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A Plan B For Private Golf Clubs

CLINTON, SOUTH CAROLINA | It was not a matter of if, but when Musgrove Mill Golf Club would close its doors and put a lock on the gate, and to walk away would have been one of the great golf tragedies, particularly in this part of the world.

Musgrove Mill is a rare find, a near masterpiece unlike anything you’ve ever seen or experienced. It pitches and rolls, meanders, rises and falls and unlike others who claim this, it really and truly tests every part of your game and each club in your bag. You can leave the 18th green at Musgrove Mill having your hind parts severely kicked for four hours and ask the staff if there’s a time on the tee sheet for later that afternoon.

And it was about to die.

The club is owned by McConnell Golf, founded by John McConnell, who bought Raleigh Country Club – which was on the doorstep of bankruptcy – in 2003. McConnell was founder and CEO of Medic Computer, which sold in 1997 for $923 million, personally netting McConnell a reported $60 million. He then invested in and became CEO of A4 Health Systems, which was sold for $272 million in 2006, according to The News and Observer of Raleigh, N.C.

McConnell now owns eight private clubs in North and South Carolina and the roster is regionally impressive. The idea was to build a portfolio of high-rent properties that were financially challenged, make them operationally lean and mean, and give a full member of one club membership rights to all eight.

And when Musgrove Mill came into McConnell’s sights in 2007, it was going to be one of the jewels in the crown. But just as the ink was drying on the contract, the economic catastrophe of 2008 hit marginally profitable private clubs especially hard and Musgrove Mill took a full blow.

At its peak, Musgrove Mill had about 320 members and did 15,000 rounds annually. Last year, the club was down to 170 members – only about half locally – and rounds were down about a third. The club lost $650,000 in 2010 and about that much in 2011. McConnell had enough and told the staff last October that the club was going to be shuttered.

He still had some hope, however, as he was prepared to spend $200,000 annually to keep the course in condition so that if the economy improved substantially, the club could reopen without having to perform drastic maintenance measures.

Musgrove Mill opened in 1988, an Arnold Palmer design that wasn’t even close to anything that Palmer had ever done. According to Golf Club Atlas, Tom Fazio did some of the routing and Ken Tomlinson – of Tidewater Golf Club near Myrtle Beach – contributed some changes. But Palmer gets the design credit.

It is easily the best thing Palmer has ever done and it’s also easily the second-most difficult course in South Carolina – the Ocean Course at Kiawah Island, site of this year’s PGA Championship, coming in first in that race. Two or three of the green complexes might be slightly over the top, but it has consistently ranked among the Top 100 Modern Courses in the U.S. by Golfweek.

When McConnell announced the closure, the response was overwhelming. “It was unbelievable the number of members or people who had been members in the past who contacted us,” said head golf professional Jeff Tallman. “It wasn’t like a facility closing, it was like someone’s funeral. There’s a spirit in this place that is pretty special.”

McConnell, his staff and the club members dodged a couple of deadlines and were finally given until Dec. 31 of last year to generate a plan to save the club. After some late nights, a new membership classification was developed. The staff is marketing 100 memberships to people already belonging to a private club in the Carolinas for $1,200 a year. And it is also trying to sell 150 memberships to private club members outside the Carolinas for $600 a year.

If those memberships become fully subscribed, it will only generate $210,000 a year. The rest of the shortfall is anticipated to be made up by cart fees, guest fees and other forms of revenue. New members are asked to bring three guests per quarter. As of Feb. 1, the club had sold 73 of the new memberships.

The problem Musgrove Mill faces is similar to many private clubs across the nation. The days of the initiation fee are all but gone to all but the most exclusive clubs. Most of the mid-level clubs are practically giving away memberships just to get people in the doors to pay the monthly dues, which are the lifeblood of the private club. And many private clubs are starting to allow limited public play, simply in an effort to generate revenue.

Still, the biggest thing we sell in golf is hope, and everyone associated with Musgrove Mill has high hopes.

“Mr. McConnell is a hero down here,” Tallman said. “Those people who stuck with Musgrove Mill, they are heroes, too. They understand that we’d rather be open and people use the facility as opposed to closing the doors.”

And, at the end of the reality-stricken day, the bottom line is, unfortunately, the bottom line.


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