The Week That Was, august 17, 2014

     The consolidation of the U.S. golf industry continues, as ClubCorp has agreed to buy Sequoia Golf, a mid-level course owner and operator owned in part by Parthenon Capital Partners. The price: $265 million. “Sequoia Golf aligns perfectly with our business model,” Eric Affeldt of ClubCorp said in a prepared statement. “It is a strong membership business that, like ours, generates nearly 50 percent of its revenue from membership dues.” The transaction is expected to close during the fourth quarter of ClubCorp’s fiscal year, and Joe Guerra, Sequoia’s founder, will serve as a senior adviser to ClubCorp, at least temporarily. Sequoia owns 30 private clubs, leases three, and manages 17. During the 12 months that ended on June 30, it posted a loss of $531,000. With Sequoia’s properties, ClubCorp will have 157 golf and country clubs in its portfolio, along with more than 370,000 members. According to its promotional materials, ClubCorp’s central purpose is “Building Relationships and Enriching Lives.”

     England thinks it doesn’t get the recognition it deserves as a major golf destination, so it’s created an entity to polish its image and coordinate its marketing efforts. “The quality, history, and variety of the truly magnificent golf courses available in England have remained a well-kept secret internationally for far too long,” said Andrew Cooke, the founder of Golf Tourism England, “and this needs to be addressed.” To be sure, England’s golf industry also has economic issues that need to be addressed, as it suffers from the same imbalance in supply and demand that we see in the United States. That being said, England can make a persuasive case to itinerant golfers, as it’s home to 11 of the Golf Digest World Top 100. Among its immediate competition -- Scotland, Wales, Ireland, Northern Ireland -- only Scotland, with 14 courses on the list, has more. The United States, with 40 courses, is the competition’s hands-down winner.

     When we last heard from the owners of Hampshire Country Club, on Long Island, they were holding a knife to the throat of their Devereux Emmet-designed golf course, threatening to end its existence unless they were allowed to build condos on part of it. Now the owners, a group controlled by Westport Capital Partners and New World Realty Advisors, have filed a $55 million lawsuit against the village of Mamaroneck, alleging that their rights have been violated because local officials won’t consider a change to their property’s zoning. “The Village Board has allowed itself to be improperly influenced by a small group of club neighbors who have threatened a protracted and expensive lawsuit if the Board even considered our plans,” one of the owners complained to the Journal News. If they can’t settle their dispute amicably, the parties’ lawyers will duel it out in court in October.

     The new owners of a distressed lakefront community outside Knoxville, Tennessee have hired Troon Golf to manage their Greg Norman-designed golf course. The PNL Companies, a Dallas, Texas-based group that invests in troubled real estate, wants Troon to polish the image of Tennessee National Golf Club, which will be easier to do once PNL builds the community’s long-promised marina and wellness center. Tennessee National, which occupies 1,450 acres along Watts Bar Lake, was initiated by John “Thunder” Thornton, a Chattanooga-based developer, and Medallist Development, a firm created by Norman and Macquarie Bank. A press release announcing Troon’s contract claims that Tennessee National’s Greg Norman-designed golf course -- which features 13 water features, “numerous stacked sod bunkers,” and McMansions along its “perfectly manicured fairways”-- is “reminiscent of Scottish golf course architecture.”

     As much as management companies would have you believe that they can cure all that ills municipal golf, relationships between the public and private sectors sometimes end in unpleasant divorces. The most recent example: The city of Hartford, Connecticut has sued the company that’s managed its golf courses since 2009. In a nutshell, the city alleges that MDM Golf Enterprises neglected the Keney Park and Goodwin Park courses and failed to live up to the terms of its contract. The Hartford Courant reports that the telephone number listed on MDM’s website has been disconnected.

     Billionaire.com, which fancies itself as “the indispensable lifestyle resource for high and ultra-high net-worth individuals who think and act globally,” has identified the 10 most exclusive golf courses in the world. Four U.S. properties made the grade, including the top three: Cypress Point Golf Club (“the world’s most desirable club”), National Golf Links of America (“notoriously full of blue bloods and Wall Street tycoons”), and Augusta National Golf Club (“the course that everyone knows but few have played”). The rest of the list includes another U.S. course (Los Angeles Country Club), two from Scotland, and one each from England, France, Australia, and Japan. The website, which is based in Singapore, took nominations from a group that included Tenniel Chu, the vice chairman of Mission Hills Group.