Some clubs invest a few million dollars to reinvent themselves, some a lot more. All of them are seeing a good return on investment, and none of them are being managed the same way as in the past.
These are the good old days.
I spoke with a golf pro recently and asked how the season has gone for him and the club. Once we got past the perfunctory lament about early-season wet-weather conditions, I was somewhat surprised to hear him go on about how much the industry has changed and that it “just isn’t the same any more.” Really? Duh.
Golf is never going to be, nor has it ever been, a mainstream sport. The surge in golf course supply in the late ‘90s (more than 400 new courses opened in 1999 alone) was driven more by real estate development than it was by demand—although this period coincided with the growth in play inspired by Tiger Woods mania. The giddy growth days for golf in both supply and demand were short-lived, and the industry has been self-correcting on many levels for the past seven or eight years.
So of course it’s not the same. But the new reality is pretty darn good.
Consider the game at the professional level. The talent on the PGA Tour is outstanding, and it’s young. It was great to see 51-year-old Davis Love III win the Wyndham Championship, but make no mistake that the game belongs to the young guns who are in great shape (thank you, Tiger) and who play long and fearlessly. Today’s youth who have an interest and passion for the game can relate to this new generation of professional golf talent.
As for private and/or public golf clubs, the Darwinian period is now largely behind us, and the survivors are doing quite well, thank you. The club market is a highly fragmented industry, so one club’s fancy is another’s folly, and it is difficult to paint a picture with only a few brush strokes. Yet we can find examples suggesting a path to success, and most of this relates to managing the club as a business, with well-conceived strategies and tactics (and this is certainly not the same as has been the case for many clubs in the past).
Separate from your political opinion of Donald Trump, you have to admire and respect his ascent to prominence as a golf club owner/operator. The Trump portfolio now includes 16 prestigious clubs, and his impact on the business is noteworthy. A number of his golf acquisitions were distressed properties that he bought for pennies on the dollar.
It stands to reason that a new owner won’t follow the path that led to the club’s prior demise. As we highlighted in our January 2015 cover story on Trump National Golf Club in Bedminster, N.J., the fix for a newly acquired Trump club is a significant investment in the facility to make it great once again—a strategy similar to ClubCorp’s “reinvention” program. Trump understands that you can’t save your way to prosperity, nor can you operate the club the way you used to.
We write a lot about clubs (including the September cover story on The Philadelphia Cricket Club) that have undertaken their own versions of “reinvention” programs. Some invest a few million dollars, some a lot more. All of them are seeing a good return on their investment, and none of them are being managed the same way as in the past.
You might have caught the shot of Jordan Spieth giving Jason Day a “thumbs up” after a good, long putt on one of the closing holes of the PGA Championship. It was symbolic of his acknowledgement that Day was putting up a consistent, winning effort.
The golf and club market also deserves a thumbs up, for stepping up and not being the same any more.
QUOTE OF THE MONTH
“If profanity had an influence on the flight of the ball, the game of golf would be played far better than it is.”
—Horace G. Hutchinson
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