The Week That Was, october 27, 2013

     The overall U.S. economy may still be in a funk, but wealthy Americans -- the golf industry’s best customers -- are spending money again, particularly on high-priced extravagances such as luxury automobiles, Harley-Davidson motorcycles, and recreational and all-terrain vehicles. “If you have a home and a stock portfolio, things are looking better,” an investment analyst told the Wall Street Journal. Citing U.S. Labor Department figures, the newspaper reports that the average American household spent $51,442 last year, an amount that surpasses the pre-recession peak. “I think people feel a little more secure,” said Winnebago’s sales manager. “The nerds and geeks are making tons of money,” said an economist at a Boston-based research firm. “We feel good about the fourth quarter,” said Whirlpool’s CEO. Although reading such tea leaves is risky business, with each passing day the evidence mounts: The foundation for a rebound in the golf business is being laid.

     The Chinese may be getting serious about protecting their dwindling water resources. Six golf courses in Beijing, a city suffering from a drought, have been forced to close because they were “threatening the local water source in their respective areas,” according to China Radio International. The names of the courses haven’t been announced. A website called Beijing Golf Courses says that the capital city has between 60 and 73 courses and that local water officials have heretofore turned “a blind eye” to their water use.

     Most companies in the golf industry continue to sing the Great Recession blues, but not Gary Player’s. Marc Player, the CEO of Black Knight International, tells Forbes that his father’s various golf endeavors will generate $36 million in revenues this year -- way more than the $14 million he earned during his 60-year career as a professional golfer. About one-third of the money ($13 million) will come from corporate sponsorships, licensing deals, and real estate ventures, Marc Player reports, but the rest of it is said to be coming from Black Knight’s golf design division, which offers three levels of service priced from $1 million to $3 million. As Forbes notes, the design division’s claim to $23 million in income is certain to raise eyebrows among golf course architects, whose fees have been drastically reduced in recent years. Without question, Player Design is busier these days than some of its rivals, but if a Gary Player “signature” layout can command $3 million in the international marketplace, then the firm’s main competition -- Jack Nicklaus and Greg Norman primary among them -- are going to have to drive a harder bargain.

     The 95th PGA Championship was worth more to metropolitan Rochester, New York than anticipated. Greater Rochester Enterprise has determined that this year’s championship, which was played at Oak Hill Country Club, had an “economic impact” of more than $102 million, considerably more than the $78 million that had been expected. The economic-development agency says that the event attracted roughly 225,000 spectators, filled more than 4,900 hotel rooms, and generated $28 million in sales from tickets, concessions, merchandise, and corporate tents.

     Another casualty of the Great Recession is being revived. Hunter’s Point Golf Course, in Nampa, Idaho, which was shuttered by financial troubles in April 2012, is being re-designed by a new ownership group and is expected to reopen in the spring of next year. Canyon County Golf Partners, which acquired the 150-acre property from M3 Corporation, reportedly includes Clint Travis and Jerry Breaux, the operators of BanBury Golf Course in Eagle, TimberStone Golf Course in Caldwell, and River Birch Golf Course in Star. Hunter’s Point was designed by Gene Bates and opened in 2009. The Idaho Press-Tribune reports that the new owners plan to change it “from a challenging private golf course to a public course with more of a fun factor.” They also plan to rename the course, but they haven’t yet revealed the new name.

     The park commission in Morris County, New Jersey has decided to seek a private-sector operator for three of its golf properties. The commission plans to privatize Flanders Valley Golf Course in Flanders, Sunset Valley Golf Course in Pompton Plains, and Pinch Brook Golf Course in Florham Park, whose losses have helped to put the county’s golf operations into a $2 million hole. The commission’s chairman, John Sette, told the Newark Star-Ledger said the transfer of operations is necessary because “golf revenue isn’t what it used to be.” Last year, the commission turned over its other golf property, Berkshire Valley Golf Course in Jefferson, to Billy Casper Golf.

     Seven golf management companies appear to have a serious interest in operating the city of Prescott, Arizona’s golf courses. Antelope Hills Golf Course has been losing money for much of the past decade, according to the Prescott Daily Courier, but the 36-hole facility (it features courses designed by Lawrence Hughes and Gary Panks) has nonetheless attracted the attention of a group that includes Billy Casper Golf, KemperSports Management, OB Sports, and Touchstone Golf. The newspaper says that the complex has been forced to borrow more than $4 million from the city’s general fund. The city, which will continue to maintain the complex, is offering a 10-year contract. It expects to have an operator in place in February 2014.

     Spain remains the favorite destination for traveling golfers from select parts of Europe, according to a survey commissioned by Reed Travel Exhibitions. Spain was the top choice among 28.5 percent of the respondents from the United Kingdom, France, Germany, and Scandinavia who took a golf vacation within the past 12 months. The runner-up was Portugal (17 percent), followed closely by Great Britain and Ireland (16 percent) and distantly by Turkey, France, and the United States. The typical golfer who visits Spain spends between $234 (by the British) to $317 (by Scandinavians) per day and plays between five and six rounds of golf on as many as four courses during his or her holiday.

     Sensing a career opportunity, the head of Thomson Perrett & Lobb’s architectural practice in Cape Town, South Africa has hung out his own shingle. “Africa is a huge potential market for golf and will give rise to some amazing courses in the future,” believes Andrew Goosen, who’s chosen to operate as Morris Golf Company. In a press announcement, Goosen explains that “classical principles of golf design” -- he cites Harry Colt, Alister MacKenzie, and Old Tom Morris as inspirations -- will serve as the foundation for his work. “I want to build courses that are strategic and that reward bold, high-quality play while still being a fun day out for ordinary players,” he said. “Africa does not need a flood of huge ‘championship’ courses that are unplayable for anyone who is not highly skilled.” Goosen is currently working on projects in South Africa and Swaziland.