Midterm grades are in for 2019, and the golf industry is close to being sent home on academic probation. Even taking into account that spring was pretty wet in much of the country, rounds played in June, according to Golf Datatech’s monthly industry report card, still were flat compared to the same month in 2018, and year-to-date participation in the first half of the year was down 1 percent when measured against the first six months of last year, making golf a C performer - at best. It is a trend that is all-too familiar.
The inventory of golf-playable-hours was down 7 percent nationwide in June. A metric devised by Jim Koppenhaver at Pellucid Corp., GPH is essentially an inventory of the number of hours in a given time that are favorable for playing golf that accounts for factors such as daylight hours, precipitation and temperature. Granted, nationwide weather data is pretty useless, but it tells us that many parts of the country took on a lot of rain in the spring. A lot of rain. And flat growth tells us that, overall, there are no more people playing golf now than a year ago. In fact, if history tells us anything, we probably will find out that there are a million or so fewer golfers among us by January, when Koppenhaver and Stuart Lindsey of Edgehill Consulting deliver their brutally frank state of the industry address at next year’s PGA Merchandise Show in Orlando.
Conditions have largely dried out since spring in many of those areas that experienced wetter-than-normal weather to kick off the golf season, but the rebound many owners and operators had hoped for has not been there. Of course, there are going to be pockets of success since progress is measured on a course-by-course basis, but the overall bump signalling that we finally have reached equilibrium between demand for rounds played and supply of golf facilities has not yet arrived.
The biggest losses in June were in Kentucky (down 18 percent) and Alabama, Arkansas, Louisiana, Mississippi and Oklahoma (all down 14 percent). Play also was down in several golf-centric states like New York (7 percent), North Carolina (6 percent), South Carolina (4 percent), Florida (2 percent) and Pennsylvania (1 percent).
The biggest gains in June were in the Dakotas (up 14 percent), Virginia and West Virginia (11 percent) and New Mexico (10 percent), none of which are going to have much of an influence in overall numbers. California saw a gain of just 0.6 percent.
The biggest year-to-date losers for the first six months of the year were again Arkansas, Louisiana, Mississippi and Oklahoma (all down 10 percent). The largest gains in the first half of the year were made in Delaware, Maryland, Virginia and West Virginia (up 14 percent), the Dakotas (up 12 percent) and New Jersey (up 11 percent).
What many in the industry thought might be a brief trend that would last just two or three years, has turned into a movement that has carried on for a generation and has redefined the business.
The golf business underwent tremendous growth in the 60 years following World War II. What soon became an oversaturated market quickly began to self-correct by shedding underperforming courses and hastily planned layouts designed to help sell real estate.
What many in the industry thought might be a brief trend that would last just two or three years, has turned into a movement that has carried on for a generation and has redefined the business.
Since 2006, 2,135 golf courses have closed, while 620 have opened for a net loss of 1,515 18-hole equivalents. Included in that are 41 closures and 10 openings so far this year. One unexpected statistic that has become a welcome trend in recent years is once-closed courses reopening under new ownership. According to Koppenhaver, there are 10 such properties that have reopened this year.
Among the courses scheduled to close this year is Santa Clara Golf and Tennis Club, a 1987 Robert Muir Graves design in Silicon Valley that will be shuttered to make room for an entertainment complex adjacent to Levi’s Stadium, the home of the San Francisco 49ers. The course is set to close Oct. 15. The list also includes the Country Club at Deer Run, a daily fee in Casselberry, Florida that succumbed in June to the challenges of competing in the crowded Orlando market.
One thing we know, is that there will be dozens more before the end of the year as the market continues to self-correct with no apparent end in sight.