pebble, Sawgrass, Kiawah for starters, and I'm happy to shell out the $300-$500 because those were great experiences that I will have in memory for the rest of my life. I also make a point to get out to play Turning Stone's courses at least once a summer because I love the courses, and it's worth the money IMO. Conversely, I have a couple of friends who completely scoff at the idea of paying that much for one round of golf. Their mindset is "but for $500 I could play 10 rounds at Local CC!!". For them they value quantity over quality.

> >

> > It really is about "perceived value". Everyone has a different idea about it. And that's ok.

> >

> >

>

> And that is fine. The big difference is, you are on wrx. You're committed to this game(or if you're like the rest of us, should be committed.... ba domp bomp). You're going to play golf. I'm talking about the people for whom it's an either/or thing. I'm all for places like you mentioned, and what they bring to the table. But from the perspective of getting people playing this game, they are the worst places.

>

> Reason 1: Suppose the person has a day like you seem to have had. Great, but now anything else they play is going to look horrible in comparison, which may well lead to passing on playing the local muni. Yes you hit that one shot that gets you hooked, but you need to play this game with some frequency to really get into it.

> Reason 2: They're out $300-$500. Given golf's penetration in the upper incomes, most newbies are the type where this is a bite.

> Reason 3: What if the day at the places you mention goes bad? For whatever reason. They've heard about how it's so great, and this is one of the best things golf has to offer, and.... it's a disaster. Not only are they out the money, what is supposed to be great sure doesn't look like it to them. Where did you say the rock climbing was?

> Reason 4: In many cases, these courses are also not set up as members courses. By which I mean, you can hit a ball off line, and in most cases be reasonably certain you will find it. It may be taking par out of the picture, but you find the ball. A number of the courses have the wow factor due to views etc., but it also means that not too far off the fairway = reload due to a lost ball. Maybe it's staked, but still, constantly losing balls is quite demoralizing.

>

> Certainly to each his own, but I think the wow courses have really skewed the perceptions and given the wrong idea to a lot of people. Learn the game on an executive course, play a muni until you're really committed. I think that is the way to really get people to stick with the game. It's hard enough to begin with, why start on the most expensive, and typically very difficult courses?

 

And there is this to consider...

 

I spent my first decade playing regularly at a course right down the street from my house that, honestly, was not very good at all. Guy built the course on his own farmland by just pushing up greens and scraping out fairways however with no particular design in mind. So lots of very similar, boring holes, wide open, few hazards, tiny little greens with no internal contours. And the maintenance was about what you'd expect for a course that's $20 with cart on weekends.

 

When I joined and started playing at a decent country club, it took me years to take the conditions and the quality of the course for granted. Then I moved up to an even better country club course (where I still play) whose design suits me as well as anything short of Cypress Point or Augusta National. Just a wonderful place to play golf.

 

When I play the local muni course or, god forbid, that course out in the sticks where I learn to play the conditions and lack of interest just drive me nuts. I don't know how long I'd have to play at a place like that before it quit seeming like a waste of a perfectly good afternoon. My expectations have gotten ratcheted up to the point where even a perfectly adequate middle-of-the-road public course seems scruffy and lackluster. I kind of hate that it happened but there it is. If I ever lost the financial means to play nice private courses it would one hell of a re-adjustment. Not that I'd quit but I'd be pretty frustrated.

[burnsniper]

^^^to add to the above although somewhat OT; Golf is really the only sport that gives the opportunity to basically everyone to play on the same field as the greatest players. Anyone can spend $380 and play Kiawah or $500 and play Pebble. Not just anyone can go shoot hoops at the Garden or take batting practice at Fenway.

[Roadking2003]

> @Bluefan75 said:

> So the question becomes what is wrong with the others? Golf being a business like any other, I will be the first to admit that while I like the fact there are a large number of courses in an area, if you shouldn't have built the course in the first place, that's a poor decision. If 10 golf courses per 100,000 people is the proper number(I have no idea, just using it as a talking point), then if you come in and build the 11th course, you're already on thin ice. If there is an established high end club in the area, and you want to be private, you cannot try to compete at their level, while trying to draw those of lesser means(relatively). Unless there is such a large contingent of higher income that the existing club doesn't have room, you either need to poach those members, or lower the expectations.

>

> But the expectations are part of the issue as well, in general. When I was first playing, I played on what I would now refer to as cow pastures. But I didn't know any better at the time, so they were fine for me. But too many courses work so hard to be a "championship" course, or "country club for a day", that they have totally skewed things. The places I was referring to, I could play for $20 back in the day. Now people see one of these wow courses, and decide whether to play 5 times at the first place, or once at the wow course. While the wow course may have some things that justify the wow, the better way to get someone to become a long term golfer is to play the 5 times with that money.

 

Given a little time, the market will sort this out. It always does.

[raynorfan1]

> @Roadking2003 said:

> Given a little time, the market will sort this out. It always does.

I'm not so sure that's true. One of the issues with golf courses is that they are big investments with long time horizons, and the market can (and does) change more rapidly than a lot of clubs/courses can react.

 

In my area (Greater Boston) we've gone - in less than ten years - from clubs teetering on the edge of insolvency (including some in the Golf Digest Top 100) to long waiting lists and selective membership policies. I'm sure it will swing back at some point...

[North Butte]

If we're talking about building new courses (which is a virtually defunct activity in USA nowadays, outside of high-end resorts and rich guy second clubs) then we're never again going to see $20/round courses being built. Unless the course is built way out in the sticks where land isn't expensive and by some miracle the construction could be done for maybe $50,000 per hole (roughly a million dollars for a 18-hole course, plus the land) and future maintenance is done on a shoestring budget, the income stream from $20 rounds just won't cover the cost with any reasonable return. And those numbers are pipe dreams, modern putting greens cost more then $50,000 apiece before you even build the course from tee to green or start installing irrigation and drainage.

 

The only place people are going to play golf for $20 or $30 or even $40 a round today are ones where either the land acquisition and construction are long since paid off or there's some sort of subsidy from a residential development or local government. In the rare cases where someone buys a tract of land and builds a golf course from scratch, hoping for a return on investment, it absolutely has to be in a much higher per-round revenue bracket.

[burnsniper]

> @"North Butte" said:

> If we're talking about building new courses (which is a virtually defunct activity in USA nowadays, outside of high-end resorts and rich guy second clubs) then we're never again going to see $20/round courses being built. Unless the course is built way out in the sticks where land isn't expensive and by some miracle the construction could be done for maybe $50,000 per hole (roughly a million dollars for a 18-hole course, plus the land) and future maintenance is done on a shoestring budget, the income stream from $20 rounds just won't cover the cost with any reasonable return. And those numbers are pipe dreams, modern putting greens cost more then $50,000 apiece before you even build the course from tee to green or start installing irrigation and drainage.

>

> The only place people are going to play golf for $20 or $30 or even $40 a round today are ones where either the land acquisition and construction are long since paid off or there's some sort of subsidy from a residential development or local government. In the rare cases where someone buys a tract of land and builds a golf course from scratch, hoping for a return on investment, it absolutely has to be in a much higher per-round revenue bracket.

 

Sand Hills total cost (including land) was under $2.2 MM:

 

https://www.linksmagazine.com/viewpoint_minimalism/

 

As a developer (not golf focused), it’s all about smarter/sustainable development and understanding of markets. The housing bubble plus baby boomer retirement drove record numbers of private golf communities and the demand was/is just not there to support these courses. Same could be said about the Southen Florida condo market. Developers have a tendency to always chase short money and that has been mostly disasterous in golf development.

 

Also, NY, LA, and SF may be in a real estate bubble now that is being held up by foreign investment (which has not shown huge interest in golf development to my understanding) and if that source dries up/becomes saturated it may collapse these markets which could pull the whole economy down with them.

 

 

[Schley]

We made it through the year it appears so how is the state of the CC now?

 

Just saw a new private club in Bangkok, Thailand called Ballyshear Links designed by Gil Hanse which will open in January of 2020. They seem to think they can get 300 members there and it looks very, very good indeed. A homage to CB McDonald template holes in a true links style (although no ocean).

[theredzone7]

Sad day when this happened!

[Pepperturbo]

There are known reasons why over the last thirty years wall-street driven businesses ladened with red ink can't turn red into black ink. One is the people behind the red-ink can't see their way and or are not willing to do what it takes to turn it around, as they are too influenced by established relationships. Consequently, the growing answer has been to abruptly remove the current leader and put in place an effective turn-around specialist. Not a practical option for golf courses but could be if making a profit is the end-all-be-all desire of the owner(s).

[Pepperturbo]

Having chaired membership committees and been on two BOD of private clubs, most people with established financial resources seeking to join a club are not bargain hunters; typically they seek a fitting club culture. Bargain hunters are people that, for the most part, should think twice as to whether or not they can really afford the cost of a private club membership. Reason we use to look heavily into a potential members finances. Making a costly mistake by joining a club and leaving a year or two later isn't what either party wants, besides both parties lose money. The problem is when someone's lifestyle is derogatorily affected when a clubs increased operational costs are passed on to membership through increased dues or lump-sum assessments. It's money they don't have that too often on top of other debt, requires financing.

[bobbydoestrong]

I’d join a good private club if possible, but as a nurse making less than six figures it would be extremely difficult to put into my monthly budget. I praise those that enjoy the country clubs and I hope to join you one day.

[cardoustie]

hey @Golfnuck
Amazing Shaughnessy will close. Have a few buds that play there and I played the Cdn Mid Am there way back in the day ... they converted it to a par 70 from 73. Rock hard greens and high rough, it was beastly
Fellow Canuck here. Amazing what we pay for golf and housing being in the Vancouver and Toronto markets. Especially here with a 7 month season
thanks for the update on your area. I love the Van courses and have played VGCC quite a bit with a close friends uncle

[The_Real1]

I just joined my local club, The Oaks at Valencia. It's the old TPC Valencia course that hasnt been changed yet - I love it.