Golf is not only a sport, but a booming business producing about Ft 2 trillion (nearly €8 billion) in revenue worldwide. This eye-opening number doesn’t even take into account the periphery effect on related businesses, either. As traditional summer vacation travels are more often replaced by recreational sport activities, golf becomes more available as a tourist attraction for the greater public.
And while in Hungary and in several former Soviet bloc countries, industrialists, bankers and politicians are often known to discuss deals during hunting, according to Capital magazine, two-thirds of transactions larger than €15 million in Europe are agreed upon within the confines of a golf course.
In Balatonudvari, golf course development is underway at Royal Balaton Golf and Yacht Kft, where the public can play for Ft 1500 an hour on the driving range. The project aims to expand the three-month tourist season at Lake Balaton. The amount of the investment is some Ft 1.5 billion, and the investment group consists of five Hungarian entrepreneurs, the municipality of Balatonudvari, and the state-owned Hungarian Development Bank (MFB) Rt. At Bicske, 38 kilometers west of Budapest, is the €300-350 million investment Budapest Gate Country Club, which includes a 100-hectare 18-hole golf course, villas and duplexes, located on plots of 800 and 2,800 square meters, as well as 10 apartment houses, and a five-star condominium hotel with 160 suites and 20 penthouses, spa and wellness facilities and a conference center that can include 1250 visitors on 280-hectare land.
Since the village can host 3000 mostly permanent residents, according to the plans of real estate developer Hungarian Property (Magyar Ingatlan) Kft project manager Bálint Erdős. Magyar Ingatlan is overseeing the project owned by three Irish and one Israeli private investor. Erdős says that the golf village project will give a boost to the local economy in the Bicske area, both through providing work for hundreds of people within Budapest Gate’s hotel and restaurant facilities and by raising demand for local services, shopping and entertainment facilities.
Golf tourists are used to receiving other types of entertainment and services near golf courses as well, a part of the longer-term plan for Bicske. Wellness, wineries, horse riding and other attractions are often expected by the guests, ultimately represented by large villages in Spain or Portugal with a wide range of facilities serving the golf “industry.” Permanent residents of the village will also require quality schools and transportation, which means that the infrastructure of the Bicske area will also improve.
"Golf tourism can attract a significant number of tourists only if the number and quality of golf courses reach the 'critical mass', so that golfers may come and visit several courses within a relatively small distance," Hungarian golf pro László Tringer explained. In Hungary, the central and northwestern areas of the country would appear to be the location of such a critical mass, and a number of golf course building projects are in progress in these regions. Aside from the Budapest Gate project, courses are going up in Zala County near Lake Balaton, and in the Vértes Hills another 18-hole green will open in 2-4 years. In Eastern Hungary, the 18-hole Bolya Eagles Gold & Country Club will open in Vámospércs with a four-star hotel, restaurants and conference facility in 2008.
Upon completion of these projects, the area could attract golf tourism. A number of plans to build golf courses, mostly in Western Hungary, never materialized, said Tringer, but despite some problems such as disputes with environmental authorities, the investments underway seem to be well prepared enough to succeed.
It all adds up to at least Ft 5 billion in investment in Hungarian golf projects. The 60-100 hectares of land and construction work involved in creation of an 18-hole golf course starts at Ft 1.5 billion. And return on investment does not come from the revenues of the course alone. A golf club usually numbers 300-400 members, the average price for club membership is €2,928, the annual fee is €678 on average, and the typical per diem varies between €45.40 and €56.80.
The real business is in the sale of residential properties near the course, though. Due to the exclusivity and limited offer of such golf resort residential areas, real estate developers can attract more buyers than an average residential park. Fifteen percent of houses at Budapest Gate have been sold before breaking ground, the Israeli owner of the project told BBJ.
A new fad
Resort building and purchasing has become the newest fad on the Hungarian residential real estate market, opined Mónika Dömötör, Sasad Resort marketing manager.
The Ft 10 billion 60-acre Sasad Resort offers customers trips to foreign resorts in Austria, Switzerland and Italy to get familiar with the concept of not only buying a flat, but a lifestyle that includes living in green acres with wellness and other sport facilities.
Axus-Golf Kft announced a year ago that it would upgrade an old golf course near Pécs into one of Hungary’s premium golf resorts by investing Ft 3 billion, the Hungarian Golf Association announced.
In addition to rebuilding the 18-hole course at St. Lorence Golf & Country Club in Szentlőrinc, this year the company will build a new clubhouse as well as a four-star hotel with 50 rooms and a wellness center.
Subsequent phases of the project will create 60-80 luxury apartments around the 20-hectare golf property acquired by Axus-Golf in 2005. The company has hired William Barnett, a former professional and coach most recently working for the SAS Birdland Golf & Country Club in Bükfürdő, to manage the new golf course when it is completed.
In March, investors led by the Irish Carr Golf Group began construction of a golf and spa village in Western Hungary for €75 million. The site of the Zala Springs 18-hole golf course and leisure park is located some 20 kilometers from Lake Balaton.
The resort will include 396 luxury villas, a thermal spa, restaurants, a wine club, vineyard, and bars. The Zala Springs project will entail an investment of €75 million, with some €5 million-€6 million of that to be spent on the course, to be designed and constructed by leading golf course designer Robert Trent Jones II.
On 174 hectares near Lake Velence in Csákberény, Swedish investors are building a Ft 10 billion golf course and resort to be completed by 2008 by Roll’ing Kft and Hungarian Golf Development Kft (HGD). HGD is a joint venture between Roll’ing Kft and Sweden’s Tommie Tumba Golf Design AB and will run the project, located around 45 minutes from Budapest by car.