[Forrest Richardson]

From time to time I get some course listings. This one caught my eye — no clue if any are decent courses, but the price seems right!


18-holes in Frankfort, IN - clubhouse - equipment - maintenance facility  -- Listed at $1M

9-holes in Essex, IL - clubhouse - maintenance facility (no owned equipment) - Listed at $850K

9-holes in Cherry Valley, IL - clubhouse with apartment - equipment - maintenance facility - Listed at $750K

9-holes in Onamia, MN - no clubhouse - equipment - maintenance facility - additional acreage available - Listed at $690K

9-holes in Hoffman, MN - clubhouse - equipment - maintenance facility - additional acreage available - Listed at $300K

18-holes near Grand Rapids, MI - clubhouse - equipment - maintenance facility - additional acreage available - Listed at $1M

For more information -- please contact www.commercialadvantagegolf.com !

[RJ_Daley]

Interesting... on the link there are a couple more that are well over 1 million.  But, one of them, is a course I'm fairly familiar with.  It has some interesting possibilities, and I suspect some big hurdles to overcome in the way of infrastructure and current market conditions.  If someone is interested to ask me what I might understand about it, IM me.  The two concept redesign plans found on the link, to sell off 9 holes of land for development are feasible, but the remaining course schemes are not good, IMHO.  I do think there are better routing schemes that would require more redesign work than depicted.  But, the area travel corridor is/was booming.  The 8 associated photos on the link are good representations.


"27 holes, 200 acres +/-, 2007 Revenues: $1.3M, Positive Cash Flow AFTER Debt Service
Clubhouse, Banquet Rooms, Bar, Pro Shop, Driving Range
Plans for 18-holes creating 17 acres +/- of commercial frontage on Hwy 41 (70K cars per day)
Offered at $3.7M"

[Adam Clayman]

These are great opportunities for working supers to take a chance. Anyone else, who thinks they can hire out someone, who will turn things around, is fooling themselves. The work needed will likely only happen from someone with a deeply vested interest and the smarts to fix everything.
I'd also suggest getting a better price.
 

[Peter Wagner]

One of the courses listed for sale is this one:

Northern Bay Resort
http://www.northernbayresort.com/

Course info:
http://www.golfdigest.com/courses/places/13398

From the pictures it looks like they maintain that puppy pretty well.  Marina, possible hotel, condos for sale, there is a lot going on here.  Almost dead center in the middle of Wisconsin which might be good as a weekender for many.(?)

I'm not a fan of replica holes but I think the course has potential.

Wonder what they do to make money in the winter?

[Adam Clayman]

Peter,
Shocking they are for sale. A seaside links style with mandatory cart policy. Shocking!

[Peter Wagner]

Adam,
Yeah I saw that too.  Mandatory carts is a real mistake for a course like this.  On the other hand, they have made some good moves by having alternative revenue sources with the marina and condo rentals.  Also says they are close to snow mobile and ATV trails so you might see fall and winter rental biz.

Wonder what the asking price is?

[Jim Colton]

my in-laws have a place on the same lake as Northern Bay. I've played the course once. I'm not a big fan on replicas holes and in my opinion they arent done very well. The replica of the 16th at Augusta is awful. The replica course might have enough cache to get people to come out once, but at 85-95 bucks per round it better be pretty special to get people to come back. With Trappers Turn and Wild Rock much closer and as good or better, what's the motivation to keep driving 35 minutes to play Northern Bay?

[Lou_Duran]

Peter,

If there are any excess funds at the club, may I suggest a JV with one of John Kavanaugh's "Betterment" foundations to acquire a couple of these bargains and operate them for the wider interests of public golf?  Think of it as an "investment" in the game; a Habitat for Humanity but with highly affordable golf as its focus.  I am no Bobby Kennedy, but I do get teary-eyed just thinking about the possibilities!

Forrest,

There are "asset buys" everywhere, but best places to look are states with declining jobs and populations that have had considerable building activity over the past 10 to 20 years.  I hear that there are a number of incredible bargains in Michigan.

With the price of fuel, labor, and many inputs going up and up with no end in sight, relatively flat growth in rounds (demand), and a historic increase in income and investment taxes looming in the near horizon, who in their right mind would be looking to risk their money and time in the industry?  While playing a local muni yesterday that was built many years ago as a private club, another GCAer and I concluded that the next several years might be an opportune time for cities and communities to increase their portfolios.  Unfortunately, where the deals are, the communities are typically in no better shape.            

[Forrest Richardson]

Lou — Smart people and companies can make money in golf. I am not at all suggesting anyone invest in these courses, but I found it interesting they were all below $1 million.

Historically, it is lean times in the economy when daily fee golf has flourished. But, you have to have the correct locale and the correct price point.

[Peter Wagner]

Hi Lou,

You are correct when you say there are other businesses that make more sense than trying to find something in the golf industry.  I have an unfortunate habit of business planning everything I see.  It drives my wife nuts when we go to a restaurant and I'm only half listening to her as I scan for operational improvements.  Mental disorder or mental midget, I can't decide sometimes.

- Peter

[PCCraig]

In terms of commercial lending, a golf course is very risky. Generally speaking it is difficult for them to find working capital. The way they do find financing is when lenders look at them more in the commercial real estate light vs. in a commercial and industrial / cash flow.

[JWinick]

I work for a leading small business real estate lender.   We finance golf courses from time-to-time.  Usually, we'll do these deals through the SBA 504 program, which allows up to 90% financing for multi-use properties, 85% for special-use properties like golf courses.   Without the SBA, we would limit our exposure to approximately 50-60% of the lower of cost or appraised value. 

Golf courses are business loans secured by real estate.  As a pure real estate play, you're left with little else but raw land in the event the business fails.   If you don't have historical DSC (debt service coverage), it's going to be very difficult to get any golf course approved in this credit environment.   

[JC Jones]

I dont see the Grand Rapids listing?

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