Money for nothing

by Shane McGinley Sunday, 13 February 2011

Timing is everything in golf. On Monday August 25, 2008, a beaming Tiger Woods arrived in Dubai to unveil the masterplan for a spectacular $1.1bn golf resort bearing his name. Appearing before a frenzy of reporters and fans, the world number one cut straight to the chase, proclaiming "Dubai has the biggest, greatest and newest of everything, and hopefully we'll create an experience here with this golf course that people will remember."

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Just 72 hours earlier, Woods and his advisors had signed an extraordinary deal with UAE property developer Tatweer, which promised him a staggering $55,416,667 up front, for marketing a golf course that doesn't exist. In total, Woods was promised $70m, as a "promotional fee" and a further $28,800,000 if he agreed to develop a second project.


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Twenty four days later, in America, Lehman Brothers would collapse, sparking a global financial crisis that would eventually result in Woods' Dubai project being canned. At the time, nobody in Dubai had any inkling of what has come.

Today, as he attempts to win the lucrative Omega Dubai Desert Classic for a record third time, Arabian Business can for the first time reveal full details of Woods' other record - the signing of what may turn out to be the most lucrative deal for doing nothing in the history of sport.

For the past two years, it has been widely reported Woods received $10m and the promise of a lavish 16,500 sq ft villa in return for lending his name and design expertise to, as well as helping to promote, Tiger Woods Dubai. The figure was considered to be far more generous than the going rate of $1m - $5m for such deals, but given that this was Woods in his heyday, few eyebrows were raised.

The first contract for Tiger Woods Dubai was dated June 20, 2006: a Design and License Agreement between Tatweer and ETW (Eldrick Tiger Woods). Original plans for the 55 million sq ft Tiger Woods Dubai included 287 luxury villas and mansions, an eighteen hole golf course, a golf academy and a luxury boutique hotel designed by Lebanese designer Elie Saab. With the property market in the emirate booming, there appeared little doubt that the $1.1bn project would do what every other mega project was then doing - sell like hot cakes.

Woods' original deal with Tatweer is understood to have been for a cash payment upfront, a ten percent equity stake in the project, a 16,500 sq ft villa and royalties on residential sales. But by August 2008, Woods and his advisors had other plans.

On Friday August 22, 2008, Woods signed a new deal with Tatweer. Headed "Amendment to Golf Course Design and License Agreement", it contained fifteen clauses that were added to supersede the original contract. Instead of having the potential to earn millions of dollars, Woods was given a guarantee for $55,416,667, to be paid within ten days of signing the contract.

The amendment, seen by Arabian Business, first refers to the original contract, saying: "Article 3.1 (b) is hereby deleted in its entirety and replaced with the following".

The new deal states: "Owner (Tatweer) shall pay ETW the sum of $70m as a promotional fee." It then breaks down the payments, stating:

"$26,250,000 which has already been paid by the owner and received by ETW"

"$29,166,667, which will be paid to ETW by the Owner within ten days of the full execution by both parties of this Amendment"

"$14,583,333, which will be paid to ETW by the Owner within ten days after Wood's appearance at the Official Opening."

But that was just the start. The next clause in the Amendment made sure Woods was already on board for a second project with Tatweer, agreeing to pay him $28,800,000 if a second project ever happened. It states this money would be paid as a "one time fee".



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