The Week That Was, august 7, 2016

     Pacific Links International has sold yet another golf property, this one to a South Korean company that appears eager to become a major player in Hawaii’s golf business.
     PLI, a Chinese/Canadian company that operates an international network of limited-access membership golf clubs, has agreed to sell Royal Hawaiian Golf Club, on the island of O’ahu, to L.A. Koreana, a California-based affiliate of Seoul-based Koreana Hotels & Resorts. Royal Hawaiian features an 18-hole course -- it’s said to be among the toughest tracks in the state -- that was co-designed by Perry and Pete Dye and opened (as Luana Hills Golf & Country Club) in 1993.
     Presuming the transaction closes, Pacific Business News reports that L.A. Koreana will own four golf properties on O’ahu, the others being Hawaii Kai Golf Course, Mililani Golf Club, and Ewa Beach Golf Club. And as fast as it’s been buying golf properties on the island, PLI has been selling them. Royal Hawaiian will be the third property on O’ahu that PLI has parted with since March 2015 (it previously disposed of Kapolei Golf Club and Olomana Golf Links), leaving it with just two (Makaha Golf Club and Makaha Valley Country Club) that will someday become one.
     It’s also worth noting that PLI isn’t just selling golf properties in Hawaii. In recent months it’s also unloaded DragonRidge Country Club, outside Las Vegas, and Pete Dye Golf Club in Bridgeport, West Virginia, and it’s looking to rid itself of other golf holdings. The company is engaged in what amounts to a fire sale.
     PLI hasn’t revealed the price it accepted for Royal Hawaiian, but late last year L.A. Koreana reportedly paid $20.5 million for Hawaii Kai, a 36-hole facility outside Honolulu.

     By now, you’ve no doubt heard that Nike has decided to stop selling golf clubs, golf balls, and related equipment. Sales were bad, and profits were presumably worse. Or, to put it another way, the marketplace spoke and Nike listened.
     Good for Nike. The company’s top executives made the right decision.
     For those of us in the golf industry, however, there’s a worry: Is Nike’s decision yet another example of lingering troubles that we may never shake?
     Not hardly. Nike’s decision ultimately says far more about them than it does about us. Here’s the bottom line: A marginal player has stopped selling golf equipment. No big deal. The history of the golf business is littered with equipment manufacturers that came and went.
     So don’t lose any sleep over Nike’s decision. In fact, we should all revel in it, because, as corporations go, Nike really isn’t much more than an empty shell. It’s a marketing colossus, most certainly, a triumph of branding, but there’s no genius in its products. Nike is to sports what Ralph Lauren was to fashion: Much ado about nothing. Only the gullible believe that a Nike T-shirt is superior to any other manufacturer’s T-shirt, or that Nike has truly developed advanced technologies that can help us run faster.
     When it began selling golf equipment, Nike confronted a harsh reality: Impressionable consumers can wear Nike shoes and Be Like Mike, but they can’t swing a Nike club and Be Like Tiger. The company’s failure in golf should remind us that hype can only take you so far. If Nike’s clubs really helped golfers hit their balls farther or straighter, the word would have gotten around.
     A year from now, hardly anyone will remember than Nike used to sell golf clubs. Sadly, though, legions of consumers will still be buying Nike golf shirts and shoes. You know what they say: If they’re good enough for Tiger Woods . . .

Transactions, august 5, 2016

     Washoe Valley, Nevada. Just months after he let go of his first Reno-area golf course, Stan Jaksick has found a replacement. Jaksick, who turned over Montrêux Golf & Country Club to its members earlier this year, has acquired Thunder Canyon Golf Club, a 22-year-old property that he’s described as “a great facility with the potential to be a premier golf course.” The seller was Gayle Block, who purchased Thunder Canyon with her late husband in 1999. The club, which features an 18-hole, Robert Muir Graves-designed course, opened in 1994 as Golf Club at Lightning W Ranch. It reportedly rang up roughly 14,000 rounds last year, when it operated as a private club. Jaksick has given the property a new name, Toiyabe Golf Club, and opened it for daily-fee play, a move he believes will attract about 10,000 additional annual rounds.

     Prospect, Kentucky. All the leaves are certainly not brown, but that didn’t stop California Dreamin’ LLC from contracting to buy GlenOaks Country Club, in suburban Louisville. The LLC had expected to close on the transaction last month. The Louisville Courier-Journal reports that the seller, an affiliate of Pacific Life Insurance Company, assumed control of the 23-year-old club when its former owner “ran into financial problems.” GlenOaks features an 18-hole, Tim Liddy-designed golf course, and it claims to “work very hard to maintain a friendly, family oriented, relaxed atmosphere at all times.” California Dreamin’ is led by Jamie Miller, a Florida-based professional golfer who’s reportedly developed and managed golf properties “from California to Florida.” Miller hasn’t revealed what he paid for GlenOaks.

     Milledgeville, Georgia. The members of Milledgeville Country Club, which has apparently seen better days, have voted to sell their property to Ted Smith. “The majority of our members have been older people,” the chairperson of the club’s board told the Milledgeville Union Recorder. “We haven’t had the young families, and that’s what keeps a place viable. That’s been one of our big problems.” According to the chairperson, Smith plans to lengthen the club’s George Cobb-designed course and “do a lot of renovations” to its clubhouse. Milledgeville was established in the late 1950s. Smith expects to close on the transaction on October 31. Trick or treat.

     Boonville, Missouri. The city of Boonville has reluctantly agreed to assume ownership of Hail Ridge Golf Course. The city will operate the 18-hole course this year, but it hopes to have a private-sector operator in place next year. “The preference would be no city involvement,” Boonville’s mayor reportedly said in a press release. “But that was apparently not to be.” Hail Ridge opened in 2005. In 2008, its original owners sold it to Jacob, Philip, and Bill Rapp.

     Flushing, Michigan. Can Motown Golf Group and Flushing Valley Golf Course make beautiful music together? Motown, a group led by Angelo Arca, paid an undisclosed price for the 57-year-old golf course in suburban Flint, promising to “definitely improve the golf course.” Flushing Valley appears to be the only golf property currently operated by Motown, which aims to be “the driving force in leading Michigan golf.”

The Week That Was, july 31, 2016

     Over the past year, the value of Donald “the Nominee” Trump’s golf properties has “soared,” according to an assessment by Bloomberg. The news service believes that Trump’s properties are now worth $710 million, nearly double the $375 million estimate they received a year ago. Citing an appraisal done by Cushman & Wakefield in 2015, Bloomberg identifies Trump National Doral Golf Club as the most precious prize in the collection, as it supposedly provides more than half -- $366 million -- of the group’s total value. Bloomberg didn’t provide any valuations for Trump’s other properties, but it fingered his European properties as financial drags, indicating that “they’re all unprofitable.” One other thing: Although Trump insists that he’s worth $10 billion, Bloomberg thinks he’s worth only $3 billion. Peanuts!

     Judas Priest’s former lead guitarist is pressing ahead with plans to make his golf course the centerpiece of a world-class golf resort. Ken “KK” Dowling has been hoping to take his 320-acre estate, Astbury Hall, to the next level since 2010, when he opened its 18-hole golf course. The track has been well received, and the estate seems well on its way to becoming what Dowling once promised it would be: “A top-class golf center with no snobbery.” A couple of years ago Darren Clarke, the captain of Europe’s Ryder Cup team, agreed to serve as the golf club’s “global ambassador,” and now Dowling has taken another step forward, as he’s bought out his financial partners and secured permission to proceed with ancillary development. His master plan for the Astbury, in suburban Birmingham, calls for a boutique hotel, a spa, a restaurant, and other attractions, including another nine-hole layout. “The plan is to put Shropshire on the golfing map,” Dowling told the Birmingham Post, “and it is starting to come to fruition.” The newspaper also reports that Dowling, who got to play many of the world’s greatest golf courses while touring with his band, eventually hopes to bring “top international golf competitions” to the Astbury.

     The original version of the preceding post first appeared in the May 2016 issue of the World Edition of the Golf Course Report.

     The first private-equity golf club in Sin City, and certainly its most colorful, will soon have new owners. The Las Vegas Review-Journal reports that the members of Las Vegas Country Club are weighing four offers for their 120-acre property, the centerpiece of which is an 18-hole, Ed Ault-designed course. The newspaper says that the club, which opened in 1967, is “steeped in tradition,” which in Las Vegas means that over the years its members have included famous entertainers (Frank Sinatra), sportsmen (Andre Agassi), professional stunt men (“Evel” Knievel), local movers and shakers (Mayor Oscar Goodman, the late Kirk Kerkorian), and a parade of mobsters (“Lefty” Rosenthal, Tony Spilotro). The members expect to get as much as $24 million for the club, which sounds like a lot until you remember that Steve Wynn, a member, offered $40 million in 2004.

The Week That Was, july 24, 2016

     Mike Keiser’s golf venture in Scotland has encountered an unexpected setback. Environmentalists in Dornoch contend that the 805-acre Coul Links property is home to an endangered fly, and they’ve petitioned local authorities to prevent Keiser and his partner, Todd Warnoch, from building their proposed Coore & Crenshaw-designed golf course. A few weeks ago, Keiser and his partners reported that their development efforts were “advancing nicely,” and they’re scheduled to have a public meeting about their proposal next month. So far, they haven’t commented on how the fly’s presence might affect their plans, though the situation must be bugging them.

     Royal Troon Golf Club changed its membership policy to ensure that it remains in the rotation for the Open Championship, but the mere presence of women won’t likely bring the event back to the historic venue in South Ayrshire, Scotland anytime soon. This year’s Open attracted only 173,134 spectators, nearly 3,300 fewer than it did the last time it was held at Royal Troon, way back in 2004. The Daily Mail suggests that high ticket prices led to the nearly 2 percent decline in attendance.

     A Hispanic painter has won a court battle against Donald “the Nominee” Trump’s world-famous resort in Miami, Florida. Juan Carlos Enriquez of the Paint Spot argued that the owner of Trump National Doral Golf Club had unfairly failed to pay him nearly $35,000 in connection with work done at the resort’s Blue Monster course in 2014, and a circuit court judge agreed. The ruling: Trump must pay $34,863 to Enriquez and cover $282,950 in legal and other fees that Enriquez had rung up. According to the Miami Herald, during the proceedings Trump’s lawyers tried to persuade the court that the Paint Spot had been “paid enough” for the work it did.

     Nine may be fine, but the European Tour thinks six is the true fix for what ails golf. In an attempt to make the sport attractive to young people, the tour hopes to stage six-hole professional events that would feature music played through loudspeakers during play, a shot clock to quicken the action, fewer clubs in each player’s bag, and, in the words of the Daily Mail, “elements of theater to add to the spectacle.” It appears that the show-biz elements would include non-traditional fashion choices, as Keith Pelley, the tour’s CEO, told the newspaper that the players “would probably be dressed a bit differently.” Here’s Pelley’s justification for the “radical new format,” as the newspaper calls it: “If you’re not prepared to change -- you’re not prepared to be innovative, if you’re not prepared to actually take chances -- then sports will fall behind.” Pelley aims to add the six-hole events to the tour’s tournament mix in 2018.

Vital Signs, july 22, 2016

     Over the next three to five years, will golf become more popular or less popular? The forecast, according to 72 top industry executives surveyed by the National Golf Foundation, isn’t particularly encouraging, as the majority of respondents think golf’s level of popularity will remain about where it is today. The NGF provides no hard data in the wrap-up story on its polling, but it says that “slightly more than half” of the corporate leaders predict “about the same,” while “slightly less than half” predict “more popular.” When the question turns to players and rounds, the responses are similar. About half of the respondents, the NGF says, expect more of what we currently have, while the rest are “biased towards growth.” I view such results as a disappointment and a cause for concern, but the NGF appears to believe that they indicate progress.

     Golf Get Ready may be finding its groove. Last year a record number of adults, virtually of them newcomers to golf, participated in the PGA of America’s eight-year-old grow-the-game initiative. Here’s the story: Get Golf Ready programs in the United States attracted 107,485 players in 2015, an increase of 9 percent over the number enrolled in 2014. Some relevant details from a progress report indicate that 66 percent of the participants were women, 39 percent had never previously played golf, and 24 percent were people from what’s been described as “multi-cultural backgrounds.” These are all positive results. The bigger picture, though, is that Get Golf Ready has had two consecutive good years. If my math is correct, roughly 44 percent of the 465,000 people who’ve taken part in the program since it was established in 2009 were counted in 2014 and 2015. Get Golf Ready still has a long way to go, but it’s on a promising trajectory.