There has been an emergence of new private buyers into the market during the last 12 months, reflecting the strength of the economy and the underlying property asset value.
Recent examples of such sales include Farrington Golf Club, Bristol (in excess of £1.5m), to an asset fund manager with a leading City investment bank. Leaderboard Leisure, the company formed by a founder of Autotrader, added the Nick Faldo designed Chart Hills Golf Club, Kent (excess £4m) to their ownership of Sandford Springs. Wildwood Golf Club, Surrey (£2.5m) was sold to a private London buyer. Strong interest has been expressed in Fernfell Golf & Country Club, Surrey (£2.5m) and a sale to a private buyer is expected. The East Sussex National estate was eventually sold to a private investor reported at a price of £8.5m. FPDSavills state, “We expect these buyers to continue to seek a change of lifestyle following wealth created in the financial and information technology sectors. With this demand and the pool of forced sales drying, the firm market is set to continue.”
FPDSavills acted for Invicta Leisure in the private disposal of their Golf Division to Clubhaus plc, comprising Mentmore Golf & Country Club, Buckinghamshire, Chelsfield Lakes, Kent and Mapledurham Golf Club, Berkshire (£12.2m). Clubhaus now own 14 golf facilities in the UK (20 total) and continue their well-publicised objective of adding health and fitness facilities to their existing golf clubs, with five now open and a further two on stream. Corporate purchasers are still active but less so than in recent times. American Golf (UK) Ltd continue their expansion programme in the UK, increasing their number of UK golf facilities to 20, with leases on Oak Park Surrey, the 45 hole facility at Abbotsley in Cambridgeshire and the freehold acquisition of The Ridge, Kent (£1.75m).
Golf Club Holdings plc have been active, acquiring Penkridge Golf Club, Staffordshire (re-named The Chase), Wickham Park in Hampshire and Ecclestone Park on Merseyside. FPDSavills sold The Lambourne, Buckinghamshire (£7.2m) for the company.
Property Golf and Finance Group Ltd (PGF) has recently announced its first purchase, Horton Park Country Club, Surrey (£3m) and hope to purchase more courses shortly. Golf Course Management Ltd has added a long lease for Edenbridge, Kent to their group.
“We expect considerable group activity in the forthcoming months as they improve their portfolios through acquisition sale and development.” said FPD Savills. “The groups will also add to the value of their operations by improving profit margins. New strong groups will emerge and in addition to freehold sales the trend for leases, especially in the public sector, will continue.”
New developments are still rare and are generally being constructed to compliment an existing operation, such as American Golf’s recently opened Golf Traditions course that adjoins Pyrford Golf Club, Surrey. Queenswood Golf Site, Surrey (in excess £3m) is close to the M3 and M25 and sold to an American concern. FPDSavills are also offering The Chiltern Golf Site, Bucks with 1.8m population within 30 minutes.
“We expect the restricted supply of new developments to continue,” said a spokesman for FPDSavills. “Over the last 3 years demand is currently greater for better quality stock (£2 – £5 million) and we see this trend continuing. Both existing operators and newcomers to the market have become more selective, particularly as to location. There remains a severe shortage of quality stock and consequently yields have hardened for the right product with a mature business. Primary courses are selling at multipliers of 10 – 10.5 on achieved Operating Profits (EBIDT A) and secondary courses at multipliers of 8 – 10. Consequently, values for this sector are likely to out-perform poorer quality courses in the foreseeable future.”