Sunday, March 12, 2017

The Week That Was, march 12, 2017

     You can scratch Mike Keiser’s name off the list of potential suitors for Cape Wickham Links. The renowned track, on King Island in Tasmania, is for sale (reported asking price: about $15 million), but the Chicago, Illinois-based developer of such destination-worthy resorts as Bandon Dunes and Cabot Links has zero interest. Keiser has three objections. First, the price is too high. “I can probably build one cheaper,” he acknowledged in a recent conversation. Two, he thinks the location is too remote for North American golfers. While Keiser was building his courses at Barnbougle Dunes, he visited Tasmania twice a year, but these days such a journey has become too exhausting. “I no longer relish the trip to Melbourne,” he concedes. Three, Keiser’s true calling is development. “I won’t buy courses,” he explains. “Finding sites and building on them is too much fun.” On this point, it’s worth noting that Keiser recently passed on a pair of development opportunities on King Island. Today, at the age of 72, he prefers to stay closer to home.

     Though he’s cutting back on his travel, Mike Keiser did recently book a flight to the other side of the world, specifically to New Zealand’s North Island. While there, he played Tom Doak’s course at Tara Iti, and it took his breath away. “It’s the most beautiful golf course I’ve ever seen,” he gushed to me last week. The encounter reminded Keiser of Doak’s considerable architectural talents and led him to tell the Traverse City, Michigan-based designer to get cracking on a routing at Sand Valley. Doak expects to deliver his proposal this summer. Keiser is considering the track for Sand Valley’s third course, along with a layout by Mike DeVries and a Harry Colt tribute layout that would be designed by Coore & Crenshaw. If you twist his arm hard enough, though, Keiser will admit that all three courses will probably find a home at Sand Valley someday.

     The CEO who brought the World Golf Championships to Mexico City is looking to build on his accomplishment. As part of a grow-the-game initiative, Benjamin Salinas of TV Azteca has established the nation’s first First Tee program, and he’s formed a group that aims to build its first daily-fee golf course. “It is a dream that we hope will grow,” Salinas told the Golf Channel. Regarding the proposed course, which would take shape somewhere near Tijuana, Salinas said it would emerge “with the help of the [Baja California] state government” and that he’s enlisted a group of “businessmen who are ready to pay for it.” Salinas concedes that he and his partners are “starting from scratch,” but look at the big picture: Mexico has nowhere to go but up.

     The mainstream golf media has enthusiastically touted the election of our nation’s Jekyll & Hyde President, but perhaps they have another think coming. Citing data from travel companies and travel-research firms, the New York Times says that the demand for travel to the United States “took a nosedive” in the wake of the failed Muslim ban in January. “Prior to the ban, the U.S. was one of our best-selling destinations,” a spokesperson for a British tour operator told the newspaper, “but our customers are now choosing to travel to other countries.” This is troubling, because tourism creates jobs (7.6 million of them in 2015) and contributes more than $1.5 trillion annually to the U.S. economy. Without putting too fine a point on it, what we’re seeing here should remind us that government policies inevitably have unintended consequences. A lot of people in golf support the president’s anti-immigrant agenda, but did they foresee an accompanying decline in travel to our shores? And what’s worse for the golf economy, a minuscule threat of terrorism or a significant decrease in bookings at resorts like Pebble Beach and Pinehurst? Our business has been forced to fight through great challenges in recent years. Now, as our financial prospects have brightened, we don’t need boneheads in government to create new problems for us.

     Escalante Golf has closed on its expected purchase of Kingsmill Resort, a venue that it believes is “one of the most iconic resorts on the East Coast.” The Fort Worth, Texas-based owner/operator reportedly paid $29.3 million for Kingsmill, which features two 18-hole public courses (one designed by Pete Dye, the other by Arnold Palmer and Ed Seay) and a private club that features an 18-hole layout bearing the “signature” of Curtis Strange. The centerpiece of a 2,900-acre community in Williamsburg, Virginia, Kingsmill was created by an entity related to Anheuser-Busch Company in 1969. The beer conglomerate sold it to Xanterra Parks & Resorts in 2010, reportedly for $24 million. With the purchase, Escalante now owns 16 golf properties in nine U.S. states.
     Other notable transactions . . .
       -- Lon Tabatchnick, the developer of a Jimmy Buffett-themed gathering spot in Hollywood (Florida, not California), has agreed to buy Weston Hills Country Club, in suburban Miami. Weston Hills features a pair of 18-hole, Robert Trent Jones-designed golf courses that opened in the 1990s, and it’s currently owned by an entity affiliated with Arcis Equity Partners, which is bankrolled by a New York City-based investment group. Tabatchnick hasn’t revealed the price he intends to pay for Weston Hills, but Arcis coughed up $14 million for it in 2014.
       -- In January, Festiva Real Estate Holdings acquired Wachesaw Plantation East, a venue outside Myrtle Beach, South Carolina. The property features an 18-hole, Clyde Johnston-designed golf course that opened in the mid 1990s.

     All that Ian Poulter-branded apparel that nobody wants to buy is about to become collectible. The British professional golfer has “with great sadness” pulled the plug on IJP Design, the entity that produced Poulter-endorsed clothing and accessories not just for men but for women and children as well. In an announcement explaining his decision, Poulter blamed his line’s demise on “an ever increasingly competitive landscape,” which is now unfortunately littered by a long parade of multinational corporations (Nike, Under Armour, PGA Tour) and corporations masquerading as people (Jack Nicklaus, Greg Norman, Ralph Lauren). If truth be told, this ego-driven business is overdue for a shake-out. In fact, if there was a czar of apparel merchandising, he’d probably treat golf branding the way our government now treats environmental regulations: He’d close two before approving a new one.

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