How they are selling New Zealand to rich US golfers

By Tracy Withers

Bloomberg writer Tracy Withers reports on New Zealand owning two of the world's greatest golf courses, soon to be three.
Tara Iti Golf Course is a 75 minute drive or 100km north of Auckland.
Tara Iti Golf Course is a 75 minute drive or 100km north of Auckland.

New Zealand has two of the world's greatest golf courses. Thanks to Californian financier Ric Kayne, it may soon count a third.

Kayne's Tara Iti Golf Club, about 105 kilometres north of Auckland, offers jaw-dropping Pacific Ocean views from every hole. Opened in October, it's the latest in a string of American-designed courses helping to drive golf tourism in New Zealand.

Investors, including Kayne and billionaire Julian Robertson, see New Zealand's dramatic coastline and alpine valleys as potential magnets for overseas golfers. Spending by the sporting vacationers is increasing 10 percent a year, reaching NZ$170 million in the 12 months through September, according to the government. It plans to lure more visitors with this week's New Zealand Golf Open, near Queenstown, that will be televised in at least 60 countries.

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"New Zealand is a first-class golf destination," said Kayne, a co-founder of Los Angeles-based Kayne Anderson Capital Advisors LP. "It has tremendous physical beauty, is safe and accessible. Tara Iti, we are told by visitors, is the jewel in the crown."

Kayne said he fell for a stretch of New Zealand coastline 20 years ago, imagining how the rolling sand dunes could be transformed into a spectacular golf course. He and wife Suzanne have returned multiple times since, taking the 13-hour flight from Los Angeles and enjoying the country aboard their super-yacht.

"New Zealand is far, but easy, especially for West Coasters and Texans," Kayne said in an email. "My wife and I have been back countless times and fall deeper in love with the country each time."

Tom Doak, who worked on five of Golf Digest magazine's 100 greatest courses, was commissioned to design Tara Iti, a former pine plantation near Mangawhai that was cleared and replanted with native dune vegetation outside of the fairways. Now a private members club, it's the first course in New Zealand to feature fescue turf on fairways and greens to provide true links playing conditions, according to Doak's company's website.

Watch: Meet the man who sells high-end golf properties

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New Zealand has almost 400 golf courses, giving it the most per-capita after Scotland. Cape Kidnappers and Kauri Cliffs, both owned by Tiger Management co-founder Robertson, rank in the top 50 on Golf Digest's list.

The government is promoting nationwide golfing tours. One itinerary suggests visitors tee off at Kauri Cliffs, the par 72 championship course on Matauri Bay designed by David Harman, then head south to the Jack Nicklaus-designed Kinloch Club on the shores of Lake Taupo, before ending the 10-day trip in Queenstown on the nation's South Island.

We want to show how simple it is to head down the road and get a different golf experience.

On their golfing journey, players can also sample smaller rural clubs where green fees are paid by leaving a few dollars in an honesty box. "We want to show how simple it is to head down the road and get a different golf experience," said Andrew Fraser, director of marketing at Tourism New Zealand.

Fraser's agency estimated international golf tourism was worth NZ$32 billion in a 2013 report. The 41-page document laid out a strategy for increasing New Zealand's then 0.3 percent market share and leveraging off about NZ$260 million of investment in golf facilities over the previous 15 years.

Tara Iti golf course.
Tara Iti golf course.

Global competition is intensifying, though. For example, Vietnam's government is encouraging investment that could double the number of courses there, Martin Moore, president of Scottsdale, Arizona-based Flagstick Golf Course Construction Management, said last month. His company completed three Nicklaus-designed projects in Vietnam last year.

Golfers are an attractive clientele for New Zealand's NZ$13.5 billion tourism industry, which has overtaken dairy as the country's biggest export earner. They spend an average of NZ$3,300 a visit, compared with the NZ$2,500 average for all visitors, the tourism agency said in a report last year.

Tara Iti, we are told by visitors, is the jewel in the crown.

At Cape Kidnappers, the Doak-designed cliff-top course on the east coast of the North Island, green fees can be as much as NZ$475, excluding cart or caddie. A night in the resort's four-bedroom owner's cottage, with panoramic ocean views, can cost NZ$13,500 before taxes in peak season.

In California, golfers can skip the 13-hour flight and choose from four of the world's best courses within a couple hours' drive from San Francisco, including Pebble Beach Golf Links, host of five U.S. Open Championships. There, a round costs $495 for resort guests.

The Tara Iti golf course between Mangawhai-Pakiri, which has an exclusive membership list of 300, could become one of the world's top 50 courses.
The Tara Iti golf course between Mangawhai-Pakiri, which has an exclusive membership list of 300, could become one of the world's top 50 courses.

"There is an emerging reputation within golf for our luxury offer," said the tourism agency's Fraser. "New Zealand is a highly attractive destination because of our landscapes."

Those will be showcased when Queenstown, the tourist mecca known for its ski-fields and bungee jumping, hosts the New Zealand Open at Millbrook Resort and the Hills Club from March 10 to 13.

"The Open is an integral part of the golf tourism strategy," said John Hart, chairman of the event's organizing committee. "It fits because it showcases some great courses and it showcases Queenstown."

I firmly believe that New Zealand's number one economic strength will be, and should be, tourism.

A relationship with Japan's Golf Tour means 26 of its leading professionals are in this week's field and there will be live coverage on Japan's Golf Network to about 8 million homes.

Viewers will see players at the Hills negotiate tight gullies and wetlands against a mountainous backdrop, while a series of dramatic sculptures -- such as a herd of 2.7 meter (9 feet) tall, cast-iron horses -- nestle in the tussocks or waterways. The course is owned by businessman Michael Hill.

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Japanese companies including Oji Holdings Corp., Sumitomo Forestry Co. and Asahi Group Holdings Inc. are key sponsors. Executives and their guests are able to play in the tournament as amateurs, strengthening business relationships in New Zealand.

Eiichi Ishii, chairman of Tokyo-based Too Corp. and the owner of Millbrook since 1990, is taking over as underwriter of the tournament for the next five years, making Queenstown the probable host in the immediate future, Hart said. The area offers options to expand the event to three international quality courses in close proximity, he said.

"Millbrook and Queenstown make for a wonderful one-stop golfing destination," Ishii said in an email. "I firmly believe that New Zealand's number one economic strength will be, and should be, tourism."

See a Google Map of Tara Iti here:

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