The 13 golf courses operated by Auckland Council mean private interests receive a significant ratepayer subsidy with the alternative use value of the courses topping $2.1 billion, council commissioned reports say.

Reports by Cameron Partners and EY have been released in a review of Auckland Council alternative financing sources.

The comments on golf courses come at a time when Auckland has an estimated housing shortage of about 25,000 based on interest.co.nz estimates, and, according to Reserve Bank Governor Graeme Wheeler, a house price to income ratio of 9.2, which is up from 6 in 2011 and compares to an average of 5 across the rest of New Zealand.

Cameron Partners notes the golf courses have a rateable land value of $61.2 million. However, just four of the courses – Remuera, Chamberlain Park, Pupuke and Takapuna – if made available for housing at the value of surrounding land with 30% reserved for the likes of public spaces, would be worth an estimated $1.4 billion.

“These valuations should encourage Council to review its obligations to providing inner city golf courses, especially those that have limited community access, or at least consider whether its current portfolio is optimised given changes to the city since they were built,” Cameron Partners says.

‘Many thousands of dollars per golf club member per annum’

EY points out that because the course operators don’t pay market rent equivalent to the highest-value use, the opportunity cost of the sites to ratepayers equates to “many thousands of dollars per golf club member per annum.”

The Remuera Gold Course, for example, is 41.2 hectares and has a rating value of $11 million, or $26.7 per square metre. However, EY puts its market value at $250 million to $300 million, or $675 per square metre. Assuming a hypothetical residential housing development, EY says Remuera would see finished sites range from $1,500 to $2,000 per square metre, the Waitemata Golf Course $1,200 to $1,400, and Northcote $1,000 to $1,500.

Rental from the Remuera Golf Course, which is a private club, for the land only is $130,000 a year.

via Auckland public ‘unaware of significance of golf course subsidies’ Auckland Council commissioned report says, noting potential use for housing | interest.co.nz.