Golf development frustration....

[Mike_Young]

I just played a new signature course in the Atlanta area and walked away completely puzzled at what people now expect from a golf course.
There were several rides of over 400 yards between holes and ingress and egress to several of the holes were via very narrow downhill slopes.  The bunkers were severe and expensive to maintain and each green came with a fan.  Maitenance was excellent and excessive.  No house was priced under 1 million and most exceeded 2 million.
It is frustrating to continue to see such projects when you know that the average player cannot play it, the developer cared nothing for the golf itself, only for the marketing and status it provided.
These types of projects are destroying golf as a game.  When the developer is finished with the sale of homes and either sells the project or gives it to the membership they will have their hands full.
But the main thing that continues to amaze me with these types of peojects is the complete lack of routing, whether it be the landplanner or the golf architects.  The continuity of these courses is non existant and the soul of the course is just missing.  Do golfers no longer value a routing.
What do you guys think will be the lifespan of these type of projects.  While I am sure it will receive some "best new " awards.  It will not stand the test of time nor will many others that we continue to build in this manner.
 

[Craig Sweet]

We have a little project out here in Montana...not the East Missoula course...with housing going in around the golf holes and from what I hear, the deal is, if the course goes belly-up the homeowners in the development will then own the course...it will be their problem and not the original developers.

It just plain sucks...and by the way...I really wish the East Missoula course (Canyon River) didn't have to have a housing component.

[W.H. Cosgrove]

I don't think that this is new.  Developers build the course and take the profits out of the project in the form of the lot sales.  Then the lot owners/members receive the course through a purchase or transfer of some sort.  These new owners are now in the position of operating a business they neither understand nor have the time to market.  Over time the membership is diluted by the sale of the homes to owners who have no interest in belonging to the club.  

These owners eventually break into factions with varying agendas and through natural forces the club struggles to be all things to all people.  In so doing the club eventually implodes.  No harm to the developer, they are long gone.  

My club is in its 40th year, loses money and sits on real estate worth 4-5 times the value of the club.  Any bets on the chances for long term survival as it now exists?

[RJ_Daley]

Mike, Ironically I had the HGTV channel on in the background as I read your post.  The program was more or less about what incriments of $100K values and what that buys around the country up to a million.  

It seems it is all about real estate wild speculation that seems to be working out quite well for a lot of people.  The courses obviously are built to give the market the initial sizzle.  These people that are trading the trophy golf course home market, don't seem to be interested in settling down and actually living in these joints for a long long time.  They are all about turning it over for fast equity cash.  And, the speculative frenzy seems to me to be the same as Greenspan called irrational exhubrance some years ago about stocks.  

When the real estate thing busts, so will these course developments, I believe.  And, I think it won't be pretty.  But, I am sometimes described as a vortex of sucking negativity.    So, maybe I'm all wrong...

[Mike_Young]

The other problem is most of these people that join will quit the game because it is not the game with what most of us are familiar.  So it also affects golf longterm.

[RJ_Daley]

Mike, when you say, 'not the game with what most of us are familiar', are you saying us old farts?

The young folks (I mean the 30-40s set) are buying and trading in these golf-homesite developments.  Many of them are not familiar with a game we might have known just 10-15 years ago.  They think that these golf course-homesite-cartball amusement parks, "are golf as it was meant to be played".  They never played on a course where routing matters.

[Mike_Young]

Many don't know a good course from a bad course.  They play golf because of the status and networking they think it brings....and they don't stay with it....why else do they buy in these places anyway?

[cary lichtenstein]

Mike:

I suggest you be happy with the current situation because the state of the golf business today is driven by real estate housing developments, and will be for some time to come.

Cary

[Mike_Young]

Cary,
What you say is what will destroy golf for most people and drive them from the game.  It is not feasible to maitain most of these real estate driven courses without lot sales and once those lots are gone....golf will either be taken by the membership or sold for more housing....
The future of golf is in building more affordable courses that can sustain themselves.  And people are doing it.  Development golf is way out of hand.  

[Bill_McBride]

Rustic Canyon, Mike's Atlanta low daily fee course, Wild Horse... affordable public golf needs to be a big part of the future of American golf, or Mike's right, our golf future is shaky.

The sad thing is that model is found everywhere in the British Isles.......

[Mike_Young]

Bill,
Think about it. what you say is found here also but it is like a good local restaurant, they don't advertise.  No need.  Most of the time when you see a lot of advertising and hype for a golf course it is related to the real estate around it.  Also when they can't muster the $$$rounds they need to survive they start hyping themselves and buying big ads.  IMO if you see a golf course that has been around for 5 or more years and you never hear of it...they are making money....OH and they will not be on any rating list.....and usually no management company involvement also.

[Mike_Sweeney]

Mike,

Lido, The Links, Queens County Golf Club all went down the tubes for the sake of development. This has been going on for years. The three hundred member Overbrook GC in Philly moved further away from The City and was replaced by a 300 bed hospital. That is probably a better use of that land.

I don't really disagree with what is said, I just don't see it as new or a real problem. I also don't really want the government to get involved in the golf industry except for special situations. Schools, healthcare, roads ..... should be the governments priority IMHO. I live in a pretty bad spot for trying to catch a quick 9 after work, but the other stuff outweighs the golf.

[SB]

Mike,

I think you have it backwards.  On average, golf courses are worth 80% of what they cost.  Without lots, why would anyone build a course, except for a member owned club?

You couldn't be more wrong about who's making money.  The older courses you think are making money don't justify the investment, it's just that they've already been sold for a big loss, and the new owner doesn't have a lot of debt and doesn't have to struggle.

Bill, there are two key points that help British courses.  First, construction costs are lower, and most have been around forever and have no debt.  Second, the cost to run the course is MUCH less, particularly course maintenance.

[A.G._Crockett]

One of the interesting things in all of this will be the fate of the high-end golf course communities when the housing bubble bursts, which will inevitably happen withing the next few years, and almost certainly by 2009, according to demographers like Harry Dent.  I'm very curious to see what happens to golf at the point at which Boomer spending begins to decline sharply.

Actually, I think this is already happening with golf as an industry.  IMO, much of what is decried here as being wrong with the game is actually a pretty simple and predictable demographic reality.

[Mike_Young]

SBusch,
Over half the course I have built in the last 4 years were without lots and they are making it.  Many golf courses are worth more than what they cost you just never hear of them.  I know two right now that cost less than 2.5 millon to build, could be sold for 4 million but will not be because they make the owners over $400,000 per year and they just sit back and laugh at the big boys.  There are guys making money in the business, the last few years could have been off a little but they are stil making a good living out of it.  But then again, why would they be out telling everyone??

[Mike_Young]

AG,
I agree.  the sad thing is when the bubble burst many of these courses could make it as membership courses if it weren't for the excessive maintenace that has been built-in in order to attract and promote real estate sales.  Memberships can't sustain it on their own.  The best courses will continue to cost the least.

[Mike_Sweeney]

SBusch,
Over half the course I have built in the last 4 years were without lots and they are making it.  Many golf courses are worth more than what they cost you just never hear of them.  I know two right now that cost less than 2.5 millon to build, could be sold for 4 million but will not be because they make the owners over $400,000 per year and they just sit back and laugh at the big boys.  There are guys making money in the business, the last few years could have been off a little but they are stil making a good living out of it.  But then again, why would they be out telling everyone??

Mike,

I don't get your point then. The little guys are making it by being smart entrepreneurs, and the big guys will get whacked on a few projects. Golf is a market like every market. When you go into a 7-11 there are probably 200 different drinks to choose from. 6 months later there may be 220, there may be 180, but there probably are 50 new ones to replace the ones that were not popular.

If the developers get out and stick it to the housing owners, they the housing owners can always turn it to open space and go play another course. How is that so bad for your industry?

The housing market is overcooked, but it is not like the internet which is a bunch of code on a computer. It is dirt in the ground which is getting more rare every day. It may lose 20-30% of its value, but it won't disappear. By the way, although the internet got overcooked, we are using it right?!

[A.G._Crockett]

Mike Sweeney
I think the issue will be the debt service that both home owners and golf course owners are taking on with the assumption that prices and spending will continue to rise as they have in the past.  There is a lot of demographic data that says that won't be the case.  In other words, it may not be a matter of homeowners using a former course as a big green area and playing somewhere else; they may not be playing at all as a direct result of the previous decisions.

[SB]

I'd love to see a high quality golf course with no homes built for $2.5M including land, clubhouse, maintenance facility, grow-in, and equipment that makes $400,000 a year.  Especially in Atlanta.  I don't think they exist.

I can, however, give you a long list of courses that owners thought would cost $2.5, ended up costing $5.0M, and are making $200,000 per year, which is a scorching 4% return on investment, considering the risk.  

Speaking of risk, developing a private club is even riskier.  

[Mike_Young]

SBusch,
There are some that do as I described.  But you are correct in that land was not included.  It was given and equipment is/was leased..  On the right piece of land you can do it.

[SB]

All that said, I agree with your basic premise that the golf courses have no soul.  The basic problem in developments is that the land planners do not know how to route a golf course well and the architect gets stuck with a routing that he can only tweak, as opposed to build from scratch.

[Keith Williams]

Scott,

Land Planners definitely do know how to route golf courses; their talents may not be the equal of the best golf course architects, but they do know.  The problem is that they also know that 99% of the time the areas of a site best suited for a golf course are also best suited for building lots; and since the projects are development driven, not golf driven, they are forced to dedicate the best land to homesites.  This leaves the left over bottomlands, floodplains, and steep hillsides for golf.  You are aware of this I am sure, you see this everyday at the Canongate courses.

In basically all of my experiences in land development the land planners knew exactly what they were doing in regards to the lot layouts and golf corridors (and hated it too, it is surprising how many landscape architects/land planners dream of being GCA's) but their hands were tied because it is the developer's signature on their paycheck, not the golf course archie.

Last year I was asked to review the layout for a course slated to be built in the ATL area as part of a huge planned development.  When questioned by the land planners about any suggestions I might have, every change I mentioned was contested on the grounds of lot quantity, lot quality and lot construction cost.  The planners would have loved to do what I suggested, but there was no way the developer would approve the master plan with the changes...and these weren't drastic requests.  Even on a 1000+ lot development every little penny matters to the developer.

Keith.

[JohnV]

A few years ago a friend and I were up near Seattle playing a practice round before a US Mid-Am qualifier at a course that sounds like the one Mike described in the first post.  As we were walking up the fairway my friend said to me, "I'm really pissed at my secretary."  I asked why and he said, "I'm stuck in a hotel 15 miles from here and there are 5 or 6 Marriotts on the side of every hole here."

Since then I've definitely noticed how many of these McMansions are built alongside modern courses.  I wonder why anyone with less than 10 children need a home that big, but I guess the prices that the developers put on the land require you to build a massive house to justify the cost.  Too bad many of the courses seem to be afterthoughts at places like this.

[Mike_Young]

SBusch,
I agree with most of your last statement except for the issues that Keith explains in his post.  
Keith,
I would much rather have the floodplain than the drainage swales that so many development courses are routed in.  If you know Atlanta then you know that there is course after course where the drainage in the hole corridors cost more than the golf construction.  I do think developers are beginning to accept a core course more than in the past.  I think the "New Urbanism" model is helping in that regard.

[Keith Williams]

Mike,

Your post made me smile.  The idea of combining new urban design principles with a core golf course is something I have often thought would be a successful and unique product in the Atlanta marketplace.  A development like that would be highly marketable and would certainly fill a void that currently exists here.  Atlanta almost had something like that with New Manchester on the west side (not too far from Wolf Creek), but the developers managed to seriously screw up what really should have been a can't miss opportunity.

I am sure that you have intentionally left out naming the course that inspired this thread, but is there any chance you could toss out a hint...honestly I am dying to know.

Yeah, the drainage issue is fairly common, in fact at the course I mentioned above the hole corridors were also saddled with the responsibility of accepting all of the runoff from the lots and incorporating all of the associated detention facilities.  Nothing like a golf hole that doglegs around a dry detention pond with a concrete standpipe  

Speaking of...my memory might be off, but I thing that at one time you prepared a routing for the site/course I have been mentioning.  Does the name "Deep Creek" in south Fulton sound familiar to you?  I know Steve Smyers was at one point slated to do a course on the property, but I thought I also remember hearing the planners mention a prior Mike Young routing.

Keith.