A colleague of ours, Golf Digest International Editor-in-Chief John Barton, attended last week's KPMG Golf Business Forum at the Celtic Manor Resort in Wales (the host site of the 2010 Ryder Cup). The agenda included a panel discussion on the current economic downturn entitled "Riding Out the Storm." Barton sent us the following report:
The 250 attendees (including course owners, developers, builders, architects and marketers, approximately 20 percent of whom were from the U.S.) were polled on the question, "How has the financial and economic meltdown impacted your business?" The results: severely, 34.3 percent; moderately, 46.5 percent; not at all, 9.1 percent; have benefited, 10.1 percent.
Then the attendees were asked, "When will the recovery happen?" The results: it's already started, 4.5 percent; end of 2009, 15.3 percent; mid-2010, 37.8 percent; end of 2010, 28.8 percent; 2011 or later, 13.5 percent.
One of the panel members was Dr. Joe Beditz, the CEO of the National Golf Foundation. Beditz told the audience the NGF is forecasting a 3-5 percent drop in rounds played in 2009 (even though rounds played were slightly up in the first quarter of the year).
He also reported that more than 400 private clubs in the U.S. changed their status in 2008 to become public. "It makes sense when you consider that this is a more attractive option than having to close down the whole operation due to a reduction in private members," said Beditz.
Finally, Beditz estimated that 10-15 percent of U.S. golf facilities currently have negative cash flows -- which he said means, "There are phenomenal buying opportunities for investors in the U.S. right now."