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FL HOA wants to purchase country club/golf course

Started by HeatherH5 • 18 replies • 1735 views

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HeatherH5 (Florida)
Posts: 6
Posted:
I am a resident in a community of a little over 1100 homes in Florida. There is a semi-private country club/golf course in our gated community. Roads are private.

A couple years ago our BOD began to investigate purchasing country club from outside owner and investing several million dollars into it stating it would likely raise home values and keep developer from coming in to build. A feasibility study was commissioned and completed December 2018. A little over a week ago, BOD announced they have entered into agreement with owner for purchase of country club and will hold vote within 2 months. Very little information has been released about actual cost for residents. We have never seen any of the feasibility study.

There are probably 200 residents that are golf club members. There are maybe another 100 that hold social memberships. The other 800+ do not have any ties to club. BOD president is golf club member. Unknown how many other of the 7 total BOD positions are held by members of golf club.

Do residents have the right to request access to feasibility study contracted to consultant group? It was paid for by HOA. I feel like we are not being given any information that would lead US to believing this purchase is feasible or wise.

Thank you for any insight.
FredS7 (Arizona)
Posts: 927
Posted:
Don't know if you have the right to the study. If done properly it would have financial information about the present operations, which the present owner might not want to see released.

If you are opposed (and, in my opinion, since golf courses have frequently been failing, you should be) you can use the ABSENCE of information to motivate those opposed.

It would be worth knowing immediately what the requirements are for approval. I would expect a very high fraction of the owners since this is a pretty large financial committment. I would think that the chances of stopping this would be very high.

Good luck

HeatherH5 (Florida)
Posts: 6
Posted:
Thank you for your reply, Fred. Personally, I think it is a terrible investment for everyone except those 200 golf club members. There is a lot of growth in this area and so the threat of a developer purchase is real. Our course is a loop configuration so it would be a little less desirable than a core golf course but it is admittedly a possibility. I do feel that the BOD has been using devlopers as the bogeyman to frighten residents into voting for this. We live in a very desirable area with 10 rated public schools. Neighborhoods close by that are not gated and don't have a golf course are selling for right about the same amount per sq ft with the usual few aberrations so the argument that it adds value is not really correct. In fact at this time it probably makes our community less desirable with this being up in the air.

I've researched a lot about Florida statutes, case law, our own by laws, and other similar cases. It may be time to actually consult an attorney but I really feel like they should release the feasibility study that we paid $30,000 for
KellyM3 (North Carolina)
Posts: 2,239
Posted:
Quote:
Posted By HeatherH5 on 05/21/2019 2:42 PM
I am a resident in a community of a little over 1100 homes in Florida. There is a semi-private country club/golf course in our gated community. Roads are private.

A couple years ago our BOD began to investigate purchasing country club from outside owner and investing several million dollars into it stating it would likely raise home values and keep developer from coming in to build. A feasibility study was commissioned and completed December 2018. A little over a week ago, BOD announced they have entered into agreement with owner for purchase of country club and will hold vote within 2 months. Very little information has been released about actual cost for residents. We have never seen any of the feasibility study.

There are probably 200 residents that are golf club members. There are maybe another 100 that hold social memberships. The other 800+ do not have any ties to club. BOD president is golf club member. Unknown how many other of the 7 total BOD positions are held by members of golf club.

Do residents have the right to request access to feasibility study contracted to consultant group? It was paid for by HOA. I feel like we are not being given any information that would lead US to believing this purchase is feasible or wise.

Thank you for any insight.

That golf course wouldn't be the first one to be sold off and turned into zero-lot single family homes that can change the entire vibe and appeal of your current community. While it's fair to want all the details behind a deal since you're partially funding it, I see this as a possible proactive measure to ward off mass development. My relative lived on a golf course that went defunct. She now looks into the back yards of homes built in a row across her property.

Good luck!
GenoS (Florida)
Posts: 4,276
Posted:
Heather, in Florida you have every right to see the results of that study. Submit, in writing (certified mail), a request to see it. An "Official Records Request" is valid for, among many other things, "All other written records of the association not specifically included in the foregoing which are related to the operation of the association." See Florida Statutes chapter 720.303(4)(l).
HeatherH5 (Florida)
Posts: 6
Posted:
Geno,

Thank you. I had suspected that they were obligated to provide it but was not really sure whether it fell into any of the categories of exceptions of documents excluded from statues concerning this. I'm a bit hesitant to do this because I suspect it will be perceived as an all out declaration of war. It just all seems so shady and I have trouble not speaking up when I think someone is doing something not right.
JohnC46 (South Carolina)
Posts: 14,265
Posted:
There are quite a few non golfers that like living on golf courses for the beauty, open space, etc. Ask yourself would you want that destroyed?
FredS7 (Arizona)
Posts: 927
Posted:
Quote:
Posted By JohnC46 on 05/22/2019 7:01 AM
There are quite a few non golfers that like living on golf courses for the beauty, open space, etc. Ask yourself would you want that destroyed?

This needs to be balanced against the fact that a money-losing golf course becomes an expense to the homeowners. I hve read that there are too many golf courses for the number of golfers. Certainly I have seen failed courses in my area. (In fact: why would it be for sale if it was not a money-loser?)

Warning to prospective home buyers: think very hard about buying in a community that owns a golf course.
RoyalP
Posts: 1,104
Posted:
Warning to prospective home buyers: Warning Warning Warning Danger Will Robinson Danger Will Robinson Danger Will Robinson Warning Warning Warning

I/O/W: Caveat Emptor

else you, too, may be Lost in Space

GenoS (Florida)
Posts: 4,276
Posted:
Quote:
Posted By FredS7 on 05/22/2019 11:07 AM
This needs to be balanced against the fact that a money-losing golf course becomes an expense to the homeowners. I hve read that there are too many golf courses for the number of golfers. Certainly I have seen failed courses in my area. (In fact: why would it be for sale if it was not a money-loser?)

Warning to prospective home buyers: think very hard about buying in a community that owns a golf course.

Absolutely right, Fred. It's a huge problem in FL as well where golf ain't what it used to be.

Here's a recent article about a golf course on the west coast of FL north of Tampa:
“Due to the financial considerations and the lack of homeowner associations support, we have not been able to make it work."

Here's another problem near Orlando.

In Southern California, "The fairways are brown, the greens are gone, the buildings are being vandalized."

For an HOA to buy a golf course may or may not make sense. The homeowners, though, deserve a fully transparent accounting that includes every board member's interest in the deal.
HeatherH5 (Florida)
Posts: 6
Posted:
Thank you to everyone who has taken the time to read and reply. I do not know what the future holds and this may well happen. If it turns into a boondoggle, it will be self correcting but it will take years. Residents will try to sell and potential buyers may not be excited about the idea of investing in a golf course. As I said, we have excellent schools and that is a big draw to this community and others around it. I don't know that younger families with school age children will find this appealing and if so, selling will be difficult and home values may decrease. If that happens, I think there will be a large scale effort to oust any BOD members in golf club and stop spending everyone's money to subsidize it.

Should the above happen, at least we would own the property and only be out the few million dollars invested in it along with some neighbors and friends. The community overall is already very divided and I'm very sad to say that I think our sense of a united community will suffer damage for years to come. My family is fortunate to be in a position to "ride it out" so to speak but many others will not be, especially military families that have chosen to make their home here and expected to be able to easily sell their homes without losing their shirts when they receive orders elsewhere. There are also neighbors that may struggle with being able to pay extra costs and that they may have to leave their homes and community because of this is heartbreaking to me.

Developers are a real threat in this area. Many of us are not averse to purchase but feel that the additional millions being spent largely on golf course is not a wise investment. No alternate uses for golf course land were ever entertained. We all know how expensive it is to maintain a course properly. I suggested looking at community amenities that buyers want in 2019 like green space, bike trails, etc. but it was made very clear to me that there has always been only one objective...protect the golf course.

I could be wrong. I really, really hope I am. We are continually being reminded by golfers that we "bought a home in a golf community." We did, and clearly this was a HUGE error on our part. It is a mistake we will not repeat and will make sure to warn others about.
CjC
Posts: 210
Posted:
I currently live on a defunct golf course. The HOA has also be in negotiations to purchase it, but we will be using state available tax credit to reforest it. This way, we dictate where the trees are planted, the cart paths will be kept for walking and we can build soccer fields, dog parks etc.
CjC
Posts: 210
Posted:
Also we do not need member vote to purchase this, but we do need member vote if we want to sell the clubhouse that is part of the course. I would rather us have it broken off before we purchase it and let someone else run the restaurant etc. Otherwise we could turn it into HOA offices, meeting space etc.
HeatherH5 (Florida)
Posts: 6
Posted:
I would be totally on board with this and even excited! I am NOT excited to buy and subsequently "invest" several million dollars into improving a golf course for the enjoyment of less than 25% of residents. Our board is pushing forward with this and we have scheduled a consult with an attorney as the BOD have made it clear the intention is to mandate paid membership for all residents.
JimB37 (Florida)
Posts: 76
Posted:
We are not at this point just yet, but I can certainly envision it taking place. What makes no sense to me is that those same individuals that are "on the side of the golf course" (even employed by the course) are pushing for more rentals - those very people that for the most part don't give a darn about golf.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By HeatherH5 on 05/21/2019 2:42 PM
Do residents have the right to request access to feasibility study contracted to consultant group? It was paid for by HOA. I feel like we are not being given any information that would lead US to believing this purchase is feasible or wise.

There are other documents that you should have access to.

In your shoes, I would want 3 years of the Golf Club's audited financials.
I would take those financials to a CPA and, depending on what that CPA says about the financial health of the golf course, I would consider inviting that CPA to the meeting to speak on your behalf.

While the feasibility study might charm the starry-eyed folks, I believe that the present day reality of what you will own on day one could bring a dose of reality to the forefront of the discussion.

By demanding 3 years of audited financials, you will learn a lot about how much those in control intend to disclose and how much they intend to hide.

Best of luck.
Sikubali jukumu. Read all posts at your own risk.
NpS (Pennsylvania)
Posts: 4,216
Posted:
Quote:
Posted By HeatherH5 on 05/21/2019 2:42 PM
A little over a week ago, BOD announced they have entered into agreement with owner for purchase of country club and will hold vote within 2 months.

I would also want to see the agreement itself. What does it say? Maybe it's just a letter of intent.
What are the contingencies? Maybe ratification by the membership. Are there any outs? Maybe information not yet provided by the golf course. How much money has changed hands so far? Maybe it would be cheaper to cut loose.

Way too many questions to accept someone's statement that "we entered into an agreement."

Sikubali jukumu. Read all posts at your own risk.
HeatherH5 (Florida)
Posts: 6
Posted:
Some interesting additional information regarding home sales in our neighborhood. There are currently 44 homes for sale in our neighborhood (45 if you count a FSBO that isn't showing up in MLS). Neighborhood adjacent and similar but without golf course or gates is about 1/2 the size and has 11 listings. Pending listings drop our number to 30 and adjacent neighborhood to 6. Last year in May, our neighborhood had 23 real estate closings...this year we had 5. Other neighborhood had 4 last year in May and 4 this May.

Last June saw 31 real estate closings in our neighborhood. I think we are up to 4 now for this year but still have almost two weeks of June. Sale price per sq. foot is very similar to within our neighborhood.

The adjacent neighborhood I chose because it is zoned for same schools, also has HOA but no CDDs, and homes were built around the same time. It was originally supposed to be part of this neighborhood but there was apparently some sort of fallout between land owners, I guess.
AugustinD
Posts: 5,144
Posted:
Quote:
Posted By HeatherH5 on 05/21/2019 2:42 PM
A little over a week ago, BOD announced they have entered into agreement with owner for purchase of country club and will hold vote within 2 months.


Is this agreement conditioned upon the required vote of the membership? Per Geno's citation, I would request a copy of it as well , pursuant to 720.303(4)(i). The board has 10 business days to produce the records, pursuant to Florida statute 720.303(5). If the Board does not produce the records within 10 business days, I would send a letter of demand, certified mail, return receipt requested, giving the HOA three days to produce the documents, stating that a failure to produce the records would result in my taking action pursuant to 720.311(2)(a) (pre-suit mediation).

Per the CC&Rs, what percentage of the membership must vote to approve this purchase? What is the typical turnout at elections.

I am in the western United States. Where I am, I know of an 18-hole golf course with condos and homes on its perimeter that changed hands many times. In recent years, the grass went brown. Re-planting and re-seeding is expensive. Now parcels of the golf course are being sold to home developers, no doubt at great profit to the current golf course owners. Zoning issues arose and of course there was great dissent at City Council meetings, against permitting the zoning for residential use. Mostly the developers have won the battles.

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