Why Are All These Courses Closing?
By Kickntrue on 8/24/10
Over 100 golf clubs per year are closing in the US. Oh my... this is so bad. Why is this happening?
The Hampshire's 18-hole course on Long Island Sound, along with its tennis courts, pool and restaurant, is closed this year. Members cited rising costs upwards of $25,000 a year for a membership as the roster fell from several hundred at its peak to about 100.


The same thing has happened in recent years at hundreds of other courses nationwide - even in the golf meccas of Florida, Arizona and California - as the economic meltdown and changes in family dynamics combine to threaten club life. Whether it's a $45,000 initiation fee for a private club or a $5 increase in the cost of a round at a public course, the price of a golf habit is giving some duffers pause.


Many members who "have had their individual problems with the recession" quit the clubs for financial reasons, Mottola said. Initiation fees for MGA clubs averaged just under $50,000 last year; annual dues were about $10,500. Mottola said while the fees were "trending downward" they remained the highest in the country.
Ohhh... that's why! Who would've ever thought a business model based on asking people for 30% of the average per capita income in the USA for the chance to play golf and go swimming would backfire?! This is so sad. What about all of these people who will have to go play public golf now?! I feel so bad. I mean... now their only options in Long Island, NY, are public courses like Bethpage! Their lives are over!

Sorry to make you choke on my sarcasm... but really, come on! How am I supposed to feel bad for my own industry when it's built on such ridiculousness?!

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[ comments ]
birdieXris says:
I'm having deja vu all over again.
mjaber says:
Any "private" club that allows there members to just walk away (I believe it's called a non-equity club) is going to go down. It happened here with the place I had my wedding reception. It closed 1 year, almost to the day, after my wedding. It re-opened this year as a semi-private course. That is probably what will happen with some of these courses that are closing. They will be bought at auction, someone will sink some cash into it to rehab any problems that were created by it being closed and not maintained, and it will re-open.
Kurt the Knife says:
waah waah waah
Banker85 says:
This shouldnt be a surprise to anyone. Bad economy, people not spending money on fancy club memberships, Clubs losing money, property values still down, golf courses not worth as much, some cant get financing to keep up with overhead. real estate is in the crapper still, so until it starts to climb upward again these courses are going to be hurting.
wrhall02 says:
Too many courses have priced themselves out of the reach of the middle class golfer.

As much as I play and like to play (6-8 rounds per month), I HAVE to avoid the $100+ per round courses. Given my current budget, the decision is easy; I opt to play 4 rounds on a decent course rather than 1 round on an "exclusive" course.
c5agalb says:
Who wants to bet that Pebble Beach will always be $495 and going up? Cant play golf, kids need stuff for school.
tennesseeboy says:
This is the life cycle of a golf course.
1 - Someone borrows big bucks and builds golf course.
2 - Owner must charge very high green fees to make payments on the big loan.
3 - No one plays the golf course because it's too expensive.
4 - Golf course goes broke.
5 - Bank takes golf course.
6 - Someone buys golf course from bank for a fraction of what it took to build it.
7 - New owner lowers green fees.
8 - Golf course becomes popular.
9 - Golf course is profitable.
psvaren says:
Unfortunately this is hitting very-reasonably-priced municipal courses too. Up here in Minnesota, city-owned courses were a cash cow in the late 90's and actually provided significant surplus revenue for the cities. Probably was the same across the nation. Now they are barely breaking even or going in the red and will be on the chopping block when the next budget cycle comes around. Will be sad to see some of these go as they can be great inexpensive places to take the kids to just hack around.
mdbuschsr says:
Sorry, this got unexpectedly long.
All of this kind of plays into the public’s elitist view of golf don't you think?
There is a small market for the mega-wealthy, and there always will be. There are those that would never think of playing a semi-private course, let alone playing with the dregs of the earth on a public tract. They have the money, or the credit, to maintain a high end membership and when I say good for them, I mean it! If I had the budget to allow me to play the most upscale courses, I would play them.
IMHO the entire industry is missing the boat in a huge way. There is a world of people that are in the lower to middle, middle class. We don’t have the funds for an ultra-exclusive membership to a club.
How many members would it take at say $1000 per year (family membership) to sustain a relatively nice golf course, tennis courts, and swimming pool? I don’t need (or want) a club house appointed with crystal chandeliers, and a stuffy wait staff serving $60 plates of food.
mdbuschsr says:
Rather, think Cracker Barrel type genre, at the same price point, served only Friday to Sunday. Think, an 18 hole golf course that may not be perfectly manicured with a top 500 pro. 4-8 Tennis courts with a teaching pro (don’t know anything about tennis so I can’t speak to that one). And a swimming pool for the rug-rats (er’ kids) and family that don’t golf or play tennis. If such a thing existed in my area, I’d be all over it. It would be a really tight fit in my almost non-existent budget, but I would find a way to make it work.
mdbuschsr says:
Another point is… If the industry manufacturers would leave older equipment on the market a little longer for reduced rates as new stuff comes out, I think they too could make more money. Again, there is a market for those that have to have the newest driver every FREAKIN’ year. I am not that guy! I expect that a lot of my lower middle class contemporaries feel the same way. I’d be happy to purchase a 3-4 year old model club for a discounted price. Sorry I just won’t spend $300+ per year on a single club! I know they spend a BUTT-LOAD of money on R&D, and even more on endorsements, so spare me that rhetoric! I couldn’t care less if Tiger Woods can hit this driver 350 yards, or if Phil can stick that wedge to 2-inches. I don’t have that kind of game and for the record, with few exceptions… NEITHER DO YOU!
Now, I just need to win the lottery and buy one of these failed courses. Then I could afford an ultra-exclusive membership! LOL
jefs2box says:
I wouldn't mind paying for a membership if it was for a group of courses. I just can't imagine wanting to go to the same course all the time. Part of the fun of the game for me is playing new courses, or returning to old ones that I hardly remember. I think I would need a membership that had about a dozen courses included to be happy with it. Does such a thing exist?
windowsurfer says:
Lots of clubs have reciprocal arrangements with other local courses. That helps the variery issue.
cjgiant says:
I agree there seems to be a middle ground missing. Perhaps the economics of it does not allow for such. To cover costs, a decently maintained course obviously needs the best mix of volume and price. Obviously private courses lean towards lower volume-higher price balance. This means each unit of volume lost has higher impact; that may in turn cause a built in "extra" premium to cover the potential of such losses.

Maybe for this reason it's hard to find the mix of "value for money". I'd consider pre-paying (at a reasonable premium) for a good course if I could play a 4 hour or less round basically whenever I want. Unfortunately most private courses do not fall into what I consider "reasonable".
elhacker says:
One of our local municipal courses has lost 20,000 rounds/yr from three years ago. This course averaged 65,000 rounds/yr in 2007. That is a huge revenue loss for the taxpayers of this municipality. The super had to lay off staff further hurting the courses already poor reputation. It's not just the exclusive private clubs that are hurting and going under. The small mom and pops and munis as @psvaren have stated are getting killed.
Bryan K says:
Most of the private courses around these parts are offering extremely discounted memberships as well as allowing the public to play in order to stay afloat. Of course, this was exacerbated by the fact that they all experienced major flooding in 2009. However, the golf industry still seems to be doing well in this area. We have a new municipal course being built in one of the higher property value areas of town. Meanwhile, I pay $700 a year for the five-for-one membership in town, which includes a pitch 'n' putt, two regulation length courses, and two executive style courses (par 32 and par 33). There is good variety in there. Of the two regulation length courses, one is heavily wooded while the other is wide open. Meanwhile, the par 33 executive is a links-style course with wide open fairways. It's a pretty good value.
rmumph1 says:
$700 a year is a great deal, everything around here is $150 or more a month. And they aren't even that great of courses. I would definitely take that deal of $700 a year.
shaffer1969 says:
Courses could be more creative in attracting members. I've seen courses go with different types of memberships. For instance, unlimited play during the week but no weekend rounds included in the membership.

One of the objections I hear most often concerning paying membership fees is whether or not one can at least "break even". Can you play enough rounds to justify a membership versus paying greens fees? Playing once a week may not get it done.
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