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| Best Practices: Property |
Master Strokes
Ian Keown
10/01/2005
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Some would-be owners seek to trim their upfront costs by
designing and/or building their own courses. Forsythe brought in equipment and a
crew from his nearby farm to construct the fairways for Canyata. But even with
substantial savings on design and construction costs, owners will find their
odds at getting a return on their investment about the same as those of beating
Tiger Woods at match play. After suffering months or years of planning and
construction, they often wait dozens of business cycles, or even a generation,
before they can show a positive return. Huizenga’s Floridian was actually
intended as the centerpiece of a resort development, but while it was still
being built, his wife, Marti, suggested they ditch his other idea—buying a
yacht—and instead reserve the funds to maintain the golf course exclusively for
family and friends. Huizenga’s playground includes two helipads, two guest
cottages, a four-story clubhouse, a deepwater marina (he now has his yacht, too)
and an adjoining 1,100 acres he believes will make the property more attractive
to a developer if he or his heirs someday choose to sell.
Indeed, many owners
assume that the next generation will be the likely beneficiary of their courses.
Keiser compares owning a golf course to owning a sports franchise. “You lose
money until you sell it; the value of my land, on the other had, has gone up
profusely,” he says. But because these bespoke courses are such exotic beasts,
predicting their future value remains a hazy proposition. Owners should think
twice before making a custom course part of their lasting legacy. Speaking
hypothetically, veteran Rancho Mirage real estate broker Ron Lindemann of
Coldwell Banker wonders how much Annenberg’s nine-hole Sunnylands would fetch on
the market: “Impossible to tell. Only 1 percent of 1 percent of the population
could afford to buy it in the first place, and out of that, you’d have to find a
potential buyer who is interested in golf; otherwise, the buyer might decide to
replace the course with homesites.” Even when the value of the land itself
increases, owners who want to recoup part of their golf course investment in the
short term should be prepared to sacrifice some of their privacy and sell
homesites (see “Name Brands”).
Despite this, golf enthusiasts often seem
content with the idea that their emerald landscapes may become financial white
elephants. They point to the intangible lifestyle and business benefits—family
bonding, camaraderie, privacy, convenience—that a private golf course offers.
Owners can establish their own dress code, their own rules for cellular phone
use and, most importantly, their own membership committees.
Private courses
can be useful in pursuit of owners’ other passions, as well. When Dave and Gail
Liniger, cofounders of Re/Max International, were building their 18-hole
Sanctuary Golf Course at Sedalia, south of Denver, they resolved that their
spectacular 225-acre site, surrounded by unspoiled state and county parks, would
be dedicated to charities. They open their course, free of charge, to 23
tournaments every year. To date, Sanctuary events have raised more than $25
million. Ian Keown has written for Gourmet, the Los Angeles Times, Departures and
other publications. Additional Information
 Name Brands
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