Golf courses making changes to stay in business
For close to 90 years, the former Alcoma Golf Club in Penn Hills catered to a small clientele of private members who could play on a noncrowded course whenever they wanted and take long lunches sipping cocktails at the club house while they enjoyed the benefit of writing it all off as a tax deduction.
By the time Art Hawk bought the 152-acre golf course in October 2007, the club’s heyday had just about come to an end. Tax rules had changed. Old club members were dying off, new members were harder to attract and revenue was going downhill.
Mr. Hawk bought the golf course from the other members for $2.2 million, and within a year had turned things around.
He changed the name to 3 Lakes Golf Course and converted what used to be a private enclave for bankers, small business owners and professionals to a public golfing facility where anyone can tee up for about $25.
“We have a lot more players now, being public,” said Megan Hawk, internal auditor at 3 Lakes. “It’s a nice way to keep the community involved in the course. The number of rounds is increasing and more people who play here are telling their friends, ‘The old Alcoma is public now. Let’s play there.’ ”
Golf courses in the Pittsburgh region and across the nation are finding it harder to stay in business in light of more middle-class families scaling back on expenses and tax law changes in 1994 that eliminated or reduced deductions for corporate or individual memberships at private country clubs.
According to the National Golf Foundation in Jupiter, Fla., the total number of traditional golf facilities in the U.S. fell from 16,052 in 2005 to 15,516 in January 2014, of which 11,505 were open to the public and 4,011 were private. The number of Americans playing golf also dropped 16 percent, from 30 million in 2005 to 25.3 million in 2012.
While exact figures on all golf facilities in the Pittsburgh region are not readily available, the state of Pennsylvania had 811 courses in 2006-07, with eight of the state’s most outstanding courses at that time being located in the Pittsburgh region, according to Golf Digest magazine.
A survey conducted in April by the Pittsburgh Post-Gazette showed 127 public golf courses in the region. The daily fee for 18 holes ranged from about $150 at Olde Stonewall Golf Course in Ellwood City to about $15 a day at Bob O’Connor Golf Course in Schenley Park.
The Post-Gazette survey did not include private golf courses.
Today many private courses have had to adapt to changing times. Some have been forced to either open their doors to the public or to shut down, with the land often being sold for housing developments, which is what happened at Venango Trail Golf Club in Marshall and Highland Country Club in Ross.
In recent years, at least four golf courses and driving ranges in the region have been lost to sheriff’s sales, according to court records. One course was sold to a scrap metal company.
One course — Pheasant Ridge Golf Course in Gibsonia — sold oil and gas drilling rights on the 168-acre property for $587,328 to help pay the bills.
Private to public
Meanwhile, several others, like Alcoma, have made the switch from private to semi-private to full-blown public golf courses.
“Golf was such a booming industry here at one time,” said Jason Batchelor, superintendent at Grand View Golf Club in North Braddock, a historically public golf course. “It seems like things starting going in a bad direction almost around the Sept. 11 terrorist attacks when the economy dipped. The first thing people take out of the budget when the economy dips is golf membership.
“But at courses like ours, guys will still play their 9 or 18 holes and not be committed to high membership dues,” he said. “We have weathered the storm better than some of the low-end private golf courses.
But, “we are struggling, too,” he said. “There was a time when they were building new golf courses left and right. But right now there is not a golf course I know of being built east of the Mississippi.”
Not far from 3 Lakes Golf Course in the Penn Hills area, Churchill Country Club also was private at one time until the membership revenue could no longer support the operation. Instead of going the public golf course route, the new owner, Zokaites Properties LP, bought the course valued at $5 million at a sheriff’s sale in February and plans to develop the property for townhomes.
When Mr. Hawk made a bid to purchase Alcoma, two other bidders also wanted the property. One wanted to build a hotel, and the other proposed housing. The club members accepted Mr. Hawk’s bid largely because he wanted to continue the property’s legacy as a golf course.
While private clubs across the region are scrambling to boost their cash flow by marking down membership fees and promoting memberships with no initiation fees, the best known and most selective clubs appear to be the least affected.
Some private clubs in this area that continue to thrive on the old model where new members are handpicked by current members include Oakmont Country Club in Oakmont; Allegheny Country Club in Sewickley; and the Pittsburgh Field Club in Fox Chapel.
But for the most part, private clubs that insist on doing business as usual are finding it difficult.
“The game of golf was part of the success culture,” Ms. Hawk said. “It made people feel successful, especially if they belonged to a private club. They felt they had made it. Now it’s not as closely linked to prosperity. Now it’s more a form of entertainment than a status symbol.”
A lot of modern golf players “want to collect experiences,” Ms. Hawk said. “They want to play six courses in one summer rather than the same one with the same people.”
‘Endless opportunity’
The growing trend of golf courses going from private to public has opened doors for players and club owners.
When First Commonwealth Bank foreclosed on the 82-acre Brackenridge Heights Country Club in Natrona Heights in September 2011, the owners of Tomson Scrap Metal Co. bought the property from the bank in November and turned it into a public club after it had been members-only for 98 years.
The Tomson family renovated the clubhouse and reopened the 9-hole course in June 2013.
“This is a beautiful piece of land. We couldn’t pass it up. There’s endless opportunity here,” said Rubus Tomson, a partner. “We wanted to give this a try and see where it goes.”
The Tomsons charge $15 per person to play on the course, $25 in-season. The fee includes a golf cart.
“We’re not profitable yet,” Mr. Tomson said. “We pay $2,000 a week in taxes. We have to sell a lot of hamburgers and golf to keep the lights on.”
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