Developers see golf club troubles, and start buying

Jul.July 01, 2010 07:00 AM

Even beyond the sordid chronicling of Tiger Woods’s personal
peccadilloes, it’s been a tough year for the sport of golf. Membership
at country clubs nationwide has plummeted, leaving many on precarious
financial footing.

According to Hunki Yun, the editor of LINKS Magazine, financially
troubled country clubs looking to leverage their real estate assets
have fewer options than before. “What you could always do in the past
is convert the courses into housing, but no one is building anymore, so
that is not an attractive option,” he said.

— A year ago, the Trump Organization finalized its $18 million
acquisition of the Lowes Island Club from Chevy Chase Bank, extending
Trump’s luxury golf empire to the Washington, D.C., region for the
first time. “As of late, [golf clubs] have made sense for us,” said
Eric Trump, executive vice president of development and acquisitions.
But Donald Trump lost a bidding war in May for the Emerald Dunes Golf
Club in South Florida. Trump, who bid $15 million, planned to make
Emerald a public course.

— In December, Trump acquired two more golf courses closer to
home: the Branton Woods Golf Club in the Hudson Valley and the Pine
Hill Course in New Jersey, which it purchased from Empire Golf. (Both
courses were immediately renamed Trump National and are now operating
as high-end private clubs.) “I like golf, I like clubs, and I like the
land that comes with the club,” Donald Trump (pictured above) said in a
recent interview with The Real Deal. “These are great courses.
I’m only buying the best. When they have capital behind them they will
be really fantastic, and I’m buying them at good prices. And with that
comes hundreds of acres of land, which I like having. These are
phenomenal assets.”

— Part of the collateral damage inflicted by Bernie Madoff’s Ponzi
scheme was the North Shore Country Club on Long Island. Close to a
dozen families who lost their investments with Madoff were forced to
relinquish their memberships. In November, when the troubled
member-owned club was ready to pack its irons and shutter its doors, in
came a white knight in the form of developer Donald Zucker (pictured
above), who bought the club for $12.5 million. While a lifelong golf
enthusiast, Zucker is known for his luxury rental apartment buildings
in Manhattan. His proposals include setting up a luxury spa and
renovating the golf course. “I wanted to own a golf course for many
years, and only this economy could have allowed me to acquire such a
great golf course,” Zucker said.

— News reports that it had been bought by a Greek shipping magnate
were erroneous, but the Ridgeway Country Club in Westchester County is
indeed on the block. “As of right now we are for sale,” said Patrick
French, the club’s assistant general manager. Ridgeway has reportedly
placed stipulations on anyone attempting to buy that it must maintain
golf operations for several years. The club’s reported listing price is
$20 million.

— The most recent deal in the New York area involved the Hampshire
Country Club in Mamaroneck in Westchester (pictured below), which is
being sold to New World Realty Advisors, a Manhattan-based real estate
firm, for a reported $12.1 million. New World Realty’s proposal —
which beat out another bid — was accepted and the deal was set to
close last month. According to a source who declined to be named
because of his involvement in the negotiations, NWR plans to operate
the 116-acre site as a country club but has reserved the right to
explore other development options in the future. Like other clubs,
Hampshire’s membership sank over the past year, and the club was forced
to cease operations in December due to financial difficulties.

— Up until a few months ago, the Brynwood Golf & Country Club
in Armonk, NY, just 30 miles north of Manhattan, was known as the
Canyon Club. In January, the private investment group Canyon Club
Partners bought the course and brought in Troon — an Arizona-based
golf course management firm — to run it. Troon is overseeing a
full-scale makeover, including a renovation of the 65,000-square-foot
clubhouse, upgrades to the tennis court and pool facilities, and a new
fleet of golf carts.


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