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Golf Course Closures Outpace Openings
The shakeout continues in the American golf industry. According to the National Golf Foundation (NGF), course closures have outpaced openings in the first six months of 2006. There were 57.5 openings (in 18-hole equivalents) against 65 verified closures, for a net decrease of 7.5 courses. In recent years, openings have decreased while closures have increased, resulting in ever lower net increases to supply.
The NGF expects 130-140 18-hole equivalents to open in 2006. And, although it’s difficult to predict, it’s possible that the nation will see upwards of 130 closures, or double the number year-to-date. (In 2005, the number of closures at year-end was double the number at mid-year.) If that happens, the industry will be close to a net growth of zero courses (openings minus closures) for 2006.
Openings year-to-date occurred in 31 of 50 states, with the highest number in Florida (8.5), California (5.5) and Georgia (4.0). Thirty-six holes opened at The Villages in Lady Lake, Fla., bringing to 11 the number of 18-hole courses in this massive retirement community (which has another 18 holes currently under construction). Two of the new new-hole tracks at The Villages are named Bogart and Bacall. (Will the Bogart course be referred to as “Bogey”?)
Daily-fee courses accounted for 49% of openings; municipal 10% and private 41%. On a percentage basis, that puts private club development ahead of the norm – private clubs were 32% of openings in 2004 and 2005. Seventy-four percent of projects were entirely new facilities and 26% were additions to existing courses. Seventy percent were real estate-related. The majority (89%) were regulation length, with 7% executive and 4% par-3 length.
Closures year-to-date occurred in 30 of 50 states, with the most in Florida (9.0), New York (5.5) and South Carolina (5.0). While some high-quality courses do close their doors, closures continue to be primarily older, low-end tracks.
Forty-four percent of closures were “non-traditional” courses – executive, par-3 or stand-alone nine-hole regulation. These included eight nine-hole and six 18-hole executive layouts; 15 nine-hole par-3s; and 22 nine-hole regulation tracks.
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