The Masters

Land Grab

Why Augusta National dropped $8.3 million on a parking lot, part of a 15-year spending spree that is remaking the club

April 2014

Masters champion Billy Casper famously said: "Golf puts a man's character on the anvil and his richest qualities—patience, poise, restraint—to the flame."

This might also be said of Augusta National Golf Club's slow and measured acquisition of property just outside its storied green gates.

For the past 15 years, Augusta National has been buying property—house by house, lot by lot—in the neighborhoods directly to the north, east and west of the 365-acre club. According to Golf Digest's analysis of sales records from 1999 through early 2014, limited-liability companies associated with the club have paid roughly $55 million and acquired about 100 acres.

True to form, Augusta National has been discreet about its acquisitions and tight-lipped about its master plan. It does say, however, that the club's legacy is to make improvements every year.

"If this were any other golf club, clearly this would be an expansion," says Jeff Woolson, managing director of the golf and resort division for CBRE, a global real-estate firm. Under the typical business model, he says, the development plan might include luxury lodging, high-priced homes and other revenue-generating amenities.

Of course, Augusta National is anything but typical. "This is the most profitable and the most liquid club on the planet," says Peter Nanula, chairman of Concert Golf Partners, a private equity firm that buys and operates golf properties. The Masters Tournament, which the club has hosted since 1934, is said to bring in hundreds of millions of annual revenue from television, ticket sales and licensed goods.

"They have a lot of revenue coming in for a club with very deep-pocketed members," Nanula says. "They don't need a dime of anybody's money, and they aren't trying to create wealth and divvy it up."

With money as no object, then, what does Augusta National have planned?

Golf Digest posed this question to locals and golf-industry experts, and heard a similar refrain: "It wouldn't shock me that they're buying property simply to create a buffer," says John Evans, a senior appraisal specialist at GE Capital Real Estate.

Yet, recent expansions and improvements suggest there might be more to Augusta National's plan than adding parking and fortifying the club's boundary. "What makes the National the National is the mystique," says one Augusta real-estate agent who asked to not be named. "They want to circle their wagons so those on the outside are truly on the outside. They don't like the riffraff. Pretty soon it's going to be members, their guests and corporate sponsors, with all their housing and food needs taken care of inside those gates."

Augusta National's improvements over the past several years give some credence to this theory of a self-contained campus. Though the land acquisitions began under former chairman Hootie Johnson, the plan has begun to take shape in the past several years under current chairman Billy Payne.

In 2010, the club opened a world-class practice area on what had been a gravel parking lot. Patrons were directed to a pastoral parking area on a huge swath of land the club had acquired in the Berckmans neighborhood to its west. (Relocating the media center, now bordered by the first hole and the lucrative merchandise area, also would open up valuable real estate.)

William Hatcher

Bought at $25,500, sold at $960,000: In 2010,
William Hatcher was one of the holdouts in the
Berckmans Road parking lot before selling his
home in 2013.
Photo: J.D. Cuban

Although Masters parking in the Berckmans lot is free, the land cost the club more than $40 million and drove up the value of the houses—most of them modest and built in the 1950s—to many times their market value. Augusta National, or its representatives, began talking with homeowners in the late 1990s. Locals say Augusta National did everything above board, never pressuring owners to sell. Early in the process, says one source, the club agreed to let owners stay in the property rent-free—in some cases until death. By some accounts the club also offered Masters badges in exchange for sellers' discretion.

In time, the houses came down, leaving room to hold 8,500 vehicles. "They have bought the bulk, if not all of those homes," says Lili Youngblood, past president of the Greater Augusta Association of Realtors. "It's just green space."

Though there was some grumbling from homeowners over the years, most were happy to sell. Understandably. The median sale price in Augusta was recently less than $100,000, with nicer homes near Augusta National selling for a median of about $180,000. Houses located on or near what is now Augusta National's main parking lot sold for a median of $1 million. In early 2013, for example, a 1,200-square-foot home with three bedrooms and one bathroom sold for $1.2 million. Around the same time William Hatcher—a homeowner who in 2010 told Golf Digest he wasn't interested in selling despite being one of the few houses still standing in his old neighborhood—sold his three-bedroom house for $960,000; he paid $25,500 for the house in 1973, according to property records.

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