Among golf course owners and operators in Wisconsin, there is overwhelming consensus that the coronavirus will negatively impact the industry. The only question is whether the pandemic will create a short-term hit, longer-term misery or a nightmare scenario.
Much depends on the spread of the virus and whether Gov. Tony Evers amends or lifts the safer-at-home order before April 24, leaves the order as is or extends it into May or even longer.
At the very least, the owners/operators say, almost all golf courses will struggle financially to some degree. This is different than, say, a cold March followed by an early April snowstorm that wipes out the early part of the season. In that case, golfers flock to courses when they finally open. In this case, COVID-19 already has damaged the economy, even with the $2 trillion stimulus package President Donald Trump signed into law last week.
Since March 15, more than 177,000 unemployment claims have been filed in Wisconsin, including 108,000 last week alone. The state is home to 450,000 small businesses that employ 1.3 million people; many are closed and virtually all have been impacted to some degree.
When courses do finally reopen, where will golf fit into the average Wisconsinite’s budget? Certainly, diehards will return to the course. But what about the golfer who plays six or eight times a year? What about outings? What about leagues? What about pricier destinations such as Sand Valley, Erin Hills and the Kohler Co. courses?
“Mentally, I’ve kind of prepared myself that this is going to be kind of a lost year,” said Pat Stein, the PGA general manager at Wild Rock in Wisconsin Dells. “I hate to say it. It’s pessimistic. The government thinks that once this is over, people are going to jump right back up and get on their feet and go. But there’s so many people out of work and so many people have taken pay cuts.
“It’s going to take some time to build that confidence back up. I think it’s a different kind of fear than what we faced in 2008, when we had that recession. I think it’s going to be a tough year for golf.”
People will still visit the Dells, one of the state’s top tourist draws. But will they bring their golf clubs and patronize places such as Wild Rock and Trappers Turn, which has suspended construction of lodging and a short course designed by Andy North?
“I think it’s kind of a wait-and-see to see if people cut back on what they’re going to do when they visit the Dells,” Stein said. “I don’t have a feel for it, to be honest with you, what’s going to happen.”
Bill Rogers, the general manager at Evergreen Country Club in Elkhorn, was hopeful last week that Evers would reverse his decision and allow golf, “but with Illinois and Michigan now closing their golf courses, I think the precedent is bad for the short term of reopening. I don’t see any relief on that original order. My fear is it gets extended longer.”
Matt McIntee of Chicago, the CEO of Green Golf Partners, a division of Troon Golf, has told his managers to prepare for the “nuclear option.” Green Golf is Troon’s Midwest division and manages 19 courses, including six in Wisconsin: Washington Park, Shoop Park and Johnson Park in Racine; New Berlin Hills; Northwood Golf Club in Rhinelander, and Princeton Valley Golf Course in Eau Claire.
“We’ve all had to say to ourselves in the event this thing goes beyond expectations currently, what does that really mean?” McIntee said. “In May we start to hit the events schedule. And then June, July, August and September we have all the leagues.
“My fear is that if it goes much deeper than we all hope – because we’re all in the hope phase – you’ll start to see that the ones that survive will be the municipal (courses). But the private owners will be crushed. Some of the private clubs that are carrying too much debt or they were kind of struggling to keep that dues line strong will suffer.
“You could see, without question, the greatest impact in the history of golf. Again, it’s a worst-case scenario.”
Jeff Ellingson, the general manager and head PGA professional at Edelweiss Chalet Country Club in New Glarus, said an extension of the safer-at-home order would be a devastating blow to his course.
“While daily fee is good and it does help us pay the bills, where we really make our money is with our leagues and outings,” said Ellingson, president of the Wisconsin PGA Section. “If this goes into June or July, we can’t possibly reschedule all the outings and it would really be hard for us to run any kind of league for any length of time. So those things would really, really hurt our golf course, for sure, but I think it would hurt every golf course. Because, really, that’s where you make your money.”
Stein said he has had to lay off his golf staff “just to kind of survive this.” Rogers said his superintendent was working with a skeleton crew. McIntee has not yet had to lay off staff, but worries the day is coming that he’ll have no choice.
“I lose sleep over the thought of that,” he said.
With no revenue coming in for possibly several weeks or longer, golf courses are going to have to cut costs. It’s either going to be staff or course maintenance practices – or both.
“Think about how this goes,” McIntee said. “In the Midwest, you pay your cart lease six (months) on, six off. So, people are going to start to struggle to pay their cart lease. If they have mortgages, they’re going to struggle to make their mortgage payments. They’re going to struggle to pay their taxes. They’re probably likely to cut back on their expenses.
“One of the toughest stretches is May 15th till August 1st. We could have heat, we could have humidity, we could have (turf) disease. We have weed pressure. The applications that even the average mom-and-dad puts down costs money and they’re going to start to think, ‘Can I afford to do this?’
“One thing that has been consistently articulated to me across the board at the highest levels is there is a good chance that the normal playing conditions people have come to expect may be diminished for a period of time, simply because people have to pull back in either their grooming practices or their chemical and fert(ilizer) applications.”
The worry and concern certainly are warranted. But Henry DeLozier, a principal and partner at GGA Partners, which provides consulting and support services to more than 3,000 courses worldwide, remains confident that golf will rebound post-pandemic.
“Will there be economic impact for some courses? Certainly, and I’m sorry about that,” DeLozier said. “At the same time, there will be a lot of people that will find every opportunity to get to the golf course because it’s an escape. It’s an opportunity to get out and get a nice walk in some fresh air. It’s frankly a beautiful walk in the state of Wisconsin.
“So, I think golfers will turn out. Will operators of golf courses need to be all the more efficient in their efforts this year? No doubt about it.”
In the years during and immediately after the recession of 2007-’09, golf took a hit as hundreds of courses closed nationwide and many others were forced to discount rates.
“I kind of feel like we were just getting back to where we were before 2008, or getting closer,” Stein said. “Hopefully, we don’t see the huge rate drops that we had to do to survive back in 2008. But everyone’s going to do what they have to do to keep the banks happy and the doors open.”
This time, DeLozier thinks, course owners will come up with creative ways to reward loyal customers without steeply discounting rates.
“The savvy operators will reward golfer loyalty with favorable pricing and benefits, which is more advisable than simply discounting the upfront cost of a round of golf,” he said. “Operators can say, ‘Play 10 rounds with me and the next one is on me,’ or ‘I’ll give you something free.’ Something that results in a lesser discount and yet it recognizes, ‘You’re one of my best customers. Of course, I’m taking care of you. Of course, I’m finding ways to reward you.’
“Candidly, for that person who is going to play once or twice per year this year, why would I need to discount for that? Unless the answer to that question is, ‘Because I’m so desperate that I must.’ In some cases, it’s reasonable to think that will happen.”
Though DeLozier is optimistic, he said, “Only when we can look backward will we be able to measure how much the impact of the coronavirus has had on golfer participation.”
Rogers said he has spent a lot of time thinking about the bigger picture beyond golf. He wonders what businesses will look like in a year or two. Will people still have face-to-face meetings with their insurance agents and financial advisors? Will corner bars and mom-and-pop restaurants close for good?
“Golf will survive in some form,” he said. “We all know that. It always has.”