20% of Scots golf club in 'financial difficulty'!

[David_Tepper]

Article in the Sunday Herald:

http://www.sundayherald.com/news/heraldnews/display.var.2403680.0.20_of_scots_golf_clubs_in_financial_difficulty.php

[Ally Mcintosh]

David,

To paraphrase one part of the article, it said that top-end projects such as Nicklaus's signature course at the Ury Estate and Paul Lawrie's first course (who is actually designing this? EGD?) at Blair's College are safe and doing well...

In Ireland, it is the over supply of top-end share-based clubs that seem to be struggling in the golf market... At least that is the perception passed on to the general public... Too many developed at high cost through the Celtic Tiger years...

As an aside, what are the sites like at Ury and Blairs?... Are they conducive to building top-class inland golf courses?

Thanks,
Ally

[David_Tepper]

Ally -

As far as I know, both the Nicklaus course at Ury Estate and the Lawrie course at Blair's College are still in the planning/permitting stages.  I am not sure if construction has actually started yet on either golf course.

GCA-er Brian Ewen lives in the Aberdeen area and would best be able to answer your question about the sites for these courses.

The next upmarket golf course to open in Scotland is likely the Mark Parsinen project at Castle Stuart, near Inverness.  The course is now in the grown-in stage and will open for daily fee play next June/July (www.castlestuartgolf.com).  My sense is the build-out of the resort facilities (hotel, lodges, spa, etc.) will take place over a number of year to manage the financial risk.

DT     
 

[BCrosby]

David -

Any word on Archerfield?

Bob

[David_Tepper]

Bob -

I am hardly an expert on golf in Scotland (and would not want to be perceived as such!).

As far as I know, the 2 courses at the Archerfield club have been up and running for a couple of years now and Doak's Renaissance Club @Archerfield has opened within the past year or so. There is a thread on Doak's course (with pictures) that surfaced on this board recently.   

Those are the only Archerfield courses of which I am aware.  I have not seen any of them and I have no idea of how they are doing financially.

DT

[Dan Herrmann]

Wouldn't it be safe to say that 20% of US clubs are also in 'financial difficulty' too?  I know that a club to which I used to belong is giving the house away just to get bodies playing - no initiation, no bonds, no minimums - just the monthly dues.  They've gone from 250 members to about 100 in only 8 years.

[David_Tepper]

Dan -

I would tend to agree with you. It would be interesting to know what percentage of golf clubs in the U.S. have 1/4 or 1/3 of their membership over the age of 70. Time will rob many golf clubs of a large percentage of their membership over the next 5-10 years. Replacing those members will not be easy.

DT   

[Adrian_Stiff]

Its probably the same south of the border too, in the UK houseprices are down by 30-40% from last years high on forced sales.
Sky Tv, Pubs and Leisure look casualties, with many golf club's annual subs at $1750 per year now, many simply wont be able to afford to rejoin. Big corporate days will be rare as companies that are doing okay will not want to waste money on non essentials. The 20% could be bigger in a years time. Simply there is not much spare money around and people in business are just adopting a 'wait and see' attitude.

[David Lott]

Remember, most Scots golf clubs are amazingly cheap to join by American standards. Many of the courses have been around for a long time, and thus have long ago amortized the cost of construction, which was puny by modern standards. Most of these clubs welcome non-members at most times, and for many greens fees of vacationing Scots, Americans and Brits goes a long way towards paying the bill. The clubhouses are not lavish. They don't maintain tennis and pools. Plus the bar business--the big moneymaker at clubs worldwide--is pretty good in Scotland, last I looked.

I doubt these types of clubs are in much trouble, unless they went out and ran up debt. Assuming that this 20% figure has any basis in fact, I'd love to see a breakdown of the difference in financial soundness of the older, simply and stringently managed clubs and that of newer and splashier facilities.

I have always been an admirer of the middle range of the Scottish clubs. I hope this basic and enjoyable golf experience is not in danger.

[Brent Hutto]

David,

When we visited Golspie last month, one of the middle-range clubs you mention, I don't recall the exact number but as a small-town club they have only a hundred or so members. Now admittedly they don't have construction debt to pay down like your typical USA club but even for basic operating expenses that's not a lot of people to spread the cost through. They do get some visitor play which is a source of income but it's not thousands and thousands of round per year as at the clubs more famous over here.

On the other hand Pitlochry had recently done a beautiful clubhouse expansion and may have been financially a little more comparable to USA clubs. But then again they are owned by the local estate and the membership is not footing the bill for capital improvements. I love a funky old clubhouse as well as the next GCA type but I must admit Pitlochry's brand spanking new dining room with windows overlooking the course was extremely comfortable and welcoming. And the food was good (they didn't have any beer I cared much for though, England seems better in that regard for my taste).

[Adrian_Stiff]

Remember, most Scots golf clubs are amazingly cheap to join by American standards. Many of the courses have been around for a long time, and thus have long ago amortized the cost of construction, which was puny by modern standards. Most of these clubs welcome non-members at most times, and for many greens fees of vacationing Scots, Americans and Brits goes a long way towards paying the bill. The clubhouses are not lavish. They don't maintain tennis and pools. Plus the bar business--the big moneymaker at clubs worldwide--is pretty good in Scotland, last I looked.

I doubt these types of clubs are in much trouble, unless they went out and ran up debt. Assuming that this 20% figure has any basis in fact, I'd love to see a breakdown of the difference in financial soundness of the older, simply and stringently managed clubs and that of newer and splashier facilities.

I have always been an admirer of the middle range of the Scottish clubs. I hope this basic and enjoyable golf experience is not in danger.

David - The cost to run golf in the UK has soared in the last few years. Seed, Fertiliser, Fuel, H & S compliance, Utilities, Haulage.... there are probably less rounds to go round, its expensive for you Americans to come over now.

[Brian Phillips]

The Ury estate project has not started yet.  Construction might begin this year but still not sure.

[Chris Kane]

Remember, most Scots golf clubs are amazingly cheap to join by American standards. Many of the courses have been around for a long time, and thus have long ago amortized the cost of construction, which was puny by modern standards. Most of these clubs welcome non-members at most times, and for many greens fees of vacationing Scots, Americans and Brits goes a long way towards paying the bill. The clubhouses are not lavish. They don't maintain tennis and pools. Plus the bar business--the big moneymaker at clubs worldwide--is pretty good in Scotland, last I looked.

Most Scottish golf clubs would get very little in the way of vacationing Scots, Americans and Brits.  They have basic facilities, and struggle to pay for them because they charge low subscriptions.

[Ally Mcintosh]

Thanks David, Brian,

Being an Aberdonian myself, I was interested in whether the opinion was that the topo and soil is good on these two sites (Ury and Blairs)... I understood that Construction had not started...

Were you originally involved with Ury, Brian?... Before the Nicklaus machine rolled in?

[Paul Nash]

I think the theme of hardship at golf clubs has been evolving for about the past decade. This is best evidenced in looking at the waiting lists (or lack of them) and the fact that some clubs that used to be closed to visitors are now allowing some casual golf - you can now play Rye as a visitor, my club, Bearwood Lakes, opened its doors last year to help generate some extra revenue, and last time I was at Swinley, the pro told me that I could probably get a game if I rang up - it was previously only pre-booked societies.

There has been a big change in the economic landscape of golf course management over the past decade, and it can't only be blamed on the credit crunch. Clubs are struggling for membership, even exclusive ones that only 3 or 4 years ago had big waiting lists are now open for membership. Compared to 10 years ago, the situation is a complete night-and-day change. In the Reading area, clubs such as Calcot, Reading, Sonning, Henley, Goring etc all had big waiting lists but you can now get straight in. Even 3 or 4 years ago, I suspect that Worplesdon, West Hill and North Hants all still had reasonably long waiting lists - yet you can now get straight in. Similarly, you can get straight in at Hankley if single figures and wait only about 1 year if higher (Incidentally, I think Hankley is absolutely stunning - I have only played it in the past couple of years but they have had a massive tree clearance and it just highlights the most magnificent piece of heathland that I have ever seen)

The only clubs in the area that you can't get in are Sunningdale, The Berkshire, St George's Hill and Swinley, which are still next-to-impossible to even get on a waiting list. The only other clubs in the southeat that I suspect are/ may be still hard to get into are Walton Heath, Ashridge, Royal St George's, Royal Cinque Ports and Rye??

The good courses in the Bournemouth area are all now open and I can't think that there are many others in the southwest that have waiting lists of any note. In Wales, I suspect it may only be Royal Porthcawl. I would guess that some of the big names in Lancashire may still be hard and maybe Ganton, Alwoodly, Moortown, Little Aston, Royal West Norfolk, Hunstanton maybe?

I think several golf clubs will go to the wall over the next few years - mainly the poorly built/ designed courses that were built to satisfy the big demand in the 80s and 90s due to the fact that you couldn't get membership at most of the older clubs.

[Mike Sweeney]

I don't think this is much different that the US market. Second tier clubs must be sweating right now, and 2009 could be a tough year for the golf market.

Not a great time to own boating stocks right now either as leisure gets squeezed.

[Mark_Rowlinson]

England has been in this situation before - look at the number of high-profile new ventures which crashed in the 80s/90s. In Scotland Loch Lomond got off to a shaky start, too.

What has changed in England, however, is the number of pay-and-play courses which were built in response to the R&A's announcement that we needed a further 700 courses to cope with the potential growth of golf, money from the EC for farmers to take land out of agriculture, and so on. This has meant that previous members of golf clubs, who play only occasionally, have resigned because they don't want to pay £1,000 a year fees for perhaps six rounds a year. Why not pay £15 a round at the local pay-and-play?

Family life has changed, with both parents working full time and few of them in the 25-40 year-old age group being able to take enough time out on a weekend to fit in a round of golf, and certainly not to play a round on saturday morning AND turn up again at 5.30 for the presentation. 'Car park' golfers who never go in the clubhouse and don't support social functions are, it seems, on the increase.

Another reason for younger people not joining members' golf clubs is the adherence to dress codes. They don't wear a suit or collar and tie at work, so why should they have to wear blazer and tie in the clubhouse?

Many golf clubs are now seeking non-golfing activities to assist their finances, such as weddings, conferences, public meetings etc. I noticed that a local club had a big poster outside saying 'Now licensed for civil ceremonies.'

The real threats to members' golf in the UK are legislation on race and ethnicity, gender, and health and safety. How many golf clubs are going to have to close holes or rebuild them because of golf balls finding their way into houses or gardens, or potentially causing a fatality by smashing a car windscreen? Lindrick had to close a hole and replace it, several local courses do not allow wooden-club tee shots on certain holes on which it is possible to hit a ball onto a motorway or into housing. When will the 1st and 18th on TOC have to close because of the public road which crosses them?

[Paul Nash]

Mark
I played North Hants the other day and they are having to redesign the 15th, a par 3, because of balls going into a woman's garden  - this is a new house built less than 5 years ago too close to the boundary of the course and they are making a 100+ year-old course redesign a hole!

[Mike Sweeney]

England has been in this situation before - look at the number of high-profile new ventures which
Family life has changed, with both parents working full time and few of them in the 25-40 year-old age group being able to take enough time out on a weekend to fit in a round of golf, and certainly not to play a round on saturday morning AND turn up again at 5.30 for the presentation. 'Car park' golfers who never go in the clubhouse and don't support social functions are, it seems, on the increase.

Another reason for younger people not joining members' golf clubs is the adherence to dress codes. They don't wear a suit or collar and tie at work, so why should they have to wear blazer and tie in the clubhouse?

Mark,

Did you move in next door to me in NYC?

Please add in I find it easier to negotiate with my wife for "golf binges" (4 rounds in 48 hours) rather than a one round on a weekend.

As you walk out the door, the question comes "What time will you be back?" sits over you for every short putt on the last 4-5 holes!

[Gary Slatter]

I would think that this is a world-wide thing, that 20% or more of all golf clubs are "in trouble". 

The projects that have been approved but are not open yet are doing fine, world-wide.

We have found a significant shortage of US golfers, more Canadians, more Europeans, more Asians, and more Scots are making up the numbers. 

T-times are available most days on the Old Course ballot which seems unusual. 

We were doing 78% of last year's rounds and we have only one course open compared to two in 2007, however July has become quite quiet.  Excuse me I have to go put my name in tomorrow's ballot.

[Brian_Ewen]

Paul Lawrie's first course (who is actually designing this? EGD?) at Blair's College

Ally
I am led to believe the designer is Robin Hiseman from Laurencekirk , for EGD .

[Darren_Kilfara]

As I understand it, one of the Scottish clubs that is in trouble is The Glen, on the east side of North Berwick - the main cause being the club's decision to tear down its (perfectly acceptable) clubhouse and build something more modern, I think in large part to chase after a larger slice of tourist revenue. Bad mistake...even in a good financial climate, this would have been a bad decision, but nowadays it's even worse.

I'm a bit nervous insofar as my home club (Dunbar) is currently planning to tear down its clubhouse and build a new one as well. However, as a) the new clubhouse will be built in the vicinity of the current 2nd tee, as part of a plan to build a proper driving range, practice green, short-game facility and nine-hole short course (i.e., it's not just building a new clubhouse for its own sake), and b) the planning process has been moving forward very slowly and sensibly, I'm not too worried. Clubs that get caught up in the clubhouse arms race and spend beyond their means to keep up with the Joneses deserve what they get, to be honest...

Cheers,
Darren

[Mark Chaplin]

David Lott - I've yet to belong to a club that makes money in the bar and catering, far from being a money spinner on this side of the pond house and bar is usually a struggle to break even.

Mark Rowlison - You are quite right about the threat of the health and safety brigade. I do disagree about the dress code obsession though. There are clubs where members do not mind dining next to someone who has just walked for 4 1/2 hours in humid conditions and is dining next to you in the same attire and there are clubs where that isn't considered acceptable. I'm happy to nail my colours to the latter.

Paul Nash - I can assure you cannot get straight into Worplesdon, the wait may not be too long providing you have a proposer and seconder plus the required number of signatures. The proposer has to do considerable work on your behalf so isn't easy to come by. Add Alwoodley to the Sunningdale & Swinley category.

[Dan Herrmann]

I wonder if US and Canadian private clubs will ever allow limited play to outsiders? 

Almost all already do this to a limited extent via outings.    I'm not talking about the top echelon here - they should remain closed, but there are many middle-tier privates that would be huge fun to play.  And I'd be happy to pay.

Of course, the fear is whether they'll behave themselves.  Two years ago, we had a number of guests from another local club that was closed for several weeks.  These guys were much worse than the local public players in that they took carts through the high fescues, didn't rake bunkers, and played very slowly (over 4.5 hours).

They were comp'd (which was fine), so we weren't making any $$$...   How do European clubs handle the possible problem of having players that don't know how to play quickly and leave no trace behind?   

[David_Tepper]

Dan H. -

The subject of some public access to private clubs in the U.S. has been debated/discussed on this board several times over the past couple of years. I am not sure anyone's mind would be changed by going over it one more time.

Clearly, the golf clubs in GB&I are happy to receive the extra revenue from visitor green fees to offset club expenses and help keep club dues for members low. 

Unfortunately for many clubs in GB&I, the vast majority of visitor green fees (at least spent by visiting Americans) probably go to a relatively small number of highly-ranked golf clubs.   
 
DT