Understanding Private Clubs: The top questions to ask club officials before purchasing a golf membership in 2022
By: Jason Becker, CEO
Golf Life Navigators
Whether you’ve spent much time around private club life or not, there is always room for a refresher. Especially in an age where the demand for private golf is at all-time highs. Thus, creating a much different environment from years past.
Most golfers don’t realize that the average private club is managed to not make a profit, but rather, keep a predictable attrition rate where member dues off-set yearly expenditures. There are many “for-profit” private clubs out there with corporate ownership but when it comes to membership sales and satisfaction programming, they all will have common systems in place.
The objective of today’s discussion is to focus on the questions you should ask a club official before making a decision to join. This is one of the biggest life decisions you will ever make (especially if there is a home involved) so why not gain as much intelligence as you can and walk away in confidence that you’ve done your due diligence!
That said, let’s get to it.
1) Is the club nearing a waitlist or already at capacity for full golf members?
In today’s market, this is a frequent question and common issue for both buyers and club officials. The demand for golf has never seen a time like we’ve had the past two years. It is likely the club you are eyeing is at or nearing a waitlist era. If so, what are the particulars? I.e. anticipate time-frame in waiting, playing ability while waiting, deposits, club amenity usage restrictions, etc. You will want to gather all of the particulars about being a member in waiting so there are no surprises after signing up.
2) What is play ability like during peak season months?
For you die-hard golf enthusiasts who anticipate playing 4-5 days a week, this is a biggie. Another ramification of the pandemic, playing golf has never been more popular with annual rounds up significantly from last year to next. That said, asking to see the tee sheet won’t surprise any club official as they know how important golf is. In addition, understanding the tee-time booking system will be key as well. Chelsea Tee Time System? Call-in? Good ole’ fashion pencil and tee sheet? By understanding the tee time booking system and procedures you should be able to connect the dots about play ability and determine if you will be a satisfied golfer at this club.
3) Does the club have any ongoing assessments, or are any on the horizon?
This is a great question for a multitude of reasons but more importantly you want to get the scoop on any potential capital calls to the membership after you join. Which isn’t always a bad thing. If the club has been planning to invest into their amenities that is great news! You will want to be part of a forward-thinking club who wants to make sure it’s assets are well received by future members – and is keeping their existing members satisfied. If the club has not invested into its assets the past several years – and has no plan to – I would be concerned at the financial health of the club. Perhaps a meeting with the finance chairman would make sense before you join?
4) Can you describe the overall culture and people here at the club?
Webster defines the term “club” as: a group identified by some common characteristic. So, it would make sense to really get a good feel of your future neighbors and four-ballers. Here are a few checkboxes to hit as you gain intel:
- What is the average member age? You might follow-up with the average age of new members the past two years…this will likely be your cohort of sorts.
- What general geographic area do most of your members come from?
- Are their leagues and regular games that I (or my spouse) could fall right into?
- What would be the level of pretentiousness (if any) at the club?
- How many social events are there through-out the season months?
5) What is my EXIT strategy?
Of course, this isn’t something you would like to think about during the search but with any good investment lies gauging your level of risk. Post 2008, many clubs ended up with an enlarged resignation list of members who wanted to leave and escape paying dues. Fourteen years later, you will still find clubs with a resignation list of members waiting to get their number called for exit. Generally, resignation programs have a three to one in-to-out ratio meaning three new members have to join before one member can exit the list. So, if you were number 50, you were really number 150.
Luckily, most clubs these days with both equity and non-equity memberships have a non-refundable option. This means you can leave when you wish, you just don’t receive any sort of refund on your initiation.
With all of that said, every club is different. Especially with how they manage exiting members. It will be important for you – and your spouse – to understand the procedures and frankly embrace them. At the end of the day, a club will not change its membership docs and bylaws because something might not sit well with a prospect.
In conclusion, these are just a few on the higher-level questions we would suggest asking during your tour. A few more tips would include looking around as you drive into the gates for frequent “for sale” signs on homes…why are people leaving? Take a stroll through the golf shop and restaurant…do people seem happy and is the staff warm? Finally, pay close attention to the landscaping…is it well maintained with colorful flowers, maybe a fountain in the pond or well-kept bridge to the first tee? In all, if a club is investing in its ambience you can safely assume it is under good management and will check the boxes for your ideal membership.