This week it was announced that the Tiger Woods Dubai golf course project was officially halted. It has been a long-time coming as course construction stopped in 2009 with six holes completed as the high-end real estate market in Dubai fell off a cliff when the economy soured.

Woods launched his design business in 2006 and the Dubai course was his first project. The real estate development was to include 100 villas, 75 mansions, 22 palaces, a 360,000-square-foot hotel, a golf academy and luxury shops. The project was a potential grand slam for Woods as his fee was expected to be $20 million plus a percentage of real estate sales. Now it looks finished.
Woods’ design business has struggled as we chronicled in last year’s magazine story: Tiger’s Other Disaster. Don’t blame the sex scandal that caused sponsors like Accenture, AT&T, Gillette and PepsiCo to drop the golfer. The golf course business has been in a tailspin the past five years as the market for second homes on golf courses collapsed with the recession taking courses down with them (see graphic below). Another 107 courses closed up shop in 2010 while only 46 opened for play.

Woods currently has two other golf course projects under way. The Cliffs at High Carolina is his lone U.S. course. Cliffs’ developer Jim Anthony told the Asheville Citizen-Times this week: “We’ve invested $150 million in this project, so we are fully committed, and Tiger is fully committed to seeing this through to completion.”
Grading on the course has begun, but much work remains and financing is tight. Anthony raised more than $60 million from 525 homeowners at other Cliffs resorts to keep the High Carolinas project going. The mortgage notes pay 12% annually. Real estate sales are slow at High Carolinas with only 42 home sites sold in a development with as many as 1,200 lots. Anthony’s original time line was overly optimistic as we predicted in our July story. The course was originally slated to open in 2011, but it now looks more like 2013 at the earliest.

Woods’ latest project is Punta Brava which is located 65 miles south of San Diego in Mexico. I traded e-mails with the developer Brian Tucker this week and he says that the course is on track to open in the second half of 2012. The course faced delays obtaining environmental permits, but the permits have been secured and course construction is expected to get under way this year.

“When you have a site surrounded on three sides by ocean and a golf architect (Tiger Woods) that completely integrates it by designing 17 tees or greens on/adjacent to the ocean and over half a dozen shots that play over the pacific, you have the opportunity to create something special–a true golf club–not just another real estate development with golf, ” writes Tucker. It is a daring strategy by Tucker who says that individuals will be invited to join the club and then: “After the course is open the club will have a real estate offering, but when it does it will only be to the members.”

While the U.S. golf course design business is sagging, it is booming in Asia. Jack Nicklaus’ design firm says 80% of the deals it secured in 2010 were in Asia. Phil Mickelson has developed only one course in the U.S., but has signed on to develop five in China. Woods is still a hot property in Asia and that likely is where his design business will need to turn for its next projects.