Niebur bullish about diversifying into golf course ownership business

COLORADO SPRINGS, Colo. - While continuing to build courses for clients, Niebur Golf has leapt headlong into the course ownership game. The company opened a new course outside of Denver this summer, is building a Tripp Davis/Craig Stadler course in Granby, and is in talks to do another with a municipality in California.

Prior to these projects, Niebur Golf opened Hurdzan, Fry-de-- signed Valley View in Fayetteville, Ark., last year and built and eventually sold a course in Oregon and one in Michigan.

Company president Joe Niebur is bullish about expanding into the ownership business, a growing trend among golf course builders.

"Ownership is something that we are going to trend towards," he said. "We are looking for different partners. We can come in and build it at our cost and schedule, and put in sweat or cash equity.

"A lot of developers are trying to do these projects and are either under capitalized or don't understand the market," he continued. "We have done so many projects, and we have learned from everyone else's successes and failures."

FLEXIBILITY IS THE KEY

According to Niebur, flexibility is key when it comes to structuring ownership deals, because every one is different.

At Green Valley Ranch, a Perry Dye-design near the Denver airport, Niebur came to the rescue when the residential developer's deal with the course developer collapsed.

"We were already set to build the course, and then the deal fell apart at the last hour," he said. "The developer [Oakwood Homes] was freaking out because they had promised the course to homeowners. They asked us if we could do it and we negotiated the contract in two weeks."

In exchange for sweat equity, Niebur got the land and water rights free, plus cash incentives.

"Every deal is different," he said. "We talk with homebuilders and they don't want any part of the golf course. We take the risk for them and benefit from their amenity. They chip in the free land or cash to hire a designer and we get the ongoing profits of the club."

TIME IS MONEY

At Green Valley, the company started work at the course May 1 and had it grassed by Oct. 1. The club held its grand opening July 11.

"We have never done a course that quickly," Niebur said. "But we can do it because we can allocate the resources because we are in total control. Time is money in this business."

While building seven courses for clients this year, Niebur benefits from course ownership because it assures work for his crew. "As the market continues to pull back, this guarantees us work," he said. "I control the schedule and that is a valuable way to save money. I can be flexible about when I start the job and how many guys I put on it. It is a great filler."

Getting in on the ownership game is also helping Niebur to diversify his company. "We are getting a piece of the action," he said. "It takes the image of a builder and transforms it. We are more than a construction company now."

According to Niebur, the industry would be healthier if more builders got involved in ownership.

"We know what works and what doesn't and what is healthy for the market," he said. "We have seen the guys go out and spend $20 million in a market that doesn't work.

"We need a stronger market because it hurts everyone when a course goes belly up," he continued. "It gives the financing community cold feet and cheapens the market."

Copyright United Publications, Inc. Oct 2001
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