Cathie Rowand | The Journal Gazette Mike Thomas stands at the entrance of his new housing addition, Silver Leaf Estates on Tonkel Road, which used to be Deer Track Golf Course.
Sunday, November 26, 2017 1:00 am
Golf courses setting new course
Financial woes have owners looking to sell
ROSA SALTER RODRIGUEZ | The Journal Gazette
Mike Thomas doesn't think he's that great at golf. But he's avid enough to play five or six times a week when he's living the snowbird life in Naples, Florida.
So back in the late 1980s, when the long-time Fort Wayne Realtor and real estate developer bought some farmland in northern Allen County, it seemed like it might be fun to build and own a golf course there.
But now, Thomas is behind two recent proposals to turn part of that golf course and another he just bought into something else – housing developments.
These days, he said, golf courses just aren't making enough green.
“What I think is happening with golf – well, what I know is happening – is that young people are just not that attracted to it,” Thomas lamented earlier this month.
“I have 11 grandchildren, and none of them play golf. They play sports, but they play other sports,” he said. “Golf courses are losing money – no matter what they tell you, they're losing money.”
Golf pro Rick Hemstroth, manager of golf operations for the Fort Wayne Parks and Recreation Department's four courses, agrees.
“Golf, over its history, has peaks and valleys, and ... we're in a down cycle right now,” he said.
A big reason is demographics. The “hard-core golfing population” is aging, Hemstroth said, and younger people, despite having grown up or come of age during the glory years of pro golf phenom Tiger Woods, haven't picked up the game.
For one thing, golf can eat up scarce leisure time families want to invest in other pursuits, Hemstroth said. In an age of instant gratification, it takes a long time to become proficient.
“And it's not inexpensive,” he added, noting that may have discouraged individual players during recent recessionary years.
Plus, with the changing composition of the workplace, golf club memberships and outings have become less of a corporate perk.
Maurine Holle, executive director of the Home Builders Association of Fort Wayne, recalled that a few years back, she'd have no trouble packing two-days' worth of players into the group's fundraising golf outings. It's only recently that a one-day outing has come close to filling up.
“It's foursomes (now), not sixsomes,” Holle said. During the recession “incomes were less, and things (like golf perks) got cut back,” she added, and they haven't returned.
As a result, although nearly 25 million Americans play golf, according to the National Golf Foundation, golf courses around the nation and region in the last 10 years have been shutting down.
Between 2006 and last year, about 6 percent of existing U.S. courses closed – a situation the foundation in Jupiter, Florida, gently refers to as “contraction” caused by an “oversupplied” market. The closings amount to hundreds of courses, according to the foundation.
The decline is especially striking because the game had experienced a 20-year growth spurt between 1986 and 2006, when the number of courses grew by 44 percent, the foundation reports.
Other findings: Closings have hit public and lower-priced courses the most because of narrow profit margins. Most hard hit have been Florida, Michigan and Texas, where growth was greatest.
But that's not all influencing course closings, the foundation reports. “Strong commercial and residential real estate markets continue to create demand for course properties and some owners will accept (purchase) offers as an exit strategy.”
The Fort Wayne area hasn't been immune.
In the 1990s, Fort Wayne area home builder and developer Roger Delagrange not only opened and owned Cherry Hill and Autumn Ridge golf clubs but also built upscale housing developments bordering them as an amenity.
But it's now harder to make a profit on golf, he said, acknowledging the Fort Wayne area might qualify as one of those “oversupplied” places.
“It's been tough in the last six or seven years,” he said. “We have a lot of golf courses and not players.”
Delagrange and others familiar with golf or development can point to at least eight courses that have been sold for other purposes or are on the market.
The former Grey Goose course near Decatur closed in 2010 and is now home to New Hope Church. Auburn's Greenhurst Golf Club, with a classic course dating to the 1920s, closed in 2013. Two philanthropic businessmen's foundations bought it for what county records say was a little over $1 million, and in June, the ground was reopened to the public as a park.
Orchard Ridge Country Club in Bryan, Ohio, also closed in 2013. And this year, Indiana Tech announced it was buying the Donald Ross Golf Course on the south side to use as a women's softball field and track facility. The purchase followed community objections to a plan to use Memorial Park for the project.
The course's price was not disclosed, but www.LoopNet.com, a popular nationwide online commercial real estate site, has listed it for $990,000.
LoopNet also lists Stonehenge Golf Club on Pierceton Road in Winona Lake as for sale for $2.875 million. The 228.5-acre public-course property includes 18 holes, a driving range, practice green, pool, and clubhouse with a lounge, event rooms and a liquor license.
Meanwhile, Thomas is now working on an upscale single-family housing development on what was the front nine of the former Deer Track Golf Club, the course he started working on in 1987 in Perry Township.
Already, the front nine is nearly filled with houses in a development called Deer Hollow.
Oakmont Development, co-owned by Thomas and his son Jeff Thomas, also recently received approvals to turn Willow Ridge Golf Club in the Huntertown area of Perry Township into more single family homes.
Planned is an approximately 300-lot single-family housing development with two parts, one with 99 lots and eligible for U.S. Department of Agriculture financing, and the other with homes starting at around $350,000, he said.
Homes at Silver Leaf Estates are expected to have an entry point of $450,000 and, like Deer Hollow, will require buyers to put in and maintain their own wells. Silver Leaf lots have public sewer, Thomas said.
Those familiar with local building conditions said older golf courses tended to be built on land only suitable for low-intensity uses because it lacked infrastructure. But now sewer and water lines have in many cases caught up, making more areas open to housing.
Thomas said he thinks tougher laws about drinking and driving, while a good thing for society, have cut down the profitable social aspects of running a golf club.
But a big factor is that land is just becoming scarcer, Thomas said.
“There's a lot more demand for houses,” he said, “than a golf course.”