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2012 Golf Facility Supply Update

NGF recently released Golf Facilities in the U.S. – 2013 Edition, our annual tally of U.S. golf course development and total golf supply. The report summarizes the nation's total supply of daily fee, municipal, and resort golf courses, as well as private clubs, with numbers broken out by state and region. It also includes the number of golf course openings and closures in 2012, as well as the number currently in planning and under construction.

Among key findings, the report shows that 2012 is the seventh consecutive year that golf course closures outpaced openings. NGF tracked 13.5 eighteen-hole equivalent (18HEQ) course openings versus 154.5 closures, for a net negative of 141. This reduction brought the total number of 18-hole equivalents to 14,671.5, which represents a total facility count of 15,619. (The number of 18HEQ courses is lower than the total facility number due to the large number of stand-alone 9-holers). To put the seven consecutive years of closures in perspective, during the golf course development boom from 1988-2005, golf course supply grew by more than 4,500 18HEQ (over 30%).  Since 2006 when we began to see more closures than openings, supply has contracted by about 3.3% of the total supply in peak year 2004.

Golf course openings remain at historic lows, but given the condition of the overall economy many would be surprised that there are any new golf courses opening. Equally surprising to those who feel new course development has come to a complete halt may be the number of golf course projects under construction. In 2012, NGF recognized 199 courses (18HEQ) in development (either under construction, in planning, or proposed projects). Roughly 73% of these projects are new facilities, with the remainder representing expansions to existing golf facilities (e.g., 9-hole addition).

As the real estate market continues to recover, we may see more closures and fewer developments under construction. High residential inventories and low commercial occupancy rates, combined with a tightening of credit, have stymied some developers who would otherwise be building new courses or eying distressed golf courses for potential re-development. NGF predicts a net change of negative 100 to 150 18 HEQs in 2013, and for at least a few years thereafter.  A gradually improving ratio of supply and demand will help course operators, but not as much as continued good weather!

Other data about the 2012 golf supply found in NGF’s Golf Facilities in the U.S. – 2013 Edition include:

  • Just over 25% of all the golf facilities in the U.S. are Private
  • Almost 19% of facilities are associated with real estate developments
  • There were facility openings in 18 states
  • The South Atlantic region has the most courses in development with 48 (18HEQ) courses under construction, in planning or proposed
  • States with the most supply are Florida, California, New York, Michigan, and Texas.

Click here to download the full report, which is free for NGF members.

Featured Report
Golf Course Transactions Remain Highly Active – What are Investors’ & Lenders’ Transaction Drivers & Expectations?
While new golf facility openings are few, golf course transaction activity has been vigorous over the last six years. From publicly available sources, NGF has tracked nearly 1,300 golf facility transactions since the beginning of 2007, and this number is almost certainly understating actual sales.
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