They got a great deal.
A Chinese investment group that bought the bulk of National Golf Management courses in April acquired them for tens of millions of dollars below their true worth, according to Horry County property records.
County land records state the eight Horry County courses have a combined fair market value of about $35.5 million, but sales records state they sold for $13.4 million.
In Georgetown County, the four National Golf Management courses that sold there were worth $15.5 million, but sold for $5.7 million, records show.
All told, deeds state the 12 courses sold for $31.9 million below the fair market values listed in Horry and Georgetown County land records.
Steve Mays, spokesman for Founders Group International, the corporate entity that represents the Chinese investors who bought the courses, declined to comment about particulars of the sale.
“I can’t help you on the land value question,” Mays said in a text.
Angela Favre with the Coastal Carolina Association of Realtors declined to comment, saying the association is mainly focused on residential sales.
“We don’t have anything on the record to contribute,” she said. “None of our Realtors were involved in the actual transaction.”
Horry County spokeswoman Lisa Bourcier said she couldn’t specifically address variances in sale prices and market values.
“The agreed upon purchase price is an agreement between the seller and the buyer,” Bourcier said.
Bob Mauragus, president of National Golf Management, couldn’t be reached as of press time. Bill Golden, president of Myrtle Beach Golf Holiday, also couldn’t be reached.
Jane Zheng, a Realtor with Keller Williams of Myrtle Beach who brokered the deal, was out of town this week and unavailable by telephone for comment.
In an email, Zheng said she would look deeper into the variances when she returns later this month.
“Will find out why when I come back to MB,” the email stated.
In a prior interview, Zheng said Chinese investors who’ve been buying Grand Strand golf courses recently have primarily paid in cash.
“Most of them are buying residential, but more are becoming interested in land and commercial,” she said.
Dan Gray, owner of River Oaks Golf Plantation, said he was shocked by the sale prices listed in property records.
“If you add that up and divide it by [eight] you come up with less than $1.6 million,” Gray said of the eight Horry County courses that sold to Founders.
He noted World Tour Golf Links, another course that Founders Group recently purchased and is located next door to River Oaks, sold for $10 million.
The sale included the course’s former International nine, which has been closed since last summer.
“There must have been an assumption of debt other than what’s showing in the courthouse records,” Gray said. “There must have been other considerations.”
Many of the National Golf Management courses associated with the Founders deal didn’t sell individually, but instead were bundled together.
For instance, the sale of Long Bay Golf Club, Grande Dunes-Resort Course and Pine Lakes Country Club was recorded in a single deed, which listed a sale price of $5,080,000, according to public records.
Horry County land records state the three courses have a combined fair market value of $16.7 million, a difference of more than $11 million.
Individually, two of the courses—Grande Dunes ($6.4 million) and Pine Lakes ($6.3 million)—are worth more than the $5.08 million combined sales price listed in deeds, records show.
Similar sales trends occurred with the sale of Myrtlewood’s two courses—Palmetto and PineHills.
Palmetto and PineHills are valued at $6.4 million in county land records, but sold for $2.4 million, according to Horry County deeds.
In virtually every case, there were multiple parcels associated with individual courses, including everything from easements and residential parcels to the entire golf course itself.
For example, the sale of Myrtle Beach National’s King’s North, Southcreek and West courses consists of 11 separate parcels.
Together the parcels are worth $12,347,000. They sold for $6,347,000, property records state.
Gray said he’s concerned the recent deals signal a potential devaluation of golf courses elsewhere along the Strand.
“It opens up all kinds of questions. It would affect the tax base,” Gray said. “There are so many ramifications, it mystifies me.”
Similar trends in Georgetown County
Many of the former National Golf Management courses in Georgetown County also sold far below what public records state they’re worth.
Pawleys Plantation’s market value is listed at nearly $3.85 million, but deeds state it sold for $2.1 million, a difference of about $1.75 million.
Willbrook Plantation, River Club and Litchfield Country Club sold for the bundled price of $3.62 million, according to documents filed with the Georgetown County Register of Deeds.
Georgetown land records value those three courses at $11,735,800.
Individually Willbrook is valued at $4.85 million, or more than $1.2 million more than the combined sale price of Willbrook, Litchfield and River Club, Georgetown County records show.
Litchfield Country Club parcels associated with the sale are valued at $3.9 million, and parcels associated with River Club are worth nearly $3 million, records state.
The Tradition Club, which Founders Group bought a week prior to the main National Golf Management deal, involved six parcels and has a fair market value of $3.6 million, according to Georgetown County property records.
The parcels sold for $3 million, deeds state.
Departure from past sales
In the past 12 months, Founders Group has acquired 22 golf courses in Horry and Georgetown counties, nearly 25 percent of the Grand Strand golf market share.
Founders Group International’s parent company Yiqian Funding is primarily owned by Chinese investors Nick Dou and Dan Liu.
In addition to golf courses, Founders Group also acquired National Golf Management’s call center known as “Tee Time Central” and its golf package operations known as “Ambassador Golf,” according to a news release.
The deal also included four golf-related websites previously operated by National Golf Management, as well as “Prime Times,” the company’s local membership program.
Financial terms of the entire deal were not disclosed, but the golf course component is worth at least $18.5 million, according to deeds filed in Horry and Georgetown counties.
Before the National Golf Management deal, golf courses acquired by Founders Group were bought at purchase prices near or above fair market value.
TPC of Myrtle Beach, for example, sold for $6.75 million, or nearly $1 million more than the $5.88 million fair market value listed in Horry County land records.
Indian Wells—valued at almost $2.3 million in county land records—sold for $4.75 million, more than double its worth.
World Tour Golf Links sold for $10 million, which is just shy of its market value of $10.88 million, records show.