State of play

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The 11th tee at Jumeirah Golf Estates’ Earth Course.

The report also highlighted that in Europe alone, the number of both courses and players has doubled since 1985 and has continued to grow in recent years, whereas in the US, the number of courses and players has levelled off since 2000.

However, what was striking about our Golf Course Development Cost Survey, was the finding that it has become significantly more expensive to develop a golf course - costs have increased more than 20% in the past three to five years.

Our report, an updated version of a study first conducted in 2005, showed that the design and construction costs (excluding investments related to land acquisition, clubhouse, maintenance equipment and cart fleet etc) of an 18-hole golf course now ranges between €1.5 and €5.3 million ($2 and $6.9 million) in Europe, depending on location and quality, €5.1 million ($6.6 million) in Southern Africa, and €9.5 million ($12.3 million) in the Middle East, by far the most expensive region to develop a golf course.

While the costs are highest in the Middle East, partly because of the focus on high-end and signature courses - which tend to be two to two and a half times more expensive to construct - golf course revenues and profits in this region are also substantially higher. Interestingly, the celebrity factor beneficially increases premiums on real estate surrounding the course by more than 10%.

Golf hot spots

As part of the survey, golf course architects were asked where they thought the next golf development hot spots would be and to name the five markets likely to experience the most significant growth in golf course development in the next 10 years. China (58%) and Eastern Europe (55%) topped the list by some distance, with the United Arab Emirates (43%), India (42%) and Russia (30%) making up the top five.

As part of our Golf Travel Insight report, more than 80 specialist golf tour operators in 21 countries were surveyed to find out where they thought the most popular destinations would be in the coming years.

Portugal and Spain, already established tourist destinations, remain firm favorites. However, some surprising destinations are catching up fast. Turkey ranked third on the list of future golf hot spots, and was closely followed by Dubai - despite figures that reveal the UAE has the most expensive green fees in the entire EMA region.

A weekend round on a UAE course now costs on average €121 ($156), compared with €78 ($101) in Portugal (the second most expensive) and just €30 ($39) in the cheapest destination, South Africa.

The news for established golf destinations such as Scotland and Ireland was not so good, as operators expect stagnation in inbound golf tourism here.

From our research, it seems well established destinations are not losing market share thanks to their deep golfing traditions and the quality of their of golf, but the increasing competition doesn't leave much room for further growth.

And so to our annual Golf Benchmark Survey, which analyses the business performance of golf courses across the EMA region. In 2008 it focused specifically on the number of rounds played and total revenues generated (based on golf courses' performance in the 2007 operating year).

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