news
Changing landscapes: courses on the move
“The new courses that we are seeing be
built, they’re being built to sell homes and
once the homes are sold, what’s going to
happen to the golf course? They’re probably
going to be in the same position five, ten
years from now,” Orloff states.
Henry Peters
[email protected]
@hsspeters
I
t’s no longer a major surprise to
hear that golf courses in Australia are
selling, moving or merging in what is
an unsettling time for our golf industry.
Melbourne clubs like Chirnside Park and
Eastern, which have relocated their courses
further away from the CBD, may be set up for
brighter financial days but their moves are
symptomatic of what is a troubling period for
the game.
Orloff believes, in Melbourne in particular,
courses moving further away from the CBD
will become a growing trend but warns it is
far from simple.
“Some have done it well, some haven’t and
then five years later they’re back in the same
position. A big move, you’re taking the risk
of losing a lot of your current members if
it’s going to be too far for them. I think it’s a
good investment if you find the right location
and you have enough of a catchment for
people that will support you and what you
purchase it for.”
The changing landscape of our golf
economy is particularly visible in the
Victorian capital. Highly sought-after
property in Melbourne’s suburbs has – for a
number of years – been considered better
served to have houses built on it than golf
courses. Croydon, Eastern, Chirnside Park
and Kingswood Golf Club have all sold or
plan to sell massive portions of their land to
finance a move further out of town.
The Sands Torquay
Peppers The Sands Resort in Torquay and
Moonah Links are continuing their efforts
to sell. Orloff says golf clubs and privatelyowned courses are finding it increasingly
difficult to remain financial.
But there is a simple truth that remains.
There are too many courses in and around
Melbourne and not enough golfers.
“The other route that you’ll probably see a
lot more of is the amalgamations or mergers,”
Orloff speculates.
“The Melbourne (golf ) market is fairly
saturated in certain areas,” says Golf Industry
Central’s Mike Orloff. Golf participation levels
in Australia are slowly declining at present
and this spells greater risk for privatelyowned courses. In April, Heritage Golf and
Country Club in the city’s northeast was sold
for $17.8 million – well below its $30 million
book value.
Housing, accommodation and other
amenities have become part and parcel of
modern day golf course developments. New
courses in the works like Mandalay Golf
Course (Beveridge, Vic) and Black Bull Golf
Club (Yarrawonga, Vic) are good examples of
these.
Meanwhile, Eagle Ridge and the owners of
Orloff admits that new stand-alone golf
courses in Australia are almost a thing of the
past.
“From an investment standpoint, anybody
that knows what they’re doing with golf,
to just build a golf course stand-alone is
probably not a smart thing to do in this
environment. You need housing, you need
other things to build it and then you need
a good business model to sustain it,” Orloff
says.
Heritage’s sale, however, reinforces the fact
that offering on-course properties will not
always guarantee the long-term profitability
of a golf c