What’s your golf club’s land worth?
Will we see more golf courses begin to cash in their fairways, as the value of the land under some of Australia’s most renowned layouts soars into the hundreds of millions of dollars?
That’s the question being posed by a commercial real estate agent, who suggests it’s inevitable that more Melbourne clubs will sell off their property as the value for residential development land in prime suburban locales continues to skyrocket.
Savills’ Clinton Baxter says examples like the Eastern Golf Club’s $100 million sale of its longstanding Doncaster course to Mirvac in 2011 could become the norm as golf clubs seek to stay afloat.
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Eastern Golf Club used the cash from the Doncaster sale to build a new Greg Norman-designed 27-hole layout at Yering in the Yarra Valley, about 30 minutes drive from the original course.
Baxter predicts more clubs will sell up as operation costs and land values continue to rise.
“Melbourne’s golf courses are an incredible source of land wealth, making them susceptible to closure and redevelopment,” he says.
“At some point, the value of the land for a single-use sport with limited players must put pressure on the sustainability of the club.”
The former Eastern Golf Club at Doncaster, which has now moved to the Yarra Valley.
Other Melbourne clubs to have sold up in recent years include Kingswood Golf Club at Dingley in the city’s south-east, which sold its land to ISPT for $125 million four years ago, and Croydon Golf Club, which sold to Australand.
And golfers at Kingston Links in Rowville played their final rounds in June, ahead of its expected transformation into around 800 new residences. It is understood a developer paid about $60 million for the Rowville site in 2016.
Baxter says the value of some golf course land is astronomical, highlighting the prestigious Victoria Golf Club in Cheltenham, which he says could be valued at more than $400 million for its 58ha of land, and Riversdale Golf Club in Mt Waverley, which he says could fetch upwards of $300 million on the open market.
The prime bayside layout at Brighton Public Golf Course could be worth more than $250 million despite sitting on only 34ha, he says.
“Many other public courses are currently zoned for public use but would be worth huge amounts if rezoned.”
“We recently sold a 38-acre former orchard in Wantirna South for almost $100million.”
“Almost all of Melbourne’s golf course landholdings are far larger, better located, and vastly more valuable – developers would be chomping at the bit to access such sites and develop them for high-density housing.”
Baxter says other sports clubs could be facing similar pressures, with many bowls clubs also in prime locations for residential development and some facing declining membership bases.
