Times are tough enough for private golf clubs, even those connected to big real estate development projects (especially those).  To attach strings like mandatory membership to buyers of lots adjacent to the community's golf course seems like a rob-Peter-to-pay-Paul proposition in the current buyers market.  A developer with such a policy could wind up selling neither the membership nor the lot to prospects who, in this climate, are not happy being told what they can and cannot do.

    Now, according to an article at the Golf Digest blog site Deeds and Weeds, at least one developer has gotten the message.  A Lake Tahoe golf community builder has decided to sell let the real estate sales take care of themselves.

Membership without ownership

    "The old model for most of these things is to have a highly amenitized real estate project and require a real estate purchase as a condition of membership," said Clear Creek Tahoe Golf Club developer Jim Taylor.  "We're going to try and reach out and invite a great group of members to join -- not obligating them to purchase real estate, [but] simply join the club."

    Necessity is the mother of this invention.  Clear Creek, which opened July 1 and has a total initiation fee of $50,000, has sold just 23 memberships.  "If we required them to buy real estate," Taylor said of those potentially interested in a club membership, "[they] would not consider joining."  This approach, Taylor added in the interview with Deeds and Weeds, "allows us to put together a membership that's driven by the membership and not just because you bought a piece of real estate.  It's a different mix of people."

Clear Creek Tahoe Golf Club has abandoned a plan to "force" new property owners to purchase a golf club membership.  The two-month old course was designed by the well-regarded team of Coore & Crenshaw.  Photo courtesy of Joel Stewart.

The rich get poorer

    Time will tell if the new approach works, but it strikes this observer that business models that force homeowners to buy memberships, or members to live in the surrounding communities, may be approaching extinction.  The Cliffs Communities, the lush string of communities in the Carolina mountains that boasts an upcoming Tiger Woods course, have been successful in forcing homebuyers to kick in a six-figure membership in the golf club after plunking down many more multiples of that for a home site.  But that was in an economy and market far more robust than the current one.  The population of hedge fund manager millionaires has dropped considerably.

    Maybe The Cliffs model is too entrenched to change, but innovative developer Jim Anthony might actually sell more

real estate if he offered, say, $50,000 "non-resident" golf memberships.  If the non-resident members fall in love with the golf -- they very well may, based on my own visits to four of the Cliffs courses -- the chances of a property purchase later would seem higher.  Someone willing to plunk down multiple thousands of dollars in initiation fees is certainly voting with his/her wallet an interest in the area.  Transitioning from club membership to the purchase of a lot nearby seems a more natural and less stressful choice than buying the lot and having 30 days to decide on club membership.

Play first, buy later

    I preach here often about the wisdom of choosing a community where all amenities are either built or where the money has been escrowed to make sure they will be built.  Golf courses are traditionally the first amenity in place in a golf community, but that is no guarantee the course will attract enough members to make it viable.  By joining a golf club before you purchase a lot inside the community, you are hedging your bets.  You can watch to see if others follow suit and populate the club with a full roster of members.  You can also test the golf course over time, making sure that it not only suits your game but also that its upkeep is up to your own personal standards.

    The buyers market forced Clear Creek Tahoe's hand, and it may do the same in a growing number of communities.  Even in those developments where membership has always been mandatory with a home site purchase, or where only residents qualify for membership, it doesn't hurt to negotiate your own deal.  You will find all but the most cash-rich developers ready to at least listen. 

    If you want me to ask the questions for you, let me know what community you are interested in.  Or if you want to chat about what communities might suit you best, I am happy to do that as well. 

    I love the hit TV show Mad Men.  Its insight into the mentality and practices of ad agencies in the 1960s is more interesting to me than its soap opera couplings, breakups and intrigues.  Much has changed in the business since the ‘60s as ad agencies were forced to reinvent themselves almost constantly thanks to changing communication technologies and globalization.  One thing in the business, however, has remained unchanged:  An ad agency never takes on more than one client per industry.  Delta Airlines, for example, would never stand for its agency of record adding American Airlines to its client roster.

     That, of course, is common sense.  An agency with two such clients could favor the one who paid a little more or was easier to work with.  Even if the agency were to serve both clients equally well, where would the competitive edge be for one or the other.  They would both be wasting their fees just to stay even.

     In the realm of golf community marketing, no such conflict exists in the

minds of the developers or the marketers they hire.  Do a Web search using the terms "private golf communities," for example, and you will come up with dozens of sites that promote dozens of golf communities.  Every description of every golf community reads like Shangri La; read enough of them and you get the impression any would suit your every want and need.  Yet when every community is perfect, then none of them are, and the clients are wasting their money.

    Today, I received an email from a firm that markets golf communities.  It was titled, "Four Incredible Communities to Consider for Relocation or Second Home Ownership."  I cringe whenever I see a word like "incredible" or "magnificent" used to describe a golf community.  The Egyptian pyramids are "incredible."  Brigitte Bardot was "incredible" in her day (former teenage boy talking).  The New York Mets winning the 1969 World Series was "incredible."  But a golf community?

The approach to the 8th hole on the Arthur Hills course at Dataw Island Golf Club gives a hint of a community that is well manicured and inviting, and its homes are reasonably priced as well.  But not even the most dedicated resident would claim it is "incredible," nor would any but the most addled resident anywhere say the same about their own community.

 

     The four incredibles in the email are Barefoot Resort in Myrtle Beach (SC), Dataw Island (SC), The Thistle Golf Community (Sunset Beach, NC) and Belfair (Bluffton, SC).  I know all four of them well and have played their golf courses.  I can recommend each as a fine place to live and play.  But all of them fall short of incredibleness. 

     Belfair's nicely landscaped community and golf Fazio golf courses and its canopy of live oaks as you drive in are especially welcoming after escaping the bumper-to-bumper traffic just outside its gates (thanks to nearby Hilton Head's growth over the last few decades).  Dataw Island is beautiful, with reasonably priced homes and two playable designer golf courses, but the community is a good half-hour drive to any town of consequence (in this case, the charming Beaufort).  Barefoot Resort throws a lot of excellent golf at its residents, with courses by Dye, Norman, Love and Fazio, but all the fast food places just outside the gates is a constant reminder of the honky tonk nature of Myrtle Beach.  The Thistle, a community of just 130 homes at completion, almost all of which will face the golf course or a natural landscape, is well located for those who want the beach within a couple of miles, and modern services even closer, but want to feel as if they are many miles away.  Still, Thistle members must share their fine golf course with the Myrtle Beach package players...at least for now.

     There is a lot of hype out there, and some of it is convincing enough to cause people to visit, only to find the community wasn't quite as advertised and definitely not what they were looking for.  Before you invest your own time and money to visit a golf community that sounds flawless, check with independent sources, like local real estate agents.  They generally do not care where you buy, as long as you buy through them.  Or check out some of the online forums dedicated to certain areas of the country.  Local golf communities often come up for discussion, but beware of those posters with axes to grind. 

     Or you can contact me, we can talk about what is important to you in your next home on the course, and I can help you identify what areas and communities best suit your criteria.  I can't quite guarantee you paradise, but then who can?

The live oaks on the drive into Belfair welcome residents, especially after surviving the traffic just outside the gates.