Addicted to golf - early birdies drive the best deals

Golf is one of the world’s most popular amateur sports, so it’s no surprise that residential property is now being built around stunning golf courses.

In part because of its exclusive and some might say elitist image, golf is often regarded as a game played by powerful people. The role of the game in deal making is well documented. The author of a new book called ‘Deals on the Green,’ David Rynecki, states that “no matter how sophisticated business becomes, nothing can replace the golf course as a communication hub. It’s where up-and-comers can impress the boss and CEOs can seal multi-billion dollar deals.”

The venerated heads of American conglomerates from John D. Rockefeller, Henry Ford, and Andrew Carnegie were all major golf players. Politicians, celebrities, and wannabe celebrities are also not immune to golf’s glamorous side. The annual Dunhill Links Championship played over three courses in Scotland (Carnoustie, Kingsbarns and the Old Course, St Andrews) pairs celebrity golfers with professionals. The 2006 Championship included Ronan Keating, Hugh Grant, and rock drummer Tico Torres. Catherine Zeta-Jones has gone on record saying that golf is a major factor in her relationship with Michael Douglas. “We spend hours together, all around the world, playing golf,” Catherine revealed. “Some of our biggest discussions are around golf.” Michael Douglas annually hosts a charity golf tournament, well attended by celebrities.

The major centres for golf in the UK are mostly in Scotland as that is regarded by most people as the birthplace of the game. There are over 540 courses in Scotland. St. Andrews Links is a collection of 6 courses around the historic town of St. Andrews and attracts tourists from all over the world. It is estimated that golf tourism brings excess of £120 million to the Scottish economy.

Other centres of golf tourism are around the Myrtle Beach area of South Carolina which has over 340 courses and hosts the annual Hilton Head Island Celebrity Golf Tournament among other major championships. However, the US golf course markets are currently regarded as oversaturated and last year was the first time in six decades that more golf courses closed than opened (146 vs. 119). This is attributed to the perceived difficulty, expense and time consuming nature of the game among beginners.

Spain and Portugal are major drivers of the golf tourism market in Europe, with the Malaga region earning over 900 million EUR from golf tourists in 2006, 15% more than the number two years ago. Countries in the southern and eastern Mediterranean, such as Cyprus, Turkey, and Egypt are starting to attract more investment.

- Overall, Spain has 310 courses
- Generates 2.4 billion EUR annually (indirectly and directly) from 500,000 golf tourists
- Portugal has 75 courses that generate 1.8 billion EUR from 250,000 foreigners
- Average cost of built m² in Portugal is 10-30% less than Spain
- Major issue with water availability in these two countries, environmental sustainability of golf courses
- In May 2004 there were only nine course in Turkey, Turkish Golf Federation plans for 100 new courses in the next four years
- Comparatively lower prices than Spain attracting many investors to Turkey, especially in popular resorts of Altinkum and Akbuk, which will see 7 courses in an hours drive
- In Cyprus there are plans to develop 14 courses in total from the current four

The confluence of golf courses and property is a major property trend in recent years because of the inherent value-added dimension that these developments present. The prospects for rental opportunities are also much higher for these properties. According to a KPMG survey, in developed golfing markets, such as those in Western Europe and in America, the development of a golf course is part of a mix to attract high spending tourists. In less-developed markets increasing the number of people who play golf is the primary goal and thus there is more emphasis on cheap, affordable courses.

- Golf course development projects take on average about 4 years (49 months)
- The average cost of construction of an 18 hole course in the EMA region is 3.56 million EUR, while constructing a 9 hole course is about a third less at 1.23 million EUR
- These averages mask regional divergences: in Eastern Europe an 18 hole course will cost about 1.25 million EUR
- Signature architect design fees are almost five times more than non-signature design fees (1.19 million EUR vs. 0.22 million EUR)

Turkey mad about Golf

In May 2004 there were only nine courses in Turkey. The Turkish Golf Federation has plans for 100 new courses in the next four years. It is worth noting that Portugal has 75 courses that generate 1.8 billion EUR from 250,000 foreigners. Belek in particular is golf central boasting 10 courses within minutes’ drive of each other.

Hand-in-hand with the courses, property developments are also on the increase, creating added value for the owners. One such development is the Royal Golf development in Belek available through Hollingworth & Associates’ HOPSHOP:

- Comprised of 47 Villas and 246 Apartments
- Overlooking the National Golf Club Championship Course
- 5 minutes from the beach, 20 minutes from Airport
- Take delivery of your property in 2008
- Excellent site facilities and luxury specifications

Royal Golf has five golf clubs within two miles and six more planned. The National Golf Club is within walking distance, where resort owners have member privileges. Prices start at £86,122(€126,650) for a two bed, two bath apartment and rise to £201,722 (€296,650) for a three bed, two bath detached villa. All Belek Golf properties are built to the highest standards with air conditioning, double glazing, fully fitted kitchens, travertine flooring and granite work surfaces, all as standard.

For more information on golf investments in Turkey and other destinations, visit hollingworthassociates.com.