Arcis stays aggressive

Just three years after it was established, Arcis Golf has become a force in high-end U.S. golf operations.

Self-described as “the second largest owner and operator of U.S. golf facilities,” Arcis Golf checks in at No. 9 on Golf Inc.’s list of the world’s largest management companies, on par with GreatLife Golf & Fitness and OB Sports. The Dallas, Texas-based company currently has 56 properties in its portfolio (63 18-hole equivalent courses), spread across 14 states from coast to coast. It has a strong presence in Texas (13 properties), Arizona (nine), California (eight) and Illinois (five).

In the fall of 2017, D CEOreported that the company has annual revenues of “roughly $200 million.”

Though Arcis Golf’s properties run the gamut of product types – 27 daily-fee and semi-private venues, 20 private clubs, nine municipal facilities – the company stakes its reputation on what it’s called “our growing collection of one-of-a-kind lifestyle properties,” in particular the private clubs it owns in Chicago, Dallas, Phoenix and other major metropolitan areas. 

Like ClubCorp, Arcis Golf typically makes substantive investments in the clubs it acquires, as it aims to enhance the customer experience with trendy, upscale attractions (gastro-pubs, festive dining areas, patios with fire pits) that appeal to golfers and as well as non-golfers and especially to young, upwardly mobile adults.

“Arcis Golf is reinventing the modern club experience,” Blake Walker, the company’s founder and CEO, has said. “We are making it more relevant to today’s consumer lifestyles.”

So far this year, Arcis Golf has acquired one property, TPC Valencia in suburban Los Angeles. Generally, though, the company has been divesting, as it’s shed more than a dozen properties that have failed to meet financial objectives or operate in undesirable locations. At its high-water mark, the company had 80 properties in its portfolio.

Walker, who declined to be interviewed for this profile, began his career in golf in the early 1990s, and he worked in various capacities with KSL Fairways Golf Corp., ClubCorp and Pegasus Golf Partners, a company he co-founded. He established Arcis in 2015, as the operations arm of Arcis Equity Partners, an entity he’d created in 2013.

The equity group exploded on the golf scene shortly after its debut by making multi-property purchases from BrightStar Golf Group (three properties), CNL Lifestyle Properties (48 properties) and Eagle Golf (29 properties).

The spending spree was financed in part by Fortress Investment Group, one of several deep-pocketed private-equity firms that warmed up to the golf industry as the nation eased its way out of the Great Recession. The alliance with Fortress helped to make Arcis Golf an instant giant in an industry that’s still largely populated by mom-and-pop operators that struggle to make ends meet. Since 2005, the number of U.S. golfers has fallen from 30 million to roughly 23.5 million.

In such a financially weakened environment, Arcis Golf has thrived. Though opportunities to buy in bulk will undoubtedly be fewer and farther between in coming years, Walker understands the advantages available to companies with ties to big money.

“As an investor and a CEO, you really have to tune out the industry chatter and focus on the fundamentals,” he told D CEO.“We absolutely believe there’s growth.”

As the economy perks up, he’ll certainly have a chance to prove he’s right.

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