In the aftermath of the 2008 global financial crisis, the private club business – predominantly bundled with residential real estate development – faced its toughest economic challenges ever as the ensuing recession crippled global capital markets and bankrupted some of the top clubs and real estate developments in the business.
Places like The Cliffs in the Carolina mountains to Sea Island and Reynolds Plantation in golf-rich Georgia were just a few high-profile private club communities that went under financially. At the time, the roiling real estate industry proved to be an existential threat to the traditional private golf and country club model like none other.
Consequently, coupled with changing generational and socio-economic factors, private clubs saw a sharp drop in demand during the following decade with the total number of U.S. private facilities falling from an all-time high of 4,415 in 2007, according to National Golf Foundation data, to an estimated 3,670 in 2020.
To be sure, in the years leading up to the coronavirus outbreak, and certainly in the ongoing post-pandemic golf boom, the private club industry – not to mention real estate in general – is having a renaissance of sorts, what with growing member wait lists, increased membership fees and robust real estate sales from coast to coast.
Nevertheless, just when club owners and operators nationwide are back on strong fiscal footing, there’s another threat poised to upset the sudden stability at private club communities nationwide and this time it has nothing to do with economics. In many respects, it has to do with the changing makeup of memberships and the workforce, or lack thereof, committed to serving them.
As one former top private club general manager-turned executive recruiter describes it, there’s simply just a lot of bad behavior right now emanating from behind the solitude of these private golf gates.
“It’s an interesting club world out there right now and quite frankly, three of the calls I had before I called you were on the same issue or topic that is befuddling clubs these days and that’s the instability or contentious nature amongst the membership these days,” says partner Kurt Kuebler of Kopplin Kuebler & Wallace, one of the leading executive search and consulting firms in the business. “And it’s just rampant right now. I’ve been in the business probably forty-seven years and while I haven’t been doing what I do now the entire time, I’ve had more calls in the last two years than I did in the first forty-five from club GMs and club presidents asking how to deal with instability or how to establish a grievance committee or how to deal with bad behavior. …. It’s just amazing. ... and obviously it’s a sign of our society right now.”
Indeed, the same insurrectionist attitudes and anger polarizing other strata of society, from school boards to non-golf neighborhoods throughout Main Street America, now are upsetting the supposed civil sanctuaries of private clubs. And Kuebler, who previously ran some of the most elite clubs, from Desert Highlands Golf Club in Scottsdale, Ariz., to Isleworth Golf & Country Club in Orlando, Fla., says these distressing club dynamics are dramatically affecting the retention and hiring of future club managers and leaders.
The hardest role to fill in the club space right now, according to Kuebler, is the director of food and beverage because “they’re on the front lines and everybody feels like they’re a food expert.” Case in point is a recent board visit to one of KK&W’s unnamed top clients in Naples, Fla., where, despite an F&B operation that is outperforming many peers by most financial metrics, the seasoned F&B director is tired of the constant mental anguish dealing with her cast of bad club actors and questioning the value of her dream club and perhaps the business as a whole.
“They’re just getting hammered,” Kuebler adds. “So not only are there fewer people getting into (hospitality), those that are in it, the younger managers in particular, don’t have the depth of training or experience to deal with these dynamics and are quickly frustrated.
“So then they’re not matriculating up to even more prominent roles because they’re just getting out of the business. It’s no longer fun. They’re just getting beat down because of the six percent of the members – literally in our view – who are incessantly unhappy with everything in life.”
And for most former and current certified club managers in the business, all the education and training received at various hospitality schools far from equipped them with the necessary soft skills or emotional intelligence needed to navigate the 21st century work environment.
“They don’t train us back in hospitality school how to deal with all of this,” says Kuebler, a graduate of Michigan State University’s esteemed School of Hospitality Business. “They train us how to read a balance sheet; how to read (Profit & Loss) statements; how to create an extraordinary experience for members. … But the focus these days is finding people who can deflect and handle different personalities. People who are more thoughtful and have those types of attributes. It’s all about leadership; not management but leadership.”
In the end, whatever the business might be, it’s this key trait that ultimately defines the sustainability of a company or community as much as any key financial metric these days.