Green Fees 'Soaring High'... "Urgent Need to Ease Golf Course Construction Regulations"

Korea Leisure Industry Research Institute Announces 'New Year Golf Course Industry Outlook'
Green Fees Slightly Decline but Do Not Return to Pre-COVID Levels
Seocheonbeom Director: "Golf Course Construction Regulations Should Be Eased to Increase Capacity"

Putting demonstration. Photo by Yonhap News.

In the new year, green fees are likely to decrease compared to last year, but they are expected to remain at a high level for a considerable period, according to an analysis. Some argue that green fees should be lowered by easing strict golf course construction regulations and accommodating more golf players.

According to the "New Year Golf Course Industry Outlook" released on the 3rd by the Korea Leisure Industry Research Institute, green fees, which soared after COVID-19, are expected to decline due to the cooling of the golf boom and the economic downturn. Following the COVID-19 outbreak, the average increase rate of green fees at public golf courses surged to 33.3% on weekdays and 24.5% on Saturdays from May 2020 to October 2022. Caddy fees rose to 140,000?150,000 KRW per team, and cart fees increased to 90,000?100,000 KRW per team.

This year, green fees, which had been rising sharply, are expected to ease somewhat due to reduced consumption caused by high inflation and high interest rates, as well as the departure of the MZ generation (Millennials + Generation Z) from golf courses. However, the decline is not expected to be significant, and it will likely take a long time to return to pre-COVID-19 levels.

The Korea Leisure Industry Research Institute pointed to the "insufficient capacity of golf courses" as a key reason why green fees are not dropping easily. Although the number of newly opened golf courses has steadily increased, it is still insufficient to accommodate the surged golf population. In fact, the number of golf courses opened this year reached about 20, marking the highest level since 2014. By region, the Busan-Gyeongnam area had the most with 81 holes, followed by the Seoul metropolitan area with 72 holes, Jeonnam and Gyeongbuk regions with 63 holes each, and Gangwon region with 54 holes.

However, this is still inadequate to accommodate the golf population that surged after COVID-19. The golf population increased to 5.64 million last year. Although the weekday green fee at public golf courses (as of May 2021) rose to 173,700 KRW, which is 3.1 times higher than that of Japanese golf courses, many golfers still suffer from "booking chaos."

A key background factor is that the effective capacity of domestic golf courses has decreased due to the government's strong golf course construction regulations. While the "Tourism Promotion Act" does not have specific regulations regarding golf course area, the Ministry of Culture, Sports and Tourism currently manages golf course areas to be within 30% of the tourism complex area through its own regulations. Considering that most golf courses currently being developed are located within tourism complexes, the influence of such government regulations is inevitably strong. As a result, although the number of domestic golf courses is expected to reach 567 by the end of this year, the shortage of golf courses is expected to persist.

Seo Cheon-beom, director of the Korea Leisure Industry Research Institute, analyzed, "Due to the domestic economic downturn and the cooling of the golf boom this year, golf can be enjoyed at a lower cost, but the high-cost structure will continue for a considerable period due to strong golf course construction regulations." He also advised, "The government should boldly ease golf course construction regulations from the perspectives of reducing costs for golfers and efficient use of national land."

This content was produced with the assistance of AI translation services.