Source: Birmingham Post (England)
As golf's Ryder Cup reached its marvellous climax last month, it was time for advertisers in newspapers, on television and on radio to let consumers know of their affiliation with the game. Acres of newsprint and hours of airtime were devoted to companies such as Titleist, RBS and even Quorn ('Since Lee Westwood started eating Quorn he has lost 35lbs') advising us in glorious colour or plain black and white that theirs was the thing for the amateur golfer.
Buried in among this multitude of advertisements was one for the HSBC World Matchplay tournament, which begins at Wentworth on Thursday. There was nothing special about the ad itself; rather, it was the name of the golf course which caught the eye as it is currently at the centre of a takeover battle which, once resolved, could mark the start of a new era for golf development in the United Kingdom.
David Mottram is chief executive of Mottram Golf Inc, an American company planning to open its first European office here in January.
According to his organisation's literature, the company specialises in 'maximising the return for owners from their golfing assets' and sees what it believes to be mostly undeveloped British golf courses as an area ripe for business expansion: 'What's happening at Wentworth shows the extent to which golfing assets have become undervalued since the last UK golf course construction boom of the mid-90's,' he says.
'Wentworth was valued by its owners at pounds 80m, but a bidding war has already pushed the asking price up to nearly pounds 115m. That's over 43 per cent more than the club was officially valued at in the owner's accounts last year. We believe we can add similar levels of value to golf club owners throughout Europe.'
Aside from the World Matchplay, Wentworth is known for being an exclusive golf club, set in a beautifully rolling Surrey landscape. The course is 60 per cent owned by property company Chelsfield, which has asked NM Rothschild to dispose of its holding in order to reduce its pounds 1.6bn debt, incurred when Chelsfield de-listed from the Stock Market and became a private company again.
Within weeks of being offered for sale, Rothschild had four prospective buyers for Wentworth and, not surprisingly, the selling price began floating upwards.
Two Irishmen, billionaire Sean Quinn and former Dublin tax inspector Derek Quinlan, owner of the Savoy hotel group, have each tabled bids of around pounds 100m.
Meanwhile, Richard Caring, a retail entrepreneur and keen golf enthusiast, is believed to have increased his offer to pounds 110m. The final bidder is an Indian hotelier, Surinder Arora, who owns a house overlooking Wentworth's 18th green. The significance of this battle for Wentworth will not be lost on golf club owners across the land as golf courses are currently changing hands at around pounds 15,000 an acre, significantly less than Wentworth'svaluation. Even allowing for differences in regional property values, if Wentworth eventually sells for between pounds 115m-pounds 120m, owners and developers may soon be constructing new courses or upgrading existing ones.
'The benefit of this for players,' say Mottram, 'will be lower green fees. Owners will want to get more people playing golf and enjoying the whole experience of being in a club, particularly one with improved facilities, as it enhances a club's cash flow. In the United States, a fourball can now be expected to spend an average of around $ 100 about pounds 55 a head when they play - on green fees, hiring a buggy, some equipment perhaps, golf balls and golf course 'essentials' such as soft drinks and candy bars.
'Afterwards, players prepare for a drink and something to eat by taking a sauna or having a swim. The interesting fact is this: a decade ago, average expenditure was $ 47 about pounds 26 . Since clubs have upgraded their facilities, mostly without massive capital expenditure, their returns have improved significantly.'
Mottram believes his organisation can combine the best features of new and old golf clubs: 'The new breed of golfer, guys who want to start playing for the first time after seeing Europe winning the Ryder Cup, are actually less concerned about being a member of an exclusive club and care more for becoming a better golfer.
'They want better tuition and advice about playing, which brings its own rewards on the course. At certain times on some continental golf courses, one can find the practice facilities full with the course virtually empty. There is a significant gap here that can be filled by established and newer golf facilities, some of which may even offer academies for entry-level players.' Although the pounds 100m battle for control of Wentworth may feel remote, its repercussions could benefit golfers at all levels for years to come, something which, while not comparable with winning the Ryder Cup, will be excellent news for those of us not quite good enough to have played in it.