Non-profit, shared ownership golf course - how much would you be ready to invest/pay?

[tgw]

Many golfers in Thailand face high per-round costs at their usual courses, while courses with flat yearly membership fees and no additional compulsory cost per round are very rare.

 

Let's put legal aspects aside and think about how many of us would be ready to acquire a membership in such a golf course and for how much.

 

Project cornerstones:

- conveniently located at a similar distance from the city as other nearest courses (for Pattaya this would mean within the arc between Burapha/Laem Chabang and Cheechan, following route 331 - other locations in Thailand use your imagination)

- minimum 18 holes championship course, not a cheap setup, a good course with good maintenance

- optional carts and optional caddies, no per-round fee for members

- memberships are perpetual, meaning they don't expire. when the membership holder dies, the membership is inherited

- club policies/management priorities/investments set yearly by the member's general assembly

 

Proposed main fee structure for members (theoretically the course should be able to run on minimal maintenance with these fees):

- initial memberships fee for fund setup

- yearly maintenance fee for members

 

So the question here is not about project costs or feasibility, the question is about how much would a resident golfer in Thailand be ready to pay for a membership ?

 

As an additional question, if you have knowledge about golf course economics in Thailand, could you please comment on costs of building an 18-hole course (without cutting corners), land costs and maintenance costs in Thailand ?
Yes, I realize the land cost is very location dependent, but a few ballpark figures would be useful to put things in perspective.

Edited December 4, 2020 by tgw

[scubascuba3]

No idea about costs of building a course, better to buy one that's struggling. Crystal Bay and Mountain Shadow was taken over by the banks a few years back, so timing is important. Pattaya Country Club, isn't great, probably struggling but close to Pattaya but with a membership could be popular. 

 

Optional caddies and cart is essential plus annual membership cost otherwise the whole purpose is dead in the water

Edited December 4, 2020 by scubascuba3

[tgw]

20 minutes ago, scubascuba3 said:

No idea about costs of building a course, better to buy one that's struggling. Crystal Bay and Mountain Shadow was taken over by the banks a few years back, so timing is important. Pattaya Country Club, isn't great, probably struggling but close to Pattaya but with a membership could be popular. 

 

Optional caddies and cart is essential plus annual membership cost otherwise the whole purpose is dead in the water

 

Well, you didn't cast a vote.

Crystal Bay and Mountain Shadow are not within the "convenient arc", I guess that's in part why they are struggling.

 

[scubascuba3]

4 hours ago, tgw said:

 

Well, you didn't cast a vote.

Crystal Bay and Mountain Shadow are not within the "convenient arc", I guess that's in part why they are struggling.

 

I voted, no one else has? golf courses struggle because caddies seem to get more money than them

[topt]

6 hours ago, tgw said:

Let's put legal aspects aside

There's the stumbling block for me. When you then look at what happened with Phoenix its pretty much a non starter for me. Compared to the costs that @scubascuba3 keeps quoting for UK courses the initial membership cost seems high.

 

Also there is no option to vote if you don't support the idea........

[topt]

6 hours ago, scubascuba3 said:

Crystal Bay and Mountain Shadow was taken over by the banks a few years back, so timing is important.

Are you saying they are now owned by the banks again or was this before?

There was a guy on the addicts forum who supposedly was involved in private equity who took over the courses before selling them off to 3 private Thai individuals who I thought still owned them - the other course is in or around Bangkok. A few insights in that thread if the OP wants to find it but I think it was a couple of years ago.

[scubascuba3]

12 minutes ago, topt said:

There's the stumbling block for me. When you then look at what happened with Phoenix its pretty much a non starter for me. Compared to the costs that @scubascuba3 keeps quoting for UK courses the initial membership cost seems high.

 

Also there is no option to vote if you don't support the idea........

Phoenix is different, it wasn't owned by the members it was owned by some wealthy woman last I heard. The idea is members own a course, 51% Thai, 49% Falang I guess

[scubascuba3]

11 minutes ago, topt said:

Are you saying they are now owned by the banks again or was this before?

There was a guy on the addicts forum who supposedly was involved in private equity who took over the courses before selling them off to 3 private Thai individuals who I thought still owned them - the other course is in or around Bangkok. A few insights in that thread if the OP wants to find it but I think it was a couple of years ago.

This was a few years ago so probably has changed hands, it was just an example of buying a course in a distressed state I.e. making a constant loss. 

 

There is a gap in the market for a members owned course

[topt]

7 minutes ago, scubascuba3 said:

Phoenix is different, it wasn't owned by the members it was owned by some wealthy woman last I heard. The idea is members own a course, 51% Thai, 49% Falang I guess

Yes I understand that but i certainly wouldn't pony up anything like £10k (400k baht) for a 51% Thai owned venture.

 

Also to continue with your examples personally I wouldn't want to pay that sort of money for any of those courses but I stress that is just me. 

[scubascuba3]

19 minutes ago, topt said:

Yes I understand that but i certainly wouldn't pony up anything like £10k (400k baht) for a 51% Thai owned venture.

 

Also to continue with your examples personally I wouldn't want to pay that sort of money for any of those courses but I stress that is just me. 

The £10k is a share, which in theory you can sell to a new member. Basically it's the cost of buying/building the course divided by how many members willing to pay up, might end up with a much lower cost. Anyway the legal side is the most complex part plus you'll need 500+ members, which is a lot of organising 

[Lacessit]

A few numbers.

A decent golf course needs about 150 acres of land. That land can only be owned by Thais.

It also needs 600 - 1000 members to be financially viable.  Not necessarily all playing at once, but in terms of annual subs.

18 holes usually needs a ground staff of 12 people to keep it in good condition. Probably more here.

The cost of building a course includes the design fee, normally for top people like Nicklaus, Norman, Faldo, Dye, Trent Jones etc. one is looking at about $1 million USD. Then there's the cost of landscaping. St. Andrews Old Course was basically laid down on the existing terrain, something like Santiburi in Chiang Rai involved a hell of a lot of earth moving.

I have no idea what it would cost to build a golf course here. Working from Australian total costs and labor costs, and adjusting for local conditions, I'd guess about 50 million baht in construction cost, excluding land.

I can remember when Duncan Andrews bought the Cape Schanck  course on the Mornington Peninsula in Melbourne for the equivalent of 45 million baht from the National Bank. IMO he got a screaming bargain. On that basis, negotiating hard with a bank that owns a golf course it doesn't want on its books would seem to be the way to go.

I'm not voting, I just do play for pay now.

 

[Lacessit]

22 minutes ago, scubascuba3 said:

The £10k is a share, which in theory you can sell to a new member. Basically it's the cost of buying/building the course divided by how many members willing to pay up, might end up with a much lower cost. Anyway the legal side is the most complex part plus you'll need 500+ members, which is a lot of organising 

Cost and selling price of shares can fluctuate wildly. The National Golf Club in Melbourne "C" class share started out at AUD 6000. At their peak, they were $40,000. I bought mine for $25,000, sold 10 years later for $12,000.

I did better with my Gymkhana membership, bought it for 40,000 baht, sold for 35,000 baht.

I'm just wondering how many golf courses in Thailand are solvent, because the income from tourism has dried up.

Organising golfers in a club is like herding cats, and about as rewarding. Try as one might, they will always form cliques.

[bkk6060]

31 minutes ago, Lacessit said:

I have no idea what it would cost to build a golf course here. Working from Australian total costs and labor costs, and adjusting for local conditions, I'd guess about 50 million baht in construction cost, excluding land.

Haha.

50 million b is only about 1.6 million dollars.

Nice try that might get you a miniature golf course with windmills and clowns..

 

Earlier this month, the group had an official launch of Siam Country Club Pattaya Rolling Hills, an 18-hole golf course on 660 rai at Siam Country Club with a construction cost of 750 million baht and a land cost of 1.98 billion baht.

[Lacessit]

3 minutes ago, bkk6060 said:

Haha.

50 million b is only about 1.6 million dollars.

Nice try that might get you a miniature golf course with windmills and clowns..

 

Earlier this month, the group had an official launch of Siam Country Club Pattaya Rolling Hills, an 18-hole golf course on 660 rai at Siam Country Club with a construction cost of 750 million baht and a land cost of 1.98 billion baht.

I did say I had no idea, would you mind putting the tar and feathers back in your locker?

[tgw]

1 hour ago, topt said:

There's the stumbling block for me. When you then look at what happened with Phoenix its pretty much a non starter for me. Compared to the costs that @scubascuba3 keeps quoting for UK courses the initial membership cost seems high.

 

Also there is no option to vote if you don't support the idea........

 

1 hour ago, scubascuba3 said:

Phoenix is different, it wasn't owned by the members it was owned by some wealthy woman last I heard. The idea is members own a course, 51% Thai, 49% Falang I guess

 

1 hour ago, topt said:

Yes I understand that but i certainly wouldn't pony up anything like £10k (400k baht) for a 51% Thai owned venture.

 

Also to continue with your examples personally I wouldn't want to pay that sort of money for any of those courses but I stress that is just me. 

 

Again, this thread is not about the legal feasibility. It's about finding out what people would be ready to put into such a club/course if questions of ownership and governance were no issue.

 

Edited December 4, 2020 by tgw

[tgw]

1 hour ago, topt said:

Are you saying they are now owned by the banks again or was this before?

There was a guy on the addicts forum who supposedly was involved in private equity who took over the courses before selling them off to 3 private Thai individuals who I thought still owned them - the other course is in or around Bangkok. A few insights in that thread if the OP wants to find it but I think it was a couple of years ago.

 

interesting, thanks.

[scubascuba3]

1 minute ago, tgw said:

 

 

 

Again, this thread is not about the legal feasibility. It's about finding out what people would be ready to put into such a club/course.

 

If you're serious about finding out make a post on Facebook in the Pattaya golf groups 

Edited December 4, 2020 by scubascuba3

[tgw]

48 minutes ago, Lacessit said:

A few numbers.

A decent golf course needs about 150 acres of land. That land can only be owned by Thais.

It also needs 600 - 1000 members to be financially viable.  Not necessarily all playing at once, but in terms of annual subs.

18 holes usually needs a ground staff of 12 people to keep it in good condition. Probably more here.

The cost of building a course includes the design fee, normally for top people like Nicklaus, Norman, Faldo, Dye, Trent Jones etc. one is looking at about $1 million USD. Then there's the cost of landscaping. St. Andrews Old Course was basically laid down on the existing terrain, something like Santiburi in Chiang Rai involved a hell of a lot of earth moving.

I have no idea what it would cost to build a golf course here. Working from Australian total costs and labor costs, and adjusting for local conditions, I'd guess about 50 million baht in construction cost, excluding land.

I can remember when Duncan Andrews bought the Cape Schanck  course on the Mornington Peninsula in Melbourne for the equivalent of 45 million baht from the National Bank. IMO he got a screaming bargain. On that basis, negotiating hard with a bank that owns a golf course it doesn't want on its books would seem to be the way to go.

I'm not voting, I just do play for pay now.

 

yes, 150 acres would be the necessary space for 18 holes.

 

"that land can only be owned by Thais" is not true, there are numerous exceptions, one of them being BOI companies being allowed to own land they develop. But again, this thread is not about the legal feasibility.

 

obviously, financial viability depends on a number of things, one of them being the membership fees.

 

50 million baht for building the course seems pretty low to me.

[tgw]

4 minutes ago, scubascuba3 said:

If you're serious about finding out make a post on Facebook in the Pattaya golf groups 

 

will do once this thread will have run its course, so we can explore different ideas

[tgw]

21 minutes ago, bkk6060 said:

Haha.

50 million b is only about 1.6 million dollars.

Nice try that might get you a miniature golf course with windmills and clowns..

 

Earlier this month, the group had an official launch of Siam Country Club Pattaya Rolling Hills, an 18-hole golf course on 660 rai at Siam Country Club with a construction cost of 750 million baht and a land cost of 1.98 billion baht.

 

good info!

however, I wouldn't trust these figures too much, they may be out there for fiscal reasons.

[Lacessit]

14 minutes ago, tgw said:

 

yes, 150 acres would be the necessary space for 18 holes.

 

"that land can only be owned by Thais" is not true, there are numerous exceptions, one of them being BOI companies being allowed to own land they develop. But again, this thread is not about the legal feasibility.

 

obviously, financial viability depends on a number of things, one of them being the membership fees.

 

50 million baht for building the course seems pretty low to me.

Yes, I have already been reproved by another poster.

Having said that, I have played on several courses where the natural terrain was used, with very little by way of tee and green construction. St. Andrews Old is the most famous example.

There's a course at Korumburra In Gippsland, Victoria where nearly all the greens are part of the lie of the land. The course is in a bowl which slopes towards the town reservoir, so there are some very quirky breaks on most putts. I've seen those greens drive scratch markers nuts. Quite possible to three-putt from four feet.

 

Edited December 4, 2020 by Lacessit

[tgw]

53 minutes ago, Lacessit said:

Yes, I have already been reproved by another poster.

Having said that, I have played on several courses where the natural terrain was used, with very little by way of tee and green construction. St. Andrews Old is the most famous example.

There's a course at Korumburra In Gippsland, Victoria where nearly all the greens are part of the lie of the land. The course is in a bowl which slopes towards the town reservoir, so there are some very quirky breaks on most putts. I've seen those greens drive scratch markers nuts. Quite possible to three-putt from four feet.

 

Natural terrain still has to be equipped with sprinklers, turf has to be trucked in even if the landscaping is kept to a minimum.

And the greens absolutely need to be made properly if you don't want them to turn into concrete.

The teeboxes are often neglected, but I think uneven teeboxes are pretty annoying.

 

These are things that need to be done properly from the beginning because the cost of re-doing them right later is huge, except maybe the teeboxes.

Another thing a course needs is large water reserves. I remember Bangpra about 3 years ago and it was pretty awful because it had no water. They were lucky to save the course's grass.

 

[keithsimmonds]

 I would support the idea of buy an existing Course rather than building from scratch. Agree on which course to buy then boycott it driving into financial ruin....sorry if that sounds harsh. Member ship fee 500,000baht Maintenance fee 25000

[tgw]

5 minutes ago, keithsimmonds said:

 I would support the idea of buy an existing Course rather than building from scratch. Agree on which course to buy then boycott it driving into financial ruin....sorry if that sounds harsh. Member ship fee 500,000baht Maintenance fee 25000

 

Talking about Pattaya, there aren't many well-located courses which I feel might get sold. Pattaya CC and Parichat come to mind.

I heard Parichat ran out of money some time ago, don't know if they found much fresh money or not.

 

What is Phoenix's current situation? does anyone know?

Edited December 4, 2020 by tgw

[keithsimmonds]

13 minutes ago, tgw said:

 

Talking about Pattaya, there aren't many well-located courses which I feel might get sold. Pattaya CC and Parichat come to mind.

I heard Parichat ran out of money some time ago, don't know if they found much fresh money or not.

 

What is Phoenix's current situation? does anyone know?

I don,t know ...only played it once1300baht walking 3 months ago...it was empty. I do know that i could n,t afford anything from the Pro shop with out a second mortgage. Oh the irony if a group of expats/aliens could take that over. ????

[tgw]

6 minutes ago, keithsimmonds said:

I don,t know ...only played it once1300baht walking 3 months ago...it was empty. I do know that i could n,t afford anything from the Pro shop with out a second mortgage. Oh the irony if a group of expats/aliens could take that over. ????

 

it would have to be a pretty large group anyway!

anyway, it's not about aliens or expats, from what I see in the local Thai tournaments, there would be plenty of local players who would gladly participate.

Edited December 4, 2020 by tgw

[Catkiwi]

Great idea however, perhaps during more settled times. Now is maybe a good time for those that can afford a gamble investment to enter into such a venture but unless you are willing to lose what you invest, a golf course in Thailand, under current circumstances an extremely under utilised facility, be throwing money down the drain. Just saying...

[tgw]

39 minutes ago, Catkiwi said:

Great idea however, perhaps during more settled times. Now is maybe a good time for those that can afford a gamble investment to enter into such a venture but unless you are willing to lose what you invest, a golf course in Thailand, under current circumstances an extremely under utilised facility, be throwing money down the drain. Just saying...

 

If you read the opening post... the course would be financed from shares/membership buy-ins and should be able to run from little more than membership fees, so utilization is not a real concern, all the more so as members are likely to use it because of no compulsory per-round cost.

[Lacessit]

12 hours ago, tgw said:

 

Natural terrain still has to be equipped with sprinklers, turf has to be trucked in even if the landscaping is kept to a minimum.

And the greens absolutely need to be made properly if you don't want them to turn into concrete.

The teeboxes are often neglected, but I think uneven teeboxes are pretty annoying.

 

These are things that need to be done properly from the beginning because the cost of re-doing them right later is huge, except maybe the teeboxes.

Another thing a course needs is large water reserves. I remember Bangpra about 3 years ago and it was pretty awful because it had no water. They were lucky to save the course's grass.

 

You're right, although some of the advances in hybrid grasses have made water less of a problem. I understand there is even one grass that can flourish with a mix of 50:50 fresh water:sea water.

IMO hard greens are good greens. They remain true on the putting line, whereas soft greens have a putt wobbling all over the shop.

[natway09]

The other problem if you pay for a membership fee of this magnitude is that you sorta get tied in to one course & I do enjoy playing a round (excuse the pun)