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Membership Group Buys Stone Eagle

Saturday, April 3, 2010 Comments
Stone Eagle, in Palm Desert, Calif., has been saved. The details are in this story in The Desert Sun.

The private 18-hole club, featuring the only Tom Doak-designed course in the Palm Springs area, has been shut down for about a month, and in foreclosure since the beginning of the year. But 14 people -- seven couples, six of them members at Stone Eagle -- have bought the club for cash. The story doesn't include a price, but recent reports said a larger group of club members was trying to raise $12 million to buy it.

Stone Eagle opened in 2005. Memberships cost $100,000, and the story claims the club had 190 members at the time of the foreclosure. The new ownership group has made no announcement regarding membership structure in the future. But local officials are just pleased the club has a future.

From the story: "The purchase and reopening of the club provides some much-needed good news for golf courses in the valley, which have been hit with dwindling membership and a drop in players as a result of the recession. 'It's terrific for the whole desert,' said Tom Cullinan, general manager at Stone Eagle. 'Golf is our lifeline.' "

-- G.R.
Posted by Geoff Russell
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Arizona Update: 'Getting Hit From All Sides'

Wednesday, January 6, 2010 Comments
The Arizona Republic starts the new year with an update on the overall golf market in Phoenix and the surrounding suburbs. In summary: golf course owners and developers aren't noticing any rebound, at least not yet. Some, uh, highlights:

Many private clubs have opened their courses to the public, even for just one or two days a week, in an effort to increase rounds and revenue.

Many facilities are negotiating green fees. One golfer talks about having played the Arizona Biltmore for $55, and guesses it would have cost him twice that much a year ago.

Arizona officials estimate that "only" 5 percent of the state's approximately 340 golf facilities are in dire economic condition, compared to 15 percent nationally.

The story said there were no golf course residential developments opened in Arizona in 2009 -- startling news (economic troubles notwithstanding) considering how "white hot" the state's golf market was as recently as five years ago.

You can read the complete story here.

-- G.R.


Posted by Geoff Russell
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The Meaning of a Strong Golf Club Market

Tuesday, October 6, 2009 Comments
Are golf club memberships a reliable indicator of overall economic health?

We've written on this blog throughout the year of the downturn in the private golf club market in both the United States and the United Kingdom. But here is the other side of the spectrum: Officials in South Korea report an uptick in the market for golf club memberships, and say that is one of the surest signs of that country's emerging economic recovery.

Details are in this story from Bloomberg.

-- G.R.
Posted by Geoff Russell
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Nancy Berkley on the FedEx Cup and Liberty National

Monday, August 31, 2009 Comments
As I was following the coverage of the Barclays, the first event in the PGA Tour's Playoffs schedule, I was particularly intrigued by the "Deeds & Weeds" related angle: the host site, the very private Liberty National GC, which cost $250 million to build, charges a $500,000 initiation fee and (according to some reports) needs at least another 100 members in order to become financially healthy.

I thought about trying to write something up summarizing this side of the story. But then I read this column by Nancy Berkley's on Cybergolf.com and decided she had already done it for me.

-- G.R.
Posted by Geoff Russell
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Skibo Castle Goes Into the Red

Friday, August 21, 2009 Comments
Skibo Castle, the lavish private golf club and sporting retreat near Dornoch, Scotland -- once part of the private club empire of Peter de Savary and probably best known for hosting Madonna's 2000 wedding to film director Guy Ritchie -- is now losing money, according to this story in The Herald. The cause, of course, is the recession and its effects on the economy, particularly the high-end travel and resort industry, in which Skibo Castle resides.

According to the article, "[Skibo Castle] ... posted an operating loss of £13,000 for the year to the end of March, compared with an underlying profit of £169,000 the year before. At the pre-tax level, the situation grew even more bleak, as losses deepened to £1.03m, compared with a loss of £648,000 last time."

In 2007 Skibo claimed to have reached its membership goal of 500, each of whom paid £23,000 to join, plus annual dues of £7,000. But according to The Herald story, Skibo is accepting applications for membership, indicating it is operating at less than capacity. The story also says Skibo's currently has 183 full- and part-time employees, about 20 below normal levels. 

Skibo's general manager, Peter Crome, wouldn't comment on the facility's financial state, but insisted the long-term outlook for Skibo Castle remains rosy. "In spite of the challenging environment -- and we expect this current year to be challenging also -- we are quite confident about the future," he told The Herald. "We're carrying on happily."

-- G.R.
Posted by Geoff Russell
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Wheeling and Dealing in Richmond

Sunday, August 2, 2009 Comments
Read many of the stories about private golf clubs these days, and you would think they were a dying breed. Then you read an article like this, from Thursday's edition of the Richmond, Va., business publication Richmond BizSense, and you realize maybe the only thing about golf clubs that's dying is the old way of doing business.

The story gives a positive overview of a number of clubs in the Richmond and northern Virginia area that have managed to maintain -- and in some cases even increase -- their memberships through a variety of creative and flexible marketing programs. Among the deals: a waiver of initiation fees in exchange for a two-year commitment to membership; two memberships for the price of one initiation fee; and membership in two different clubs for the price of one initiation fee.

Stonehenge G&CC, which normally charges a $4,000 initiation fee, recently started a "Refer a Friend" program. Two individuals or two families can join at the same time and split the $4,000 initiation fee. Mike Cooke, Stonehenge's membership director, said the program has helped keep the club's membership at 490, just 30 shy of capacity.

"I don't think we're ever going back to 20 or 25 years ago, when people would stand in line to get into clubs because we had something that was very difficult to access," said Michael Persinger, the membership and marketing director at Meadowbrook CC, another of the clubs profiled in the article. "The competition is stiffer for the golfing dollar, the pool dollar and the tennis dollar."

--G.R.

Posted by Geoff Russell
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Golf's Economic Woes Make the CBS News

Saturday, June 6, 2009 Comments
Looking for proof that the golf economy is actually struggling? On Saturday's edition of the CBS Evening News, correspondent Jeff Glor filed a story about that very subject, focusing mostly on The Hamlet G&CC on Long Island. You can watch the video (and read a transcript of the report) here.

-- G.R.
Posted by Geoff Russell
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Bonita Bay Group Troubles Worsen

Thursday, May 21, 2009 Comments
The financial struggles of Bonita Bay Group continue. As this story in today's Naples Daily News reports, the company's CEO is resigning, four of its golf courses are about to shut down for the entire summer to save costs, and seven more courses may get taken over by their members.

"Company officials confirmed Wednesday that Kitty Green resigned as president and CEO of the Bonita Bay Group as it continues to fight off bankruptcy," says the story. "The award-winning developer, headquartered in Bonita Springs, is in financial turmoil. Lenders have required the company to hire a crisis manager to conserve cash and restructure operations."

Three weeks ago in Deeds & Weeds, we reported on a plan in which golfers could buy a membership at one of four Bonita Bay Group facilities (the four were Bonita Bay, Shadow Wood, Verandah and TwinEagles) and then enjoy playing privileges at the other three. The cost was $25,000. Clearly, it wasn't enough to pull the company out of its tailspin.

-- G.R.
Posted by Geoff Russell
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Tough Times in Ohio

Sunday, May 10, 2009 Comments
From Sunday's Columbus Times-Dispatch, a story on the local golf market. I'm afraid to say it's another version of a familiar story: In Ohio, as in most states, golf isn't as popular in 2009 as it was in, say, 1999. As a result, business is suffering.

Lots of stories like this one:

"You used to have tee times booked, people teeing off from first daylight to 4 in the afternoon, then twilight after that," said John Whittle, the head professional at Thorn Apple CC in Galloway. "You'd have people coming out 12 straight hours. It's not that way anymore."

Or this one:

"It's a sad situation," said Jim Long, who owns three public courses in Ohio, including Indian Springs GC near Mechanicsburg in Champaign County. "I've been a golf course owner for 28 years, and in the 1990s golf was it. Now, I've had to sell some warehouses to keep making payments on golf courses."

-- G.R.
Posted by Geoff Russell
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Trump Sets New Fees at Lowes Island

Thursday, April 30, 2009 Comments
In February, Donald Trump added to his golf course portfolio by buying the Lowes Island Club, a 36-hole private club on the banks of the Potomac River in Loudon County, Va., for $18 million. At the time, the real estate tycoon -- in his own inimitable fashion -- promised big improvements for Lowes Island, including renovations of both courses originally designed by Tom Fazio and Arthur Hills), and the staging of significant tournaments there, perhaps even a PGA Tour stop.

"This place, when it's finished, will be the finest club anywhere in the country," Trump promised. "There will be nothing like it. I already own the best ones, so I know."

Of course, with Trump and all of this investment comes a new price structure. This week Lowes Island members -- both present and perspective -- got a hint of what the new fees will be, during a visit to the facility by Trump and his associates. According to this story in the Washington Post, golf memberships there will now go for $75,000; corporate memberships will be $175,000; and social memberships (no golf) will cost $25,000.

-- G.R.

Posted by Geoff Russell
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