Pressure mounts to assess the future of golf course land: Savills

Pressure mounts to assess the future of golf course land: Savills
Pressure mounts to assess the future of golf course land: Savills

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Private golf courses across Melbourne are experiencing a change in demographics and player participation, with more than half of all Victorian golf clubs in financial stress yet occupying land potentially worth hundreds of millions of dollars, according to one commercial property expert.

The changes affecting the future of golf have the potential to create a rapid shift in golf course land use, as metropolitan land values continue to rise and golf courses occupy huge areas of residentially zoned land, often in established locations.

Savills Australia’s Clinton Baxter envisages numerous golf courses will opt to sell their landholdings for huge windfalls to compensate for dwindling revenues and rising operating costs.

“Melbourne’s golf courses are an incredible source of land wealth, making them susceptible to closure and redevelopment,” he said.  

“Without the proper planning framework in place, the potential loss of local amenity, open space, and opportunity for long-term public benefit is very real.

“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.”

Pressure mounts to assess the future of golf course land: Savills

Mr Baxter referred to the 2017 Planning for Golf in Victoria discussion paper prepared by the Victorian state government, and cited the urgency of the issue in light of population pressures and escalating land values.  

Several clubs have already elected to sell up, including The Eastern Golf Club in Doncaster for $100 million to Mirvac in 2011, which was relocated to Yering in the Yarra Valley. Other clubs to sell have included Kingswood in Dingley, Croydon Golf Club to Australand in Croydon, and Kingston Links in Rowville.

“All of these sales were as a result of pressure from developers and declining memberships,” Mr Baxter said.

Examples of the immense potential value of the land occupied by private golf clubs include Riversdale Golf Club at Mount Waverley, which sits on 130 acres of General Residential-zoned land and could be worth upwards of $300 million; and Victoria Golf Club in Cheltenham, which sits on 143 acres of General Residential-zoned land and could be valued at more than $400 million. 

“Many other public courses are currently zoned for public use but would be worth huge amounts if rezoned,” Mr Baxter said.

An example is Brighton Public Golf Course, which sits on 85 acres and could be worth upwards of $250 million if rezoned for residential development.

“We recently sold a 38-acre former orchard in Wantirna South for almost $100 million,” Mr Baxter said.

“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.

“There are squillions of dollars to be made in developing such land, and golf clubs would reap huge wealth by selling to developers.”

Mr Baxter said this raised the question as to whether the Victorian planning minister and related authorities should pre-empt a transition in the sport of golf, and step in and rezone private golf courses for public use, in order to prevent Melbourne’s suburbs from losing their parks and green areas.

“There is an opportunity for planning authorities to get the right balance of public use and residential-zoned land before a major potential sell-up of golf courses takes place,” he said. 

“It may be appropriate to review the land currently occupied by golf courses and put measures in place that ensure the land is allocated to best serve the needs of a rapidly growing Melbourne, well into the future.

“We want to see Melbourne’s renowned liveability retained, and ensuring major green open space for future generations remains intact is one such way to retain our global standing – it can be a legacy for future generations.”

Mr Baxter said similar pressures were building on other sports clubs with declining memberships, and highlighted lawn bowls clubs in key locations as an example.

Savills is a leading global real estate service provider offering the full spectrum of services from strategic advice to managing assets and projects and transacting deals. Clinton Baxter is State Director of Savills CBD and Metropolitan Sales. To learn more about Savills, visit savills.com.au.

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