The San Fernando Valley golf business is looking a lot like Payne Stewart when he won the U.S. Open on June 20 in Pinehurst, N.C.
Stewart got stuck in the rough on the last hole of the championship, clinging perilously to a one-stroke lead, but he recovered to win the Open with a dramatic putt to save par.
The Valley golf business recovery has been more gradual and less dramatic, but it mirrors the same up-and-down nature of the game.
Golf got off to a great start in the early 1990s, before the regional economy soured. But business fell off so sharply during the recession that private courses were discounting memberships.
Besides the recession, according to membership director Dave Karch of Braemar Country Club in Tarzana, the Valley golf business also suffered from the 1994 Northridge earthquake and from tax law changes that prompted corporations to reduce reimbursements for executives' initiation fees and monthly dues.
But like a golfer fighting back after a poor front nine, the business has climbed back steadily from these setbacks, thanks to the economic recovery and a boost from young golf champ Tiger Woods, whose popularity has generated new interest in the sport.
"All of the private clubs in the Valley are really flourishing right now," Karch said.
The price of a top-level membership at Braemar, which peaked at $20,000 in the early 1990s, has climbed back to $15,000, after sinking to about $8,500 during the recession. Members also pay monthly dues of $385.
Karch said the club no longer needs to solicit new members with an aggressive marketing program, as it did just a few years ago. Two years ago the club was losing 19% of its members annually, but that figure has dropped to 8% and is sinking.
Besides boosting membership fees, Karch said, golf's growth has enabled the club to reduce its membership to 1,000 from a peak of 1,300 several years ago. Having fewer members even though paying higher fees keeps members happier, Karch said, because it means speedier play.
"We have purposely reduced our membership. A lot of clubs have done this," Karch said. He said improved economic times have enabled Braemar, which has 36 holes, to spend $4 million on course improvements in recent years.
At El Caballero Country Club in Tarzana, the price of a membership has climbed to more than $60,000 after drifting to about $40,000 during the recession, said Tom Bernsen, general manager. Bernsen said the club limits its membership to 500 and has "a good balance" between people wanting to join and existing members who want to retire and sell their membership or transfer out of the club.
Bernsen explained that during slow times in the private club business, there aren't always potential new members waiting to join, meaning members who want to retire or transfer out have a hard time finding buyers for their memberships.
The improved economy has also enabled El Caballero to make some improvements that weren't possible during the recession, Bernsen said. Although the club offers tennis and other activities, golf "is usually the first thing potential new members ask me about."
Membership prices and the golf business in general throughout the Valley "pretty much have paralleled the real estate market," according to Jim Swieter, general manager at Porter Valley Country Club in Northridge. Club membership prices peaked at about $20,000 in the early 1990s and then slipped to about $10,000 before climbing back to their current level of $15,000, Swieter said.
Porter Valley has been reducing the number of golf members, which now stands at about 630 and will probably be cut to 620, he said.
"If you have too many golf members, it's hard for them all to get tee times," Swieter said.
Golf's good fortune is less clearly illustrated at the Los Angeles city courses in the Valley, where revenue increased substantially from $5.6 million in 1995 to $6.9 million in 1997 but dipped to $6.1 million in 1998. The Valley has four of the city's seven 18-hole golf courses: Encino, Balboa, Hansen Dam and Woodley.
The 1998 dip in rounds played resulted from flooding at the Encino and Balboa courses that restricted play, according to Pete Frey, golf operations coordinator for the city of Los Angeles Recreation and Parks Department.
Frey said golf's rising popularity doesn't boost revenues as much at city courses as at private clubs because the city tries to keep green fees low. Green fees are $18 during the week and $23 on weekends at the city courses, compared with rates typically several times higher at privately owned courses open to the public.
But Frey said the game's growth and the Tiger Woods influence are clearly reflected elsewhere in the city's golf programs.
"Our junior programs are full. That's a definite result of the Tiger Woods phenomenon," Frey said. "We have about 600 kids in our junior programs, and about 300 of them are in the Valley."