Golf Course Valuations

The Market Approach, also referred to as the Sales Comparison Approach, considers sales of comparable golf course properties to develop an indication of value.

Comparable properties are evaluated based on factors including condition, utility, income-generating capacity, and transaction pricing. The reliability of this approach depends on the availability of relevant and recent market data.

Cambridge Partners maintains an extensive database of golf course transactions and utilizes data sources containing current listings and sales to support its analysis.

The Income Approach considers the expected returns on an investment, which are capitalized or discounted at an appropriate rate of return to reflect investor risk and required returns.

In valuing a golf course, Cambridge Partners analyzes financial projections, industry and economic trends, competing course data, and discussions with management. Revenue and expense estimates are also compared with those of other golf courses and clubs.

Key operating considerations may include greens fees, cart rentals, concessions, banquets, instructional lessons, range income, and other revenue sources, as well as the number of available operating days during the year.

Once projected revenues and expenses are evaluated for reasonableness, forecasted net cash flows may be analyzed using a discounted cash flow methodology to develop an indication of value.