The man behind all the Vegas sales

One Las Vegas golf course broker has been feeling lucky as of late.

During the downturn, Sin City had little luck when it came to golf courses trading hands. From late 2007 to late 2010, there were virtually no transactions.

Out of the 49 courses in Vegas, three courses — or six percent of the marketplace — sold in the past year, or since late 2007. The man behind the transactions is Keith Cubba,
senior consultant of the golf and investment group at Colliers International, who represented the seller in all three sales.

“There is really no demand like there is for a Las Vegas course. You can have a course with the same financials as a course in another market and the course here will sell 10 times over,” said Cubba, whose partner is Ken Arimitsu of PM Realty Group.

Las Vegas is an attractive destination when it comes to golf, and visitor volume is on the rise. Out of the 37 million tourists swinging through Las Vegas each year, around two percent will play golf. While the huge majority of passers-by would rather take their shot at the casinos, the 750,000 people that make up the tee time circuit is still a lot.

“Not many resort destinations get that much play with tourists and the local base of golfers,” Cubba said.

One more course in Nevada, which he declined to name, is expected to trade hands this year and he expects two more in the Las Vegas market to sell in 2012. He also has the 18-hole Clear Creek Golf Course in Lake Tahoe on the market, as well as seven listings in other states.

Silverstone Golf Club in Vegas, a course built in 2001 with 27 holes, closed in less than three months after it was listed.

“We had an ideal buyer here in town,” he said.

The course sold for $3.1 million in December 2010 to a local owner-operator, Par 4 Golf Management. It's the first purchase for Par 4, which operates Badlands Golf Club in Las Vegas and Primm Valley Golf Club in Primm, Calif.

Par 4 has an advantage over other owners because of its Par 3 Landscape and Maintenance company.

“They are able to do a lot of capital improvements at a lower basis cost than other operators,” Chubba said.

The company has already dumped “significant capital,” into Silverstone, he said, with such improvements as landscaping, improving the turf and upgrading to the clubhouse.

SouthShore Golf Club, an 18-hole course at the South Shore At Lake Las Vegas facility in Henderson, Nevada, sold for $4.5 million in February 2011 to Nevada SouthShore LLC, a Hawaii-based company with high end private and semi-private golf courses in a number of states. 

Designed by Jack Nicklaus, the SouthShore course opened in 2007. Touchstone Golf LLC continues to manage the facility. The course had multiple offers over a few months.

Silverstone and SouthShore were both lender sales, with the holding company SPE MD Holdings acting as the seller in each case.

He notes that with real estate-owned assets, some are distressed with a physical problem, or the borrower is distressed.

“With Silverstone and SouthShore, I'd say the borrowers are more distressed than the assets. SouthShore is still a terrific golf course without any need for capital improvements,” he said. “In both cases, it was possibly other debt sources that created problems for the borrower — not the property themselves.”

Stallion Mountain Golf Course, an 18-hole gem just 10 miles from the Las Vegas Strip, traded for $3.8 million in June to Tartan Golf & Management of Colorado. OB Sports is now managing the course. The seller was the FDIC, who acted as receiver for the Community Bank of Nevada.

Stallion was built in three phases, in 1991, 1992 and 1995, and designed by Jim Colbert. At one time, the course boasted 36 holes before 18 were sold off for residential. The 18-hole course was shuttered by Community Bank of Nevada in August 2008 after borrower default. The course re-opened to residents in the 2,700-home community and select others on a preview basis in the late summer. It closed for over-seed and officially re-opened to the public Oct. 1.

“The course had been dormant all that time with people having a course in their backyard without any play. They were anxious to get back out there,” he said.

Keith Flatt, co-founder of Par 4, was tapped to keep course maintenance up to standard while its doors were closed.

“The FDIC was very good about allowing Keith and Par 4 to maintain the property at a level that let the new buyer turn it around quickly,” Cubba said.