Golf courses can be profitable, but it depends on various factors such as location, size, and management. According to Golf Cart Report’s 2022 market report, golf courses typically make anywhere from a few hundred thousand dollars to more than five million dollars annually. Profitable golf courses are generally selling for six to eight times EBITDA, while some golf courses run at a small loss. However, according to Forbes, average net profit margins for privately owned golf courses and country clubs have been negative for several years.
how to make a golf course profitable?
There are several ways to make a golf course profitable. Some suggestions include:
- Connecting with more actively-sourcing event planners
- Appealing to more demographics, such as women and younger players
- Offering lessons or clinics
- Selling real estate around the course
- Ensuring that the course is well-maintained and has good customer service
- Diversifying income streams, such as through pro shop sales and food and beverage offerings
According to a study by the Reason Foundation, 70% of local governments that operate golf courses report operating in the red. Additionally, an investigation by USA TODAY Network-Florida found that Florida’s municipal golf courses have lost nearly $100 million over the past five years. However, some argue that lowering rates could help golf courses make more money.
Is Golf Course Property A Good Investment?
It depends on the location and the condition of the golf course. In general golf course property is not a good investment because it depreciates in value over time.
However there are some exceptions to this rule so it’s important to do your research before making any decisions.
The best way to determine whether or not a golf course property is a good investment is to look at the current market conditions in that area. If there is high demand for golf courses then the property will likely be more valuable.
Conversely if interest in golf courses is waning then the value of the property will likely decline. So it really depends on the specific location and situation.
Do Golf Courses Actually Make Money?
Some golf courses are quite successful while others are not. Generally speaking golf courses make more money from membership and fees than they do from greens fees.
However in recent years there has been a decline in membership rates which has led to a decline in revenue for golf courses.