The interesting thing about this topic is that with market conditions changing constantly, there’s always something to write about. The challenge is keeping track of the market and how buyers and sellers are interacting.
Compared with 10 years ago, the supply of golf facilities in the US has declined approximately 8% while rounds played have increased from 2015 to 2025 almost 15%, according to National Golf Foundation statistics. This explains why it’s tougher to get a tee time, and green fees, dues and club entrance fees are escalating. Most importantly it shows why investors, including from other real estate submarkets have been drawn to golf, especially given the higher rates of return achievable with perceived lower risk than the pre-COVID days. According to RealtyRates.com, the average golf property acquisition cap rate for Q1 2026 ranged from 10.32% to 12.11%, depending on calculating method. Conversely, apartment cap rates ranged from 8.2% to 8.6%, retail cap rates from 8.6% to 10.06% and warehousing from 7.3% to 8.4%. In many cases it isn’t hard to find some of these properties trading at even lower rates. It’s not uncommon to hear about cap rates for more traditional investment properties in the 5% to 7% range.
Compared to other types of investment property, even in today’s favorable market for golf, the inherent fundamentals of golf courses command higher returns. First of all, golf is not just a real estate investment. It’s actually several operating businesses that are management intensive and require lots of real estate. A golf course is an operating farm (agronomy), a recreational facility, a hospitality enterprise (F & B) and a retail operation (pro shop). In some cases it’s even more with some facilities including lodging, non-golf amenities (aquatics, racquets, equestrian, social and more). Golf courses also use land inefficiently. On a property of roughly 150 to 200 acres, even a double shotgun start with 2 groups per hole still yields less than 300 players per day whereas alternative uses, depending on intensity can accommodate more than twice that many users.
The bottom line is that golf has the potential for higher returns without the higher perceived risk from pre COVID days but requires a keen understanding of each specific property and market. These higher rates of return have made golf courses into in-demand investments and in many cases created competition among buyers. We have brokered several properties in the past 4-5 years for sale that had multiple offers and sold for prices in excess of expectations. While we don’t know how long this seller’s market will endure, we do know that different strategies are applicable for marketing specific properties & markets.
Market value, and ultimately pricing (not always the same thing) are also often determined in part by the age and condition of certain major components of the property. For instance, even if operational and functional, an irrigation system that’s 20+ years old could be a blinking red light for an expensive replacement that would be factored into a potential transaction price. The difference between getting market value for a golf property and possibly more than that can be from identifying the right strategy, the right buyers, property condition or a combination thereof.
On the sell side, among the issues I’ve encountered are sellers who seek to market their properties confidentially, or “quietly”. Some are concerned about losing staff, some about losing members or customers and some just seek to do business in a less public manner. While this can certainly limit the pool of prospective buyers, it can be done and we’ve accomplished this successfully on several occasions. I’ve often advised clients that there aren’t any “secrets” but we have sold golf courses without any public knowledge. It’s also beneficial in some cases to market a property without an asking price.
It’s rare that a week or two passes without a prospective buyer reaching out to me looking for golf property acquisition opportunities. Yes, the buyers are still there, several firms I’m aware of are in acquisition mode and who knows where the economy will be in 6 months, a year or 5 years?.
The economics of golf are interesting. On one hand, the supply of golf courses in the United States has declined considerably. Since COVID, participants and rounds have increased but so has the cost of playing (and operating) golf courses. With persistent inflation a common concern one wonders if we can maintain the level of play, and/or whether additional supply will meet or exceed that demand. Will the current surge in golf’s popularity encourage the next generation to become golfers and club members – or will the perceived high cost of entry steer them to alternative activities? IMHO, one factor in favor of the existing courses and clubs is the cost and time required to develop new golf courses. A new golf course is typically a 3+ (or more) year project to undertake and they cost more to develop than they’re typically worth upon completion. Supply cannot be increased quickly. It’s no wonder that those being developed are frequently very upscale projects of wealthy individuals often focused on creating a legacy that they can enjoy with their friends.
Bottom line: If you’re thinking about selling a golf course, now could be an opportune time. If you’re looking to buy, there are still “deals” available but supply is not likely to grow rapidly so there’s potential for insulation against new competition, meaning pricing for acquisitions could be positively impacted by competitive bidding. In some cases the economic stability of a specific property, or its upside potential may warrant paying a premium. Every deal is different. Golf (as my friend Jon Last likes to say) is a very “hyper local” business. There is no such thing as “the golf market.” If you’re a buyer, do your homework about the market dynamics, characteristics of the property and age and condition of the infrastructure. If you’re a seller know your property and market and plan for an efficient exit strategy.
