Buying And Selling Golf Courses In Florida

• Published date: 22 October 2021
• Subject Matter: Corporate/Commercial Law, Real Estate and Construction, Contracts and Commercial Law, Real Estate
• Law Firm: Shutts & Bowen
• Author: Mr Michael A. Sjuggerud

Whether as a result of market conditions, evolving golfer preferences, or the financial realities of operating a golf course, golf courses in Florida regularly change hands. Below are some key issues to account for when preparing to purchase or sell a golf course in Florida.

The Contract

The sale of a golf course typically includes both real property and personal property. The buyer and seller are encouraged to engage legal counsel early in the process due to the potential consequences of exchanging preliminary communications which may constitute a binding contract. Magnum Capital, LLC v. Carter & Associates, LLC, 905 So. 2d 220 (Fla. 1st DCA 2005) (letters between parties raised a colorable claim for a breach of contract action with respect to the sale of real property including golf courses for $43 million). Instead, the agreement to sell a golf course should be memorialized in a purchase and sale agreement ("PSA") signed by the buyer and the seller.

Real Property

1. Title. A title commitment will identify the current ownership of the real property and liens, encumbrances, and other matters affecting title to the real property. Save Calusa Trust v. St. Andrews Holdings Ltd., 193 So. 3d 910 (Fla. 3d DCA 2016) (holding that restrictive covenant limiting the property's use to a golf course, which was recorded in compliance with a government-imposed condition for such land use approval, was not a title interest subject to extinguishment by Florida's Marketable Record Title Act). A title policy issued in the name of the buyer at closing will provide the buyer with insurance from financial loss in the event there is a title defect which is covered by the policy. Title insurance policies in Florida are based on the Florida Department of Insurance's promulgated rates, meaning that title insurance premiums charged by title insurers, attorney title agents, and title companies are uniform throughout Florida.
2. Survey. The average 18-hole golf course exceeds 100 acres, and a resort golf course may approach 200 acres Accordingly, surveyors need sufficient lead time to survey a golf course. An existing golf course survey may expedite the surveyor's preparation of a new survey and reduce the cost to the buyer. The survey will reveal the boundaries of the golf course, identify improvements such as the pro shop and maintenance facilities, locate encumbrances described in the title commitment, and identify encroachments. Failure to obtain a new survey will result in a general survey exception appearing on...