The Demise of A Golf Course – It is Interesting Process to Watch…

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Started with a vision in late 1999 during the golf building boom, a golf course was built in a mountain community with full-time residents of 346 swelling to 4,000 during the Memorial to Labor Day season.   The two nearest towns have populations of 290 and 1,634.   Within 100 miles, three cities with populations of 5,409, 9,562 and 17,557 were present.  At 250 miles, cities with populations 108,249, 439,886 and 663,862 were available to attract golfers.

The golf course was fun to play. The front nine played along a river with the back nine encircled by US Forest Land in which bears roamed at night.  Vistas of 75 miles abounded.  A fishing club on a great river where river rafting was added with a spectacular lodge included as an amenity.  Theatre and fabulous gourmet river front dinning options were close. The bet? The sale of lots with pricing ranging from 30,000 to $150,000 for 1 to 2 1/2 acre lots hoping to attract the well-to-do from Kansas, New Mexico, Oklahoma, and Texas to build homes with pricing ranging from $300,000 – $2,000,000 plus.   Lots include membership in a golf club, priced at $15,000.

There was strong initial interest.  Sales went well.  Immediately plans for a resort complex with a hotel were floated by a Dallas investment group.  A major professional sports owner, unaffiliated with the project, talked about how his investment in a nearby ski resort where Forest Service Permission was required to build was likely to be forthcoming.  This was to be the next major year-round recreational retreat.

Today, the golf course is for sale for $5.2 million.  The replacement cost of the assets is probably near $15 million.

What went wrong? When the developer (4 of the 5 individuals are now bankrupt despite selling the golf course for fair market value) sold the golf course to a former NFL Football player, the mood changed and has never recovered.    As an owner, the NFL football player, was mean, demanding and alienated quickly nearly the entire membership.  He failed to embrace the entire town feeling what he controlled was special in which limited access should be accorded.

Three years later, the course was sold to a successful real estate developer who has a great love for fishing and little understanding for golf.   The fishing club was closed making it his private weekend residence. The club, designated to be a year-round resort, operates from May to October.  During the height of the summer, the golf course closes at six p.m.  Limited food service is available from to 11 – 2.   Weddings, private parties or other special events can no longer be scheduled.  The athletic facility is closed.  The swimming pool, in which membership is required, has few visitors.  The course lacks a superintendent and a pro shop staff.  The talented GM has now become “jack of all trades.”  The club is down less than 30 members.

What is the lesson?  Individuals have choices.  In operating a golf course in a remote location, honoring and pampering the guests making them feel special is fundamental.  Each owner failed to grasp that by owning a golf course you are in the entertainment business, and if the customer is having fun, they are gone.

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