Montgomery Village course owner says private golf market is sinking
Survival of 18 holes is a long shot
The Montgomery Village Golf Course will not get a mulligan, according to course owner Jack Doser.
As Doser works with developers to build on part or all of his 6,700-yard course, he wants neighbors who love their green views to know that it's not just him; private course owners everywhere are struggling to stay out of the rough.
"The golf business is in a perfect storm two of the worst winters in a row, a bad economy, the nature of private ownership, and less and less people belonging to a country club," Doser said.
At Montgomery Village Foundation meetings in May, Doser explained that his business is not profitable, and eventually, he will need to sell the course.
Doser hired Bethesda-based The Artery Group LLC in October, which has expressed interest in developing townhouses or single-family houses on the 148-acre course.
Doser has tried to explain that increased marketing will not work.
He knows how to run a golf business, he said. He has owned part or all of five courses, in Maryland and Florida, and has been a PGA professional golfer since 1965.
"I'm not new to this game," he said.
Nationwide, it's rough
Across the nation, about 15 percent of private and public course operators report that their operations are at risk, said Jim Kass, the director of member research and communications at the National Golf Foundation.
All or part of 13 Maryland golf courses closed between 2006 and 2010, according to the foundation.
Three of the nine public courses operated by the Montgomery County Revenue Authority lost money in fiscal year 2010.
Inexpensive private clubs that appeal to the middle class are hurting the most, said Bill Rehanek, senior vice president of operations at Billy Casper Golf, a golf marketing and management company.
"People look at private clubs as a luxury they can't afford," Rehanek said.
Doser said he set out to be the most affordable private club of the 16 in the county.
Individual unlimited membership at Montgomery Village is $3,360, while the nationwide average is $5,560.
Doser will not reveal details about his expenses, earnings or losses, but says the club is a multi-million dollar operation.
Its collapse started about five years ago, when he saw an opportunity to sell the land.
He negotiated a $50 million contract with developers IDI Group Cos., who planned to build condominiums or houses on the property.
Golfers jumped ship, thinking it was the end of their course.
Then, the developers decided not to buy.
Once at 370 members, Doser now has about 260.
He started losing money about three years ago, he said.
In recent years, the county revenue authority has been offering deals at its nine public courses that Doser can't compete with, he said.
The revenue authority is not trying to steal business from private courses, but rather wants to encourage people families, specifically to play golf, said Keith Miller, the authority's executive director.
"Our goal is to grow the game of golf, and expand our outreach into the community," he said.
The revenue authority began offering family golf programs and reduced family golf rates two years ago.
For $10 a person, a family can play 9 holes in the morning or 18 holes in the afternoon.
Doser recently ran what he considered a successful marketing campaign with Groupon.com. He offered two people the chance to golf for $60. He sold 1,930 deals, allowing about 4,000 non-members onto his course.
But opening his course to the public completely would sabotage his business model, he said.
Some private courses are still viable, Rehanek said they just need to rethink how they operate.
Cutting assessments is one way to entice new members; reorganizing food and beverage and banquet operations to be more profitable could work, too, Rehanek said.
About nine years ago, Doser stopped charging a $7,500 assessment fee.
Many clubs are choosing to become more family-oriented, Rehanek said, with fitness centers and pools.
Doser has considered adding a fitness center, but said he could not compete with affordable local gyms, he would lose banquet space and it would be too much of an investment.
Doser said he is the only private golf club in the county with a liquor license; banquets generate revenue.
He has no option, he said, but to sell the course.
Doser said he thinks most people understand.
"I don't think they expect me to fund a losing golf course so they can have a view."
Golf courses struggling countywide
They just aren't teeing off like they used to.
The number of rounds played at the nine public golf courses operated by the Montgomery County Revenue Authority has decreased by about 25 percent in the last 10 years.
Golfers played about 450,000 rounds a year in the late 1990s, compared to 350,000 rounds in 2010, said Keith Miller, executive director of the Montgomery County Revenue Authority.
Poolesville, Hampshire Greens and Little Bennett golf clubs lost money in 2010, he said.
RedGate Golf Course is owned and operated by the City of Rockville, which is looking into outsourcing management of the course. It posted a deficit of $1.1 million from fiscal 1999 through fiscal 2009.
But, altogether, the county courses are still profitable. In fiscal year 2010, they brought in $650,000, Miller said.
The main question is how many courses the number of golfers in the county can support, Miller said.
"Our three challenges are time, cost and difficulty," Miller said. "The revenue authority is trying to work hard to figure out that equation, by keeping golf as inexpensive as we can and offering the right programs."
Foundation will not buy golf course
The Montgomery Village Foundation will not buy the community's golf course.
The purchase is not a viable possibility, said Dave Humpton, the foundation's executive vice president.
It would require the foundation to go into debt and mandate a massive increase in residents' assessment fees, he said.
Bob Hydorn, president of the foundation board, had mentioned the possible purchase in an April edition of the Montgomery Village News, the community's newsletter.
Hydorn said that was just an idea to keep the green space in the community, and said he respects Humpton's assessment.
The foundation would need about $15 million to make the purchase, according to Jack Doser, owner of the course. The county last appraised the property at $17.5 million in 2009, Doser said.