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  • Writer's pictureRichard Mandell

China Golf Development: Boom or Bubble?

China, China, China. The biggest word in golf development over the past few years has been China. With no new development here in the United States, everyone from golf architects to superintendents to contractors and management groups are headed to the other side of the world to gain work. Since July of 2009, I have made eleven separate trips not just in search of new work but for the one project I have under contract, and luckily, under construction as well.

There are currently six-hundred golf courses open in China. The word is that there are another one-hundred under construction and as many as one-thousand in planning. Personally I have about nine leads that equal about fifteen eighteen-hole equivalents. Whether any of them come to fruition is a question that remains to be answered. All of this activity seems awfully strange when one realizes that the Chinese government banned new golf course construction back in 2004 on mainland China. The island of Hainan is the only province where the powers that be have embraced golf construction for tourism purposes only.

In addition, I was informed during my last trip a few weeks ago that the government has shutdown all new construction until a full review of all projects is completed. The shutdown started in early May in Yunnan Province and was quickly been extended to the rest of the country (other than Hainan). The review comes about from the fact that many courses are being illegally built by utilizing farmland, which is the crux of the government’s stance on golf development. It seems smart governance to preserve farmland considering the billions of mouths to feed in China.

This is not the first time a country-wide shutdown was demanded from Beijing. In fact it has only been three years since the last review. Projects that are clearly invading farmland are the first to come under scrutiny and odds are projects that are not utilizing farmland and have been officially sanctioned (there are some despite the government’s stance) will not be reviewed. No one is too worried this will end golf development in China, though, and most expect construction to resume.

With such a seemingly belligerent attitude toward the golf business by the government, one would think that China golf may be more of a speculative bubble rather than the promised land for our industry which has been effectively exiled from our own lands. The bubble is a very good possibility because the very great majority of the new projects are in process purely to sell real estate at very high levels. In fact, the golf industry may end up being collateral damage to a burst of the overall real estate market in China. Millions and millions of new homes, mostly in the form of high-rise condominiums, are flooding a market where just recently a middle-class (much less a leisure-class) has evolved.

As long as the Chinese begin to build facilities that are accessible and can open up the game to beginners, the industry can thrive. Most people point to the Olympics as a motivating factor for China golf to develop and I agree. Considering they don’t have the glut of professional sports to attract athletes, many Chinese look to the Olympics as the holy grail. Now that golf is part of the equation, it is a good bet that development of the game by the central government on the scale of what South Korea has accomplished will be a motivating factor.

So where does the current shutdown leave my project? My project in the Hunan Province city of Zhangjiajie was not affected because there is no farmland being used for golf purposes. Frankly, it is hard to grow significant crops on 2:1 slopes, even in China. Fourteen holes are grassed and the projected opening of the first eighteen is October 15th. But that doesn’t mean it didn’t have its own government scrutiny. It seems the Mayor of our humble village was unhappy that one of our holes did not have any sand bunkers surrounding the green.

After months of trying to get me to add sand, an ultimatum was handed down, mostly to my amusement. Nonetheless, I relented for the good of the project and added a bunker. Thankfully, there are two other greens complexes that are bunker free, an important aspect of variety for Richard Mandell Golf Architecture. The Mayor seems to be ok with things now that he has his precious sand bunker. I, in turn, plan to sit in on the next City Council meeting to discuss improving traffic patterns. I have a few traffic lights and sidewalks I would like to add.

Regardless of government bans and temporary shutdowns, the Chinese certainly like to do things big on the surface. It is amazing to me how many multiple-course facilities are under construction and in planning there. My project, called Skydoor Golf Club, is twenty-seven holes, but the long-term plans are to go to thirty-six holes with possibly a fifth nine.

The more is better attitude has a logical evolution, though. The first project to really kick off the China golf development boom was Dr. David Chu’s Mission Hills project in Shenzhen which consists of twelve golf courses on two sites. Consider that Mission Hills is fifty percent bigger than Pinehurst Resort and one can immediately see how Dr. Chu’s vision dwarfed every other golf resort in the world. Chinese developers let the good doctor wade out into the depths of uncertainty and as soon as they saw what was possible, the race was on.

Yet as ambitious as those following Chu’s lead were, they thought twelve golf courses were a bit too ambitious for them. But four, five, or even six courses seemed quite manageable. I personally am looking at two fifty-four hole projects and one seventy-two hole project, which seem small potatoes when it comes to Mission Hills.

Only time will tell if Chinese golf development matches the population. If it does, then we will all be very busy for the next decade, churning out four or five-hundred courses a year. But if the government puts the clamps down to slow development across the spectrum, then the bubble may burst.

About Richard: Richard Mandell runs Richard Mandell Golf Architecture in Pinehurst, North Carolina ( Educated as a Landscape Architect at the University of Georgia (he is licensed in both North and South Carolina), Richard has close to two decades’ experience in designing new golf courses and renovating existing ones. Richard may also be the only golf architect in the world who is a certified arborist. He co-hosts a weekly golf radio talk show in Pinehurst and continues to teach a class on Golf Architecture at North Carolina State University which he started in 1997. Mr. Mandell also wrote the award-winning book, Pinehurst ~ Home of American Golf - The Evolution of a Legend (International Network of Golf Book of the Year – 2007).

Richard Mandell has been a Golf Content Creator for the Washington Times Communities since October 20, 2008

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