The Week That Was, august 18, 2013

     Tim Finchem and his fellow empire builders at the PGA Tour are angling to take control of the financially weak European Tour. “Talks have already taken place at an informal basis,” says the Telegraph, which characterizes Europe as “a golfing wasteland as far as professional events are concerned.” The European Tour, which has been drained of life by the continent’s dreary economies, wasn’t able to fill its schedule this year, and it’s been without a chairman for months. By contrast, the PGA Tour is hale and hearty and seeking new worlds to conquer. It already controls the Canadian Tour and PGA Tour Latinoamerica, and it’ll soon have events in China and Malaysia. In a prepared statement, Finchem called the Telegraph’s report “inaccurate” but didn’t deny the tour’s interest in its European counterpart. He also reiterated his belief that “the integration of professional golf can create additional value for our players, sponsors, and fans.” Translation: A World PGA Tour is inevitable.

     After more than a decade of selling hamburgers to hungry Chinese, a former McDonald’s executive has agreed to sell the sizzle of the PGA Tour. Greg Gilligan has agreed to become the managing director of PGA Tour (Beijing) Management Consulting Company, Ltd., which appears to be a newly created entity. He’ll coordinate his marketing and outreach efforts with the tour’s international business affairs and global commerce groups. “We consider China to be an important market for golf and the PGA Tour and believe this is the right time to make an increased commitment to the marketplace,” Tim Finchem, the tour’s commissioner, said in a press release. “We know that establishing a consistent presence in Beijing will enhance our existing business relationships and help to establish new ones.” Gilligan, who speaks fluent Mandarin, has worked in the People’s Republic for 16 years. He’s also served as the chairman of the American Chamber of Commerce in China.

     While golf’s institutional powers ponder ways to make golf fun, the British firm that combined a practice center with a party scene may be coming to a town near you. TopGolf International, Inc., which counts Callaway Golf Company among its investors, has hit on a winning formula by blending elements of a driving range, a video game, a bar, a restaurant, and a concert hall. Its six existing facilities in Texas, Virginia, and Illinois are a proven hit with teenagers, young adults (especially young adult men), and families, so it’s laid plans to open two more this year and perhaps a dozen in 2014. “TopGolf has aggressive expansion plans,” a company spokesperson told a business publication in Sacramento, California, a likely future location. One other thing: No experience is necessary at TopGolf. More than half of the players at the firm’s facilities don’t consider themselves to be golfers.

     Fears over health threats posed by Chinese food are reverberating around the planet, and they’re having a direct impact on golf courses in Hong Kong. Two years ago, the land-scarce territory hatched a plan to build much-needed housing on some of its last remaining farms. Now, after concluding that their primary food supplier can’t be trusted, local residents are thinking that it might be wise to preserve those farms and do the construction on government-owned property currently occupied by Hong Kong Golf Club’s trio of 18-hole courses. The 440-acre site could yield more than 100,000 units. Local elected officials have passed a non-binding motion to develop the property, but the club’s wealthy, well-connected members may be able to avoid extinction by pulling a few strings in the halls of power. Besides, if the club were to close, the future of the Hong Kong Open, one of Asia’s premier annual golf events and an attractive promotional tool for the city, would be in jeopardy.

     The new owners of Newport Dunes at Palmilla Beach have hired Troon Golf to manage their Arnold Palmer-designed golf course. Koontz McCombs, a development group founded by Red McCombs, bought the moribund, 722-acre community in Port Aransas, Texas earlier this year. The property’s master plan calls for the construction of waterfront houses, three hotels, meeting space, and other attractions. A clubhouse is under construction and scheduled to open sometime this fall. “Our goal is to create an extraordinary golf experience at Newport Dunes at Palmilla Beach,” Bart Koontz, the company’s CEO, said in a press release. “We think that Troon is the perfect partner to manage the course, as they bring an unparalleled level of expertise and experience in the golf business.” Troon manages more than 200 golf properties in 30 U.S. states and 27 foreign nations. It has six other properties in Texas, including Cimarron Hills Golf & Country Club in Georgetown, the Rawls Course at Texas Tech in Lubbock, and the Resort at Tapatio Springs in Boerne.

     The city of Minneapolis, Minnesota, whose seven golf courses have been ailing since the onset of the Great Recession, has hired a consultant to diagnose the trouble and, hopefully, find a cure. Don’t expect a miracle, though. Like other municipalities, Minneapolis is stuck between the proverbial rock and a hard place. Its courses need costly capital improvements but no longer generate the income to pay for them. “It’s long overdue,” the superintendent of the city’s park board said of the operations audit being conducted by Jim Keegan. “We’ve not invested in the golf courses. We haven’t changed who we’ve served.” Keegan, of Castle Rock, Colorado-based Golf Convergence, has already identified one major problem. Golf, he told the Minneapolis Star-Tribune, ranks 15th on local residents’ favorite recreational activities.

     The world is collapsing around Jeff Silverstein’s golf operation in greater Charlotte, North Carolina. Last month, Birkdale Golf Club had to close briefly due to non-payment of state taxes. Now, Skybrook Golf Club and Charlotte Golf Links have been taken over by court-appointed receivers and appear to be headed to foreclosure. In addition, lawsuits have been filed by parties seeking payment for overdue bills, and the U.S. Department of Labor is reportedly investigating employee complaints about unpaid wages. Skybrook and the Links are currently being managed by Billy Casper Golf, which will stabilize their operations and prepare them for a likely sale. “We’re getting our arms around the situation,” BCG’s Rich Katz told the Charlotte Observer. Silverstein, the principal of IRI Golf Group and other entities, has faced similar problems with his courses in Texas and Arizona and managed to overcome them. Can he do it again?

     Just months after a $125,000 embezzlement scheme was settled, the members of Oakmont Golf Club have hired KemperSports to manage their property. The semiprivate club, which features a pair of 18-hole, Ted Robinson-designed courses, is the centerpiece of a seniors-only community in Santa Rosa, California. Fairfield Homes, the community’s developer, opened Oakmont as a private club in the early 1960s. Steve Skinner, the CEO of KemperSports, calls Oakmont club “a property with a rich history in the local market,” but many of the club’s members would like to forget parts of it. For 14 months, beginning in 2011, they were victimized by a golf operations manager who was later sentenced to a year in prison. Before KemperSports’ arrival, Oakmont had been managed for nearly a decade by Empire Golf.

     Citing information provided by Mindshare’s Global Sports Index, China Daily reports that there are 39.7 million “TV viewers of golf” in China, “a bigger golf audience than the United Kingdom and the United States combined.” To put this number in perspective, NBC’s Sunday broadcast of this year’s U.S. Open attracted 8.4 million viewers, the largest number since 2007.