Golf Inc - April 2008 - (Page 39)

WITH The price is right There are several finance-related reasons for the current uptick in Korean golf course investment in the U.S. The Korean won was valued against the dollar in late February of this year at 948 won to $1 U.S. In 1997, after disastrous devaluations of many Asian currencies, the won was trading at 1,900 to 1, making the won worth twice as much today in the U.S. as it was 10 years ago. In addition, South Korean governmental restrictions on investment of personal capital outside South Korea have been lifted in recent years. One more factor: Korean banks and ethnic Korean banks in the U.S. have demonstrated a willingness to fund U.S. golf course investment by Korean buyers at what are typically significantly lower interest rates than those buyers can get from U.S. lenders, although in some cases those rates require a higher initial equity position than traditional U.S. lenders might. Alex Kang, president and CEO of San Diegobased Advanced Financial Technologies, is a former commercial real estate and mortgage broker who has been involved in golf course transactions for both Japanese investors 20 years ago and Korean investors today. He says Korean investors and their lenders are more attuned to golf ’s realities. “When I worked for Japanese investors in 1989-1991, those guys didn’t really look at financial statements, where they’d be in the future,” Kang said. “They borrowed money from Japanese banks, and when we had the recession in Southern California, they had to walk away. I think Koreans from Korea have a much better understanding of properties in the U.S., such as cash flow and what’s going to be happening in the U.S. and Korean markets. They are very careful to invest.” Woolson said Korean buyers are definitely looking for returns on their money. “With the Japanese, you heard stories of their writing a check without even seeing the property, but Koreans are very diligent,” he said. Other than proximity to a large Korean population, there is no uniform pattern to Korean golf course investments. The 40 Southern California course sales tracked by CB Richard Ellis include both private and daily fee April 2008 www.GolfIncMagazine.com 39 http://www.GolfIncMagazine.com

Table of Contents Feed for the Digital Edition of Golf Inc - April 2008

Golf Inc - April 2008 Contents Editors Column Birney Takes NGCOA Helm Construction Costs on the Rise KemperSports Adds 14 Courses Americas: Fazio Designs St. Kitts Layout Europe/Africa: Seaside Resort Planned in Egypt Asia/Australis: Faldo Opens New Chinese Course High-Tech Tools: New Technologies that can Help Operators There's No Economic Slump at Still-Popular Reynolds Plantation Tim Moraghan Wants to Make Golf Fun Again Why a $1.5 Billion Resort has Made Environmental Protection a Top Priority Most Admired Operators Marketing Experts Make Their Pitch for Golf Courses From Korea, with Cash Last Word

Golf Inc - April 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.