Trump International Golf Links

Donald Trump, the larger than life US tycoon, struck the first ball on his new Scottish golf course today.

• Donald Trump opened the golf course with Colin Montgomerie and Paul Lawrie

• Menie development sparked a long-running row with environmentalists

• Future of proposed offshore wind farm to be decided by Scottish ministers

The tycoon was piped to the first hole of the Aberdeenshire course and teed off with former Ryder Cup captain Colin Montgomerie, who said it was an “honour” to play the first round on the “marvel” of a course.

Sandy Jones, chief executive of the PGA, and George O’Grady, chief executive of the European Tour, said they would work to bring major golf events to the course.

Regardless of what your thoughts on the tycoon – the pictures (taken by legendary golf photographer Brian Morgan) portray the course to certainly look like one of the world leading links golf courses. What do you think?

You’ve Been Trumped

American tycoon Donald Trump has hit the first ball on his new Scottish golf course on Tuesday.

The building of Trump International Golf Links in Aberdeenshire has been controversial, with environmental campaigners opposing the construction of the course on protected sand dunes and Mr Trump himself complaining about a potential offshore wind farm being built near the site.

The course will open to the public on Sunday July 15 with a series of private events being held this week.

The businessman cut a ribbon on the first tee on Tuesday to mark the opening and hit the first balls with former Ryder Cup captain Colin Montgomerie and 1999 Open champion Paul Lawrie.

More than £100m has been spent on the course and the clubhouse, but further plans for a hotel and homes in the area have been put on hold until a final decision is made on the offshore wind farm proposal.

Trump International said 160 jobs have been created so far with positions in management, catering and course maintenance.

Work on the course began in July 2010 after the tycoon won planning permission to start work on the construction four years after plan were first put forward.

By way of a topical look at the development, take a look at the trailer for the movie “You’ve Been Trumped” released in 2011 (links to the full film are available…).

Golf Consulting: Irish golf industry in deep rough

Author: John Mulligan @ Irish Independent

As Rory McIlroy became the second Northern Ireland golfer in succession to win the US Open last weekend, Taoiseach Enda Kenny said he wanted Tourism Ireland to launch a “massive onslaught” on the American market to lure visitors here.

“I want to see Ireland branded for golfing fans in the US as the home of champions,” he said.

But many golf courses built with attractive tax breaks during the boom are struggling to survive. Some are now controlled by the National Asset Management Agency (NAMA), and market aggressively priced green fees that sustain cashflow but put the squeeze on privately owned courses already battling with the impact of the economic downturn. Between 1990 and 2010, the number of 18-hole golf courses in Ireland exploded from 213 to 352. It has made Ireland one of the most densely populated countries per capita in the world for golf courses. Yet the omens for many aren’t great.

“I’d say about 20 golf courses will probably close over the next few years,” reckons Kevin Markham, a well-known golf enthusiast and author.

Three have closed so far this year — Limerick County; Turvey in Donabate, north Dublin; and Kilkea Castle in Kildare. The price tag of the latter was slashed by receiver Jim Hamilton of BDO earlier this year from €16m to €6m. Among those taking an interest in Ireland’s distressed golf courses is New York businessman Donald Trump, whose son visited Ireland earlier this year to run the rule over some properties. Other clubs that have fallen into the hands of receivers include Citywest in Dublin and the Heritage in Portlaoise.

Aside from the economic woes facing them, Markham claims that many golf courses aren’t even being run properly.

“You’ve got people who are golfers at some clubs and have just worked their way up to running the operation,” Markham claims. “During the good times that was fine, but now they’re not certain how to adapt.”

Even now, he says, many clubs don’t use social networking sites such as Facebook or Twitter which could help them appeal to a younger audience. Among the well-run courses that have had to adjust to the market is Highfield Golf Club in Co Kildare. A former dairy farm, the property has been family owned for nearly 300 years. Nineteen years ago, with farming failing to pay its way, the family made a decision to convert the lands into a golf course and aimed it squarely at the middle market. Avril Duggan, one of the family members who’s involved in the day-to-day running of the club, admits things are tough but says they simply get on with things and try to think laterally to keep the operation on the go.

“You have to be upbeat,” she says. “You can lie down and die or you can do something about it.”

Highfield has had to deal with competition from NAMA-controlled Moyvalley. Designed by Darren Clarke, the course was built by Northern Ireland businessman Alastair Jackson at an estimated cost of €60m. He had lived on the estate for 15 years prior to converting it into a golf course. When it opened in 2006, membership fees were pitched at around €75,000.

Receiver appointed

The annual subscription fee was €3,000. But Moyvalley soon found itself in the rough, and in 2010 Irish Nationwide had a receiver appointed to the development. Today, there’s no joining fee at Moyvalley and the annual subscription fee for full membership is advertised at just €850 for men and €550 for women.

“Courses such as Moyvalley are the biggest threat to us,” says Duggan, adding that Highfield’s own membership levels are down about 30pc since the peak.

“It’s almost like unfair trading. They’re just being run for cashflow. It’s hurting us, but it hurts them, too.”

Costs at Highfield have been “cut to the bone”, according to Duggan, who adds that competition between clubs to attract golfing societies — a significant income stream for most operations — is intense.

“Societies won’t commit to a package any more — now they just pay the green fee and they might or might not have food afterwards.”

Highfield is breaking even, adds Duggan, and offering two memberships for just under €800 — a discount she says has been popular.

In Dublin, Ian McGuinness is the managing director of the upmarket Roganstown Hotel and Country Club in Swords. The land on which it was built was also once a farm owned by the family that now operates the premises. McGuinness is also the current head of the Irish Golf Course Owners’ Association. Despite the downturn, McGuinness says the golf side of things has been holding up.

“We’ve lost members and gained some, and we’ve noticed a lot more transient members who move on to other clubs after a year or so,” he explains. The club has about 400 members. At the peak it was able to sell membership for €10,000. Now, it’s just the annual subscription of €1,439 that applies. Its hotel rates are down between 35pc and 40pc, but occupancy has remained stable at around 60pc.

McGuinness says that 18pc of the overall operation’s revenues are derived from the golf course and that Roganstown made a profit last year before whopping depreciation charges and will do so again this year.

“The business washes its face, but revenues are way back compared to what they would have been,” he says. Those revenues, including the hotel operation, are down about 30pc on 2007 levels. McGuinness is also facing stiff competition from other courses, while its green fees are down from between €75 and €90 back in the good days to between €45 and €55 now. McGuinness also doesn’t regret having the Christy O’Connor Jnr-designed golf course as part of the development, saying that without it, the whole operation wouldn’t be viable.

“If it wasn’t for the golf course we wouldn’t survive,” he says. “We get quite a bit of corporate business out of the airport. If we only had the hotel, this would be a ghost town.”

Since December, McGuinness has only been paying interest on the development’s bank loans.

“We’ve been struggling to pay the capital and told the bank that but they don’t seem to want to know,” he says. He’s in the midst of renegotiating facilities. “I’m going to need some loving care from the bank for the next two to three years,” he adds.

Meanwhile, it’s the links courses that are still the ones really managing to turn a profit, according to Pierce Wall. Based in Tralee, Co Kerry, Wall owns tour operator Ireland Golf, which has been on the go for almost 20 years, and says that many of the links courses he’s very familiar with in the south west are profitable.

“The Americans are back and the market is quite good,” he maintains. “2009 and 2010 were terrible, but I’m up 30pc on 2010 numbers and I already have groups booked in for 2012.” Recent groups included one of 20 financiers from Wall Street, London and Paris who deal with distressed funds.

“Golf is a second holiday for most and when things are difficult it’s the one that gets cut. But things have picked up.”

He says that the number of rounds played at Tralee Golf Club was 6,500 in 2009. This year it’s likely to be 10,000 — almost all the extra play is being generated by US visitors. He’s concerned about the strength of the euro versus the dollar, but concedes that for the bulk of the US visitors he deals with, money isn’t the main object.

He also doesn’t think that President Barack Obama’s visit to Ireland has had any impact on the number of golfing tourists.

“The vast majority of American golfers are Republicans,” he jokes. “They are not going to come to Ireland just because Obama was here.” No doubt Enda Kenny doesn’t care less if they’re Republicans or Democrats — just that they come.

For further information, email me via the Contact section.

Golf Consulting: 8 questions to ask…

Created for G3k Consulting.

It’s the dream isn’t it? That one day you will own a golf club, set up exactly how you want it. A space where you and your buddies can get on the course a play a round on any day, at any time. A clubhouse that stocks your favourite tipple and where you can all catch up after a day on your fairways and greens. However, we all know there is more to owning a golf club and I suggest you ask yourself the following eight questions before taking the plunge.

1.  Is this a lifestyle business or a profit making exercise? Or both?

Either way, you have to start putting some numbers down regarding how it will function. Get your head around all the basic functions required for a golf club – design and construction, environment, operations, management, marketing etc. Decide how each will work and project what you expect in return.

2.  Is the site the best land and location you can find?

There is more to a golf development that just quality holes and stunning scenery. You need a market in the area and you need to provide something different to what that market can already access. Spending most of your budget on digging up every inch of the land to create a course may not be fruitful. Think of the bigger picture.

3.  Is the site reliant on real estate?

If it is overly so, then DON`T do it! Seek advice on what is “overly so”.

4.  Have you got your costs and concept right?

Everything should be double checked with business advisers. Create three scenarios – blue sky, doomsday and the realistic/middle of the road scenario.  If the business can survive the doomsday then you are a step closer to owning a golf club.

5.  Is the designer the right one for the product you need to create?

Whether you go down the route of getting a big name on board or specific consultants, it has to fit your target market. A feasibility study should tell you whether your design is going to work or not. You might get a course with great holes designed by the likes of Monty but if it does not fit the surroundings then it will be money wasted.

6. Is the construction team the right one for the project?

There are many specialist golf construction companies out there so select the one that fits the product you want to create. If you are refurbishing an existing course then make sure disruption is minimal. Construction is not an area that you want to overlook then spend more money (and disruption) further down the line fixing.

7.  What do customers want?

Get together some focus groups, tell them your concept and ask them if they think it will work. Even if you think it’s obvious that it will work, ask the punters. Make sure you ask a group of people who will tell you the truth! This feedback is vital and should be consulted in the planning stages.

8.  Is there a realistic plan in place with contingencies?

All sorts of weird and wonderful situations can occur during the development. What if you discover an archaeological find during the dig? Or an exceptional weather system causes delay? Check your contingency plan with advisers and make sure it is viable.

For further information email me via the Contact section.