From Mike Kahn, golf course business consultant: Is your community golf course failing?
Do not let your community golf course fail!
To All Home Owner's Associations
Uncertainty, Falling Home Values, Tougher to Sell a Home, Rise in Crime, Unsightly Surroundings.
Call me: 941-739-3990, or write: firstname.lastname@example.org
The impending failure of a residential golf course and its negative affect on property values is becoming more and more prevalent in the USA (2012). On the evening of January 17, 2012, I attended and spoke at a Home Owners Association meeting held in the clubhouse at Turkey Creek Country Club and Residential Development in Alachua, Florida. Alachua is located just north of Gainesville, Florida accessible about five minutes east off I-75.
Turkey Creek is a residential development of 1,100 residences made up of a mix of town homes, zero-lot lines, single family middle priced and single family $500,000+ homes. You can Google the development using Google maps to gain an aerial view of the property and golf course using this address: 11400 Turkey Creek Boulevard, Alachua, FL 32615.
THE GOLF COURSE HAS BEEN CLOSED SINCE MAY OF 2011.
We have known that failed golf course communities have put more pressure than normal on home values in golf course communities, but there has been no real national data available (that we can find) to collaborated the notion that a failed golf course in a golf course neighborhood will impact adjacent home values. However, it was clearly evident that property suffered greater at Turkey Creek than non-golf course residential properties.
Here's what happened at Turkey Creek and why:
Based on sales in Turkey Creek and the area from actual real estate data, house prices fell an average of $21.00 a square foot at Turkey Creek in 2011 over 2010 ($112.00 sq ft in 2010 down to $91.00 in 2011).
Data from a local real estate brokerage firm provided the following 'real' data:
I took a snapshot of the above chart. See overall County and Country Club square foot prices stayed pretty well the same through 2009, 2010, and 2011 while Turkey Creek prices dropped from $112 to $91 from 2010 to 2011.
Sales were also down compared to the surrounding neighborhoods with a comparison to the nearby Country Club.
Sales at Turkey Creek dropped dramatically in 2011 over 2010 from 57 to 24 homes. The Country Club with fewer but higher priced homes dropped by over 50% but the experts at the HOA meeting suggested the numbers from the Country Club may be too small to be significant. Interesting that the Country Club square foot values actually increased in 2011 from $92 to $97 a foot.
WHAT'S THIS MEAN TO YOU AND YOUR GOLF COURSE RESIDENTIAL HOMES AND THE COMMUNITY?
Although, there are apparently no major national statistics available (known to date), the experience from place to place where the residential golf course fails, clearly indicates a trend - a more dramatic drop in property values. For instance, when the Ravines Golf Resort in Middleburg, Florida, closed a few years ago, the residents reported their home values dropped (coincidentally) by $20.00 a foot. The experience at Ravines came up at a meeting with another HOA group in a Green Cove Springs (Florida) golf course community.
[The 850 home owners at Green Cove Springs agreed to require all home owners to pay a monthly social membership to provide sure support for the golf course.]
Before the HOA meeting at Turkey Creek I inspected the golf course, the clubhouse, swimming pool and tennis courts. The entire property was overcome with shoelace deep brown dry grass infested with weeds. The greens needed all new grassing. The fairways, and tee boxes, occasionally mowed since closing with deck or flail mowers still had a chance to recover with continued mowing, fertilizer and water. The sand traps had weeded over, but still can be salvaged. The clubhouse landscaping had deteriorated. The swimming pool and tennis courts needed a face lift, but appeared structurally sound. I saw trash and garbage lying in the parking lot - a sure sign of neglect. Closed since last May, I estimated it would cost at least $500,000 to bring the Golf Course and Amenities back to respectability.
An officer from the Alachua County Sheriff's office spoke at the Turkey Creek HOA meeting and reported a quite dramatic increase in criminal activity from the date the golf course closed for business.
Without elaborating on the various crime incidents that included home invasions, the officer stated that the number of crime report pages jumped from 13 in 2010 to 23 in 2011 - the year the golf course was closed. He cited fewer eyes means greater crime. When the golf course closed fewer people, fewer lights, no traffic provided a more inviting criminal environment.
Law enforcement was not surprised at the increase in crime after the golf course closed for business.
An abandoned golf course is a sorry sight. What is worse is often trash and garbage that accumulates around the clubhouse and parking areas. Eventually rats, raccoons, snakes and other creatures attracted to garbage become evident.
Around the clubhouse weeds and overgrowth take over the landscaping and walkways. Without immediate care, the property and structures begin to deteriorate very quickly. The inside of the clubhouse starts to mildew when there is no electricity or air circulation. Some say in Florida it takes barely a month of stagnant air in a building for it to mildew and rot within. Often, it becomes unusable and may need to be torn down and replaced.
What can be done?
There are several ways to save the golf course and the community but the non-golfers who own homes in the development have to participate.
How do you get through to the non-golfers and their attitude? Everyone who own property in the golf course neighborhood has one thing in common: All have an interest in the value of their homes. The board has to start from there.
What is a closed or abandoned golf course worth?
90% of THE TIME - ABSOLUTELY NOTHING!
I am not the solution. You are. I am an adviser.
Call me: 941-739-3990, or write: email@example.com