Andreas Sartori




Andrea Sartori1

He is among the Top 40 in the world’s golf power list at par with many international players. He continues to hop continents in search of the next big trend in golf.

Could you please describe us what exactly is your job? As part of the global KPMG network present in 150 countries, KPMG’s Golf Advisory practice provides professional advisory services to golf business stakeholders, including golf course owners, operators and developers, as well as tourism and golf bodies and governmental organizations. In particular, we have assisted several developers of integrated real estate and leisure resorts in conceptualizing and assessing the viability of their project in which golf played an important role. We have also assisted several owners and operators of existing golf courses in becoming operationally more efficient in an increasingly competitive market place. In addition, we are organizers of the annual Golf Business Forum, which is one of the most important golf businessto- business events globally.

What is the outlook for integrated golf resorts and real estate developments? Clearly, with the combination of continued liquidity problems and lack of confidence and financing for both developers and real estate buyers, the climate for golf development remains unfavorable. The increasing equity requirements of financial institutions, the growing cost of debt (especially because of the increased country risk in markets which were previously considered to be relatively safe, such as Greece, Italy, Spain and Portugal), and the increasing expectations of investors in terms of returns, means the market for golf resorts with real estate will continue to suffer for quite some time. However, there will be a point in time when the international economy recovers and developers will be looking at markets where there is strong domestic demand and tourism appeal to attract international buyers and golf tourists.

What challenges are golf developments with real estate facing? There are three types of buyers for residences on golf estates – owners looking for a primary residence, international second-home owners, and speculative investors. Overall, there are less international second-home owners since the economic downturn and the speculative investor has virtually disappeared. In my opinion, the first markets to bounce back will be those with a potentially strong domestic demand, which are also appealing to the international market from a tourism perspective. For example, some countries in the Mediterranean region including Italy, France and Turkey have favorable characteristics in this regard.

What advice are you giving investors and developers? We are giving the same advice we have always given – you need to be careful in venturing into a golf development because it is a highly complex process. It is not a straightforward real estate development like an office park or a residential complex. Integrated golf, hospitality and housing estate projects require careful planning and the involvement of many different professionals in a critical time line. Understanding the demand and supply characteristics in these changed economic conditions, specifically where your buyers are coming from, the expected sales velocity, and the price point of different products is more important than ever. What type of work are you undertaking and how can you help developers optimize their investment? Bankable documents are required by both financial institutions and potential equity partners. We are also performing an increasing number of valuations for transaction purposes and have more assignments for business reviews to improve the efficiency and effectiveness of golf operations.

What is your personal outlook for the golf travel market for 2012? We have conducted a survey among 120 golf tour operators last year. Over 80% of the survey respondents was expecting growth in golf tourism, with 11% foreseeing a spectacular increase. We are now repeating the survey, the results will be published. What countries are the most popular currently? We recently conducted an opinion poll on the Golf Business Community website among golf industry stakeholders, regarding the expected development hot spots of the next 5-10 years. The poll indicated that the industry thinks the Mediterranean will be the premium golf development hotspot, followed by Central- and South America and China. In which regions are you currently working? We are working on projects in Abu Dhabi, Morocco, Spain and one of the Baltic States at the moment, and I am convinced that there are further opportunities out there. Greece, alongside other European countries, is facing significant economic challenges.

Can it really support integrated golf real estate developments? When looking at a market, it is of fundamental importance to understand demand and supply trends. There is no doubt that Italy possesses all the key ingredients for the successful development of golf resorts and communities, as well as stand-alone facilities. Despite the economic crisis, Greece has a strong tourism product. Greece has everything it needs to succeed, so it is now a question of domestic and international economic recovery and the return of confidence of buyers and developers. I am fairly sure this will happen, but I cannot say when. It appears that we have not yet identified the right recipe for resolving issues related to sovereign debt and economic growth. Therefore, the timing of the recovery on both international and national levels is the hardest factor to predict.

What about politics and bureaucracy in Greece? This is indeed an obstacle and it is true that bureaucracy has made it harder to develop in Greece than some other countries. The length of the administrative procedure required to obtain permits is probably the largest barrier to development in the country. These obstacles have to be eliminated to encourage new golf and real estate projects, especially given the demand and supply potential and the clear socio-economic benefits these developments would bring, including employment creation.


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