By: Rob Harris
Over the past several years we have discussed many lawsuits involving golf course owners’ desires to transform the use of the property into something that will generate better returns (or avoid losses). Frequently, there is pushback from neighbors, from members, and from local governments.
I commend to those interested an article by Pat Clark at Bloomberg that discusses the issues raised by these disputes and market forces. As Clark explains:
“More than 800 golf courses have closed nationwide in the last decade, as operators grapple with declining interest in the sport and a glut of competition. Many of those shuttered courses were built on land proscribed from redevelopment by local zoning codes seeking to preserve open space—or…by deed restrictions intended to protect homeowners who had paid a premium to live near a golf course.
“That leaves some golf course owners with the real estate equivalent of an unplayable lie: They can’t make money running the course, and they can’t recoup their investment by selling it….
“In the face of declining interest and competition driven by oversupply, course owners have gone searching for ways out. Some have donated golf course land to nature trusts and local parks, taking a tax break in return for preserving the open space. Others have inked deals with homebuilders—though those deals are often contingent on winning approval from homeowner associations or local governments.”
The full article is available here.