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Private Equity Back in Golf

August 1, 2011

Two funds have started rolling up distressed golf courses, and others are expected to enter the market soon. Why the recapitalization of golf should be good for the industry.

Private Equity Back in Golf

Several private equity funds are currently considering whether to enter the golf market, and a few have already started acquiring distressed golf courses.

While it is unclear how many funds will enter golf and how much money will be invested, some long-time insiders believe that golf will see a significant recapitalization over the next few years.

“It has taken time, but people are seeing that opportunities are good and they are planning to venture into [the golf market],” said Jerry Hinckley, senior vice president and managing director for Real Estate Assets at Textron Golf Finance Division. “The recapitalization of golf will take place, and it is an optimistic sign.”

Hinckley oversees Textron’s holding company, Great Oaks Golf, which currently has 29 courses — all properties that Textron Financial has taken over in the last three years. Hinckley said 20 of those courses are currently listed for sale and that he has spoken with many potential buyers, some that have capital and are serious.

Peter Nanula is one such buyer. Nanula, who ran Arnold Palmer Golf Management from 1993 to 2000, reentered the golf market in July with the acquisition of Heathrow Country Club in Lake Mary, Fla., for $3.5 million.

Nanula, a Harvard-trained lawyer with a background in private equity, said his new company, Concert Golf Partners, has cash on hand and can close deals within 30 days. He expects to invest $50 million into golf courses over the next year and is hopeful to acquire five to 10 private or public courses.