In our previous two articles (1) (2) we set down the history of golf course development in the British Isles as being in two distinct phases: with a big difference between early 20th century locations of golf and the second wave, a hundred years later, of typically weaker courses in terms of integration with communities, suitability of land and quality of design. In short, many courses and clubs are poorly positioned, both commercially and physically, to meet a market need that is changing and weakening. Because time and social pressures make the single product (18 hole course) less appealing year by year – unless that 18 hole product is truly excellent in quality and location.
We identified various business segments which could be appropriate for residential development on at least part of the property and especially for socially relevant, age- and lifestyle-related residences and activities. All this whilst potentially still providing market-driven golf products and then using the released areas, so creating capital for investment to change the product offer to match the modern market and avoiding the need for additional land purchase.
Where are the opportunities for developers?
Possible solutions need careful analysis of supply and local demand, coupled with drive-time analysis and assessment of highways/traffic. Different types of golfing and other sports leisure activities have very differing acceptable journey times associated with them. Additionally, local stakeholder groups generally exist to preserve status quo not to support change. New solutions must be presented with attractive and compelling cases for backing change – it is not beyond hope that local stakeholders could support inspired, mixed development, rather than resist new thinking, if the product on offer adds substantially to the community.
Clearly, careful consideration of local planning implications is a ‘must have’. Whatever the continuing debate on the efficacy of building on the Green Belt – and it’s a perpetual hot topic – this need not be like a form of Animal Farm: ‘green belt good, golf course bad’. Indeed, many golf courses already occupy the green belt and provide valuable biodiverse enrichment: there is plenty of scope for golf both to preserve and add to the national stock of protected nature reserves and/or public open space. Opening up hitherto privately-held golf course land to wider access is compatible with good business by clubs and homebuilding on a variety of scales. Indeed, homebuilding is at the core of the business opportunity for the existing golf clubs. So, intelligently provided public amenity access is to be welcomed as a benefit to all parties.
Is it just homebuilding?
In our earlier articles we argued that ‘real estate’ included homebuilding and other built forms too: we particularly signalled the advances in social care products for the wealthier demographics seeking accommodation in later years with multi-leisure options – age-banded – which can include golf options built into the lifestyle offer. Below, for simplicity, we have defined real estate as homebuilding.
What and where are the gaps and opportunities for adding real estate to golf clubs?
Accessibility is always key and, as noted, different leisure activities bring differing definitions of accessibility. Suitable target golf properties are less likely to be well established and successful golf clubs: these are succeeding in a tough market because they are mostly well located for their customers and offer an attractive product well.
The 1990s saw plenty of examples of farmers swapping ploughshares for pitching wedges – usually at the ‘pay and play’ bargain basement end of the market. Unsophisticated in design and often on poorly suited land they form part of the inexpensive pay and play course segment, still usually 18 holes, often with driving ranges attached which provide a good value golfing experience for non-members who play less than 15 times per annum. Unless well located – and relatively few were – for this reason alone they are unlikely now to offer opportunity for real estate.
Priced above the pay and play courses are the mid-market offerings. These are the 18 holes only ‘one trick ponies’, but their customers need to drive too far to get there. But how far is too far? Thirty minutes’ drive time is the general maximum for casual non-member golfers unless you are going to enjoy an exceptional product. Many of this group sit well outside conurbations with poor everyday access. Again, a case for new real estate is likely to be undermined by poor location.
The best of the traditional, established, mature clubs continue to thrive on well-earned reputations allowing subscriptions to match the quality of facilities on offer. These are not just the big names: there will usually be a good quality club on the edge of every town, to which those who value the traditional golfing experience, and the social side that attaches to it, will happily belong. These members will play on average c.35 times each year. They tend not to attract families as a group but see women and children as separate markets. Of course, these operations are not immune to commercial pressures and may well present a bespoke opportunity for building a small number (one to five) of houses without significantly altering their existing and cherished golf product.
So, what is the conclusion? The most challenged golf facilities lie in that broad mezzanine layer sandwiched between the more successful of the traditional member clubs and the mostly poorly located low cost, low price market entries. For some years this mezzanine segment has sought to attract a diminishing number of members using a standard business model and is failing – the commercial response of lowering prices and trying to catch any-and-all business has been ruinous. In this middle sector, those not for profit ‘member-managed’ clubs are typically reluctant to recognise and commit to the scale of market repositioning necessary to be long-term viable businesses. But if they can be shown viable alternatives, some may yet see real estate as the way forward rather than as supping with the devil. More openly promising development partners would be proprietor-owned facilities, who are more easily able to face commercial decisions with reality and a positive attitude less shackled by emotion, EGMs and a hankering for the past, simpler and slower times.
Where perhaps the clearest opportunity lies is where a town has two or perhaps more courses, each offering essentially the same 18 hole product. At least one will wither without investment to improve and diversify their product. That change will almost inevitably require some measure of new real estate as the financial and spatial catalyst. The obvious competitive edge brought on by proximity of rivals ought to help crystallize the need for action and also present the opportunity both to free up some land in the town’s environs for housing but still retain sufficient for golf and other open air leisure.
In our view, insufficient attention has been paid by course owners recently to the wider market of leisure and a coherent integration of leisure time, sport and specific housing needs.
So, how to match people and places for mutual benefit?
We firmly believe this middle sector presents substantial and beneficial opportunities for communities, golf clubs and property developers so all may benefit from imaginative solutions. Mono-use golf clubs need to be exceptional to survive in the 21st century – for many existing golf businesses the future lies in integrating living space with leisure use.
Far better to re-purpose existing courses to better suit a full spectrum of users – be they young, old, teenaged, millennials, middle-aged, male or female. Such re-arrangement can comprise of both downsizing the number of holes (to present shorter time options) but also adding to the variety of golfing interest and options so that the overall golf product may be enhanced in quality not diminished.
When a golf course property is re-configured a much needed diversity of time spent in golfing can be easily offered and combined with options for numerous other activities likely to attract new members, new visiting customers and new residential demand. Instead of cramming 18 holes golf into 120-160 acres, as are most middle sector older courses, far better to devote 80 acres to excellent quality golf and release 40–80 acres for recreation, public access and real estate which has a real connection to its surroundings. Who would not like a menu of, say, dog-walking, cycling, jogging, nature reserves, playgrounds, tennis, swimming and other sports/leisure activities on their doorsteps – all provided in a community environment and with a social hub of a central club building?
Add to this the opportunity for age-banded developments, to ensure communities are balanced, and the possibilities are enormously attractive for family life and a healthy outlook: government is now looking for developers to respond to NHS pressures by building in a need for healthy lifestyles into their master plans. This can offer a viable new lease of life for businesses that are now well past their best years and facing a bleak outlook if they adopt Churchill’s old mantra: KBO.
We foresee the happy circumstance that is a market-driven turnaround solution for businesses and communities that has no losers. The key is to understand how to combine golf estate planning, active leisure and residential communities in a coherent 21st century model – that is our speciality.
With over 2000 golf course businesses in mainland UK it should not be beyond the wit of man and planners to find and implement win-win solutions.
