Single-family Detached Housing
Single-Family For-Sale Housing
Golf course community
The Atlantic Beach Country Club rejuvenated what had been a faded 18-hole golf course in the small town of Atlantic Beach, Florida, adjacent to Jacksonville. Adding 178 new single-family houses on 50 acres in the center of the 170-acre property financed entirely new facilities for the country club, reviving the club’s flagging membership. The new country club includes a redesigned 18-hole golf course and an expanded clubhouse with additional amenities. The new houses, ranging from 2,000 to 4,000 square feet, were built by both production and custom builders in a mix of regional architectural styles. The town supplied reclaimed water for irrigation in exchange for an open-space easement over the golf course.
[ Introduction | Site and Context | The Idea | Development Team and Finance | Planning and Design | Approvals | Construction | Performance, Marketing, and Management | Observations and Lessons Learned | Project Information ]
For decades, wrapping quarter-acre lots around a golf course was a surefire recipe for success in the suburbs. Since 2005, though, golf’s fortunes have changed: the number of American golfers has shrunk by 20 percent, with an especially sharp decline among young adults. Spending four hours to play a single game—and years to master the sport—seems less enticing in an era of more fleeting pleasures. Golf’s core devotees are just as enthusiastic as ever, but many country clubs are seeking broader membership bases and revenue streams to deal with rising facility maintenance costs—especially for properties that may now be 40 or 50 years old.
At many golf courses, the response has been to close the doors: 800 courses have closed nationwide since the mid-2000s. Yet redevelopment of those courses has often proved contentious; many neighbors strongly value having open space nearby, even if they are not paying for its upkeep.
Not far from the World Golf Hall of Fame, a redevelopment in Atlantic Beach, Florida, shows a different way forward. The Atlantic Beach Country Club (ABCC) shows how careful infill development can retain open space and habitat, improve the golf experience, infuse new life into country clubs, and improve local water quality, all while delivering new homes within a growing metropolitan area.
The Site and Context
In the 1960s, the Selva Marina Country Club (SMCC) was the toast of Jacksonville. The country club was built just west of Selva Marina, a subdivision of rambling ranch houses on spacious lots a few blocks behind the dunes in the sleepy seaside city of Atlantic Beach. Just beyond the SMCC’s western fence were used-car lots along busy Mayport Road, but on its eastern edge only Sherman Creek and a few blocks of houses stood between it and the ocean. Within the club, members from nearby and across the growing metropolis enjoyed golf, tennis, swimming, and dining.
The Jacksonville area already had a reputation as a golf destination, but the SMCC drew curiosity seekers because it was only the second course built near the beach. Thousands of spectators turned out for an exhibition “dogfight” between Arnold Palmer and Sam Snead in 1962, for the first Greater Jacksonville Open (GJO) in 1965, and for the following GJO—when Jack Nicklaus hit the first double eagle in a televised tournament, taking the par-five 18th hole in just two strokes.
As both the Jacksonville area and the game of golf grew, attention drifted to still-greener pastures farther south. The GJO became The Players Championship and moved five miles south to Ponte Vedra Beach, while metro Jacksonville sprawled far to the southeast toward St. Augustine. The SMCC became just one of 70 golf courses scattered around northeastern Florida.
Although the SMCC may no longer have drawn crowds of spectators, it still had an enviable location for locals. Atlantic Beach sits at the northern end of the Jacksonville beaches, a trio of communities first settled as resorts by Florida’s railroad magnate Henry Flagler at the turn of the 20th century. As cars supplanted trains, tourism shifted to areas along the main highways—and because Naval Station Mayport guards the mouth of the St. Johns River to the north, Florida’s busy coastal highway (Route A1A) detours inland of Atlantic Beach. As a result, the city is a quiet cul-de-sac at the edge of Jacksonville, its three miles of coastline and quaint town center unburdened by through-traffic.
Unlike more commercialized areas to its south that cashed in on tourists and retirees, Atlantic Beach maintained a laid-back beach-town vibe and a family-friendly character. Its status as one of the few incorporated suburbs of Jacksonville (which consolidated with its county in 1968) gave it a degree of self-control unusual in the area. Also unusual was its scale: in a region where everything seems a half-hour drive away, Selva Marina residents “can ride bikes or golf carts down to the beach” or to the town center in just a few minutes, says Leed Silverfield, president of the Silverfield Group, one of the project’s developers.
Atlantic Beach instead evolved into a bedroom community, 15 miles east of downtown Jacksonville and even closer to the new job centers in Jacksonville’s southeast. As industries like banking, insurance, and health care grew to complement the region’s core industries of logistics and defense, Atlantic Beach found new fans as investment bankers and surgeons moved to the area. Yet because the city was largely built out by the 1980s, the local housing stock was not keeping up with changing tastes.
The SMCC golf course, though, was literally dying from within. The irrigation water that the course drew from Sherman Creek, which cuts diagonally across the property, grew more brackish and gradually poisoned the grass. Even fresh water was more curse than blessing: the flat, featureless plain drained so poorly that “a one-inch rain closed the course for the next day,” recalls Erik Larsen, a longtime member of the SMCC and designer of the new golf course. Prospective new members were drawn to the mushrooming competition, and existing members drifted away. “The club was in a slow downward spiral; membership dropped and maintenance was deferred, until the club was on the verge of bankruptcy,” notes Larsen.
Developers had long coveted the SMCC site because it was “one of the very few large open tracts in the beach communities,” Larsen says. Silverfield calls the site “a once-in-a-generation opportunity. Atlantic Beach is a highly desirable area, but it’s entirely built out.” The city of Atlantic Beach also saw tremendous value in maintaining an open-space buffer at its northwestern flank and even once considered purchasing the club for a new park—but the capital investment needed for repairs proved too daunting. By a quirk of geography, most of the golf course sat beyond the city’s boundaries and had been zoned by Jacksonville for multifamily development.
Yet the country club’s tight-knit leadership was reticent about selling the land and disbanding the club. Its member-owners were in charge of its fate and wanted to see the club survive—but they needed money, both up front to reinvent the club in the short term and over the long term to sustain the club’s finances for future generations of members. Doing so would require not just a reborn golf course but additional amenities to broaden the club’s appeal: a larger clubhouse, more dining options, more fitness options, a better swimming pool, and more golf practice and training areas.
Even beyond its sentimental value, the country club still had a compelling market in Atlantic Beach. The area’s continued population growth and strong golf-tourism market ensured that a rejuvenated golf course could hold its own—provided that it was part of a club that could draw on a broader market with a more diversified revenue base.
A partial land sale was another option that could split the difference and provide each of the parties with what they wanted: the club could get all-new facilities without any upfront investment, the city could retain an open-space buffer, and a developer would have country club homesites to sell. To pull such a deal together would require finding a compatible developer who understood the value that a new club would create all around. A deal came together in 2006 to develop the land as the Cove, a tight grid of formal neotraditional houses clustered on small lots at the southeast corner of the site, with a nine-hole golf course on the remainder of the site. That plan even made it through rezoning, but it collapsed amid the economic turmoil that soon followed.
Yet Atlantic Beach’s intrinsic appeal meant that its housing market proved resilient in the aftermath of the 2008 recession. Prices not only rebounded, but per-square-foot prices soon rose back above replacement cost, and teardown activity resumed.
Larsen raised the idea again with Pete Rodrigues, a club leader who shepherded the process through the board. The board put out a request for proposal and began reviewing the responses. Mike Carlin, then president of the SMCC, recalls: “We had been working with several groups, and even had a draft contract prepared. Then we got a call from a member with a referral, determined that they were real, and got good references. Even though we were about to sign the deal in the next couple of days, we decided to meet—and they knocked our collective socks off with their proposal.”
The dark-horse bidder was a trio of local developers who joined as Atlantic Beach Partners LLC (ABP): Silverfield Group, Wood Development Company, and W.R. Howell Company. This group’s key advantage was that it shared the SMCC’s vision of bringing a best-in-class country club facility to Atlantic Beach—not just to pamper the SMCC’s members but also to maximize value. Silverfield says, “Other developers came up with plans that worked best for their pro forma, but we had a plan that worked for what the club wanted.” According to Carlin, ABP’s approach “was very unusual—they had already cut the deal and came back and asked about expanding the clubhouse. They treated it like a partnership; we both wanted this to have a certain character, to realize a vision for what this could become.”
Development Team and Finance
The three firms in ABP had collectively developed over 15,000 residential lots in the market, but few with such a large upfront capital investment. They began moving quickly, moving from contract to closing in one year and to grand opening just ten months later. ABP brought Larsen on board soon after landing the contract, knowing his familiarity with the site.
Financing the construction proved to be a key sticking point. “We had a solid group of local developers with decent equity and an experienced team,” recalls Silverfield, “but lenders were cagey. Especially for groups from out of town, ‘golf course’ was like a four-letter word—a hard sell. It didn’t matter that we were tearing up the old course and putting in a new course, rather than adding to the supply. They were just concerned that golf was overbuilt.” Community banks could see the appeal of an infill site close to the beach in a prime submarket, he continues, “but the dollar amount was too big. . . . National banks weren’t willing to take that big a risk in a down market.”
That left private debt. “We found a local group that we had connections to, a collaboration between two entrepreneurial real estate investors with opportunistic funds,” notes Silverfield. “Having a local lender who knew the demand really helped.” Even then, the underwriting was rigorous: an $18.75 million loan with a 60 percent loan-to-cost ratio, a 50 percent presale requirement, and a “last dollars in” rider so that the funds disbursed only after equity and presale revenue. The lender was paid a base interest rate and a cut of each lot sold.
“It would have been nice to have all custom homes, but we needed at least one merchant builder to take down those lots quickly” and to meet the presale requirement, says Silverfield. That merchant was Toll Brothers, which purchased 90 lots; they were a “natural fit given their luxury profile—but with the purchasing power and credit of a merchant.” Stacia Moore, senior project manager at Toll Brothers, echoes the sentiment: “This neighborhood is exactly Toll’s brand,” given its amenities and pricing. Toll’s recent work was in more distant suburbs, and the firm initially had reservations about whether luxury buyers would opt for Duval County public schools. Steve Merten, division senior vice president for Toll Brothers, says that detailed research on the local buyer pool put those concerns to rest: “When we studied the whole area, we saw higher income levels due to the proximity to Jacksonville—and the beach lifestyle” was unmatched.
Another 30 lots were sold to Riverside Homes, an upstart local firm that “knew this would really launch their growth.” That left 58 lots to sell at retail; some were sold to local builders for spec homes, and others were sold individually through a local brokerage.
“There was enough to do that everyone was actively involved, even without a set division of responsibilities,” says Silverfield. In addition to paying the SMCC for the land, the developers spent $11.5 million to build the golf course and clubhouse.
Planning and Design
Atlantic Beach Country Club’s site plan creates clusters for four distinct uses. The clubhouse, swimming pool, tennis courts, and fitness center greet visitors at the site’s principal entrance from the east. Beyond a bridge over Sherman Creek, the new residences divide the golf course in two. Larsen points out that the practice area and “front nine holes wrap around the development in parallel,” along the southern and western edges of the site, whereas “the back nine is a core layout, uninterrupted by roads or housing” along the creek at the eastern edge of the site. Larsen says that by clustering like uses, “the quality and value of each place goes up.”
Whereas an earlier generation of country club developments sought to maximize the number of golf-frontage lots by double-loading fairways with houses on both sides, Larsen says that technique “banished the golf experience” by giving golfers an alleyscape of rooftops rather than broad views. Even where the ABCC has single-loaded fairways, Larsen continues, the course is designed so that views are “straight down the golf hole,” with trees that soften the edge “and also help to pick up errant golf balls.”
The layout was designed to maximize the golf experience with “varied shots, angles, textures, and color” for golfers, Larsen says—both fun for casual or new golfers and “validat[ion] as challenging by area PGA Tour professionals.” Not everything about the SMCC was discarded: the 18th hole was left intact, as an homage to Nicklaus’s double eagle. Yet most of Selva’s flat expanse was upended to vary the site’s topography, taking a cue from the nearby sand dunes. Luckily, a vein of sand was hidden in the northwest corner of the site and could be mined for this purpose.
The new topography also helps with drainage—a critical issue since half the site was in a floodplain, and the flood storage volume had to be maintained. By “lifting the irrigated fairways, tees, and greens, we can carve out drainage channels between them,” Larsen says, both as wet ponds and “dry drainage basins in the unirrigated rough areas between golf holes.” The basins have standpipes and native plants that keep water from flooding the greens. Silverfield reports that the approach “did its job during the last hurricane.”
The roughs were planted with 10,000 native plants—“sturdy vegetation that offers a great palette for the club’s character,” Larsen says, which also manages its water use, as it “took a bunch of the course out of irrigation.” Wild grasses like muhly grass, cordgrass, and bahiagrass in the rough areas bleed directly into mulched or sandy areas.
Hundreds of existing trees already on the site were identified before grading and were retained or moved to new locations, creating a priceless instant tree canopy along the golf course with sabal palms, live oaks, coast oaks, longleaf pines, and saw palmettos. Landscape architect Kelly Elmore notes that the palms on the site “were acclimated to the soils, don’t blow over, and are tolerant of high water” and were somewhat easily moved with a 90-inch spade. The site plan left other large trees standing, like a grove of maritime oaks that is now a centerpiece of the residential area, and relocated an osprey nest.
The oak grove and two ponds anchor the development’s core, a compact area that accounts for half the house lots. The other half of the lots are along three culs-de-sac that branch north into the course for greater privacy. All but six of the lots back up to either a lake or the golf course.
Elmore took architectural inspiration from Atlantic Beach’s charming older neighborhoods, whose durable and “timeless architectural continuity” evolved over several decades of construction. “We studied the old core and saw that we had to mix the lot sizes up.” Five different lot sizes are interspersed at the ABCC, with lots ranging from 0.1 to 0.4 acres.
Considerable effort went into ensuring architectural quality and variety—including writing a pattern book that delineates four regionally appropriate styles—and making sure that every facade passes muster by an architectural review board. Merten notes that “the element of detail is unique at this small scale. Every little detail is reviewed—and then some.” Builders were restrained from repeating the same elevation or plan too close together to avoid a cookie-cutter appearance.
The lots and streets are somewhat narrower than many of the local crews were used to; the streets have 50-foot rights-of-way and have to accommodate two additional utility pipes (for reclaimed water and natural gas). Planting street trees proved impossible in that context, so instead the architectural guideline requires one shade tree in each frontyard.
“To keep the club viable way out in the future, we built amenities that both the homebuyers and the [current] members will want,” says Carlin, with new attractions and membership categories for nongolfers. The amenities included a zero-entry swimming pool, fitness center, and both formal and informal restaurants. As the project progressed, the scope of the clubhouse crept upward as both the club and developer agreed that expanding the club’s offerings had value: from 5,000 square feet in the initial request for proposal to 12,000 square feet, and finally to 16,000 square feet. One unexpectedly popular area is a grassy, fenced-in “backyard” between the clubhouse’s grille and pool deck, which has become a favorite gathering spot for neighborhood children.
Elmore recalls that “propitious timing” also allowed the clubhouse to expand. “The three-quarter-acre residential lot next to the clubhouse came up for sale. We did a third-party sale, since the owner would never sell to the club.” The additional land on the east side of Sherman Creek allows the larger clubhouse, tennis courts, pool, and parking lot to all fit east of the creek.
The site had been rezoned in 2007 with a cross-jurisdictional planned unit development (PUD) adopted by both Jacksonville and Atlantic Beach. This time around, Atlantic Beach took the lead on rezoning the entire site. The previous PUD permitted 180 houses, and the new Special Planned Area permits 200—178 were built, but another 22 could be built where the driving range sits. An impervious site coverage limit of 65 percent and a 35-foot height limit apply across the site. Elmore says that “there was good cooperation with the city,” in part because the proposed plan was superior in many respects to the existing entitlements.
The golf course’s secondary entrance, leading toward Mayport Road, was built with a gate at the city’s request. That feature keeps cut-through traffic on the highway and out of the adjacent neighborhoods.
The new golf course would have been impossible without a new source of freshwater—an increasingly rare resource in Florida, where groundwater supplies are strained and saltwater intrusion threatens surface waters. According to Silverfield, “It was in the city’s best interest, the club’s, and ours to make the water work.”
Atlantic Beach offered to extend its water supply, in exchange for a permanent recreation and green-space easement over the golf course (the driving range excepted), and cooperation with annexing the entire site to the city. Silverfield says that the easement helped both parties: “So long as the city delivers water, the course can’t be used for anything other than recreation. . . . The green-space easement gave our buyers a lot of peace of mind.”
For Atlantic Beach, the golf course was also a water management opportunity. The city was already obligated to upgrade tertiary treatment at its wastewater treatment plant (WWTP), just 350 feet south of the golf course’s southern boundary—resulting in reclaimed freshwater suitable for irrigation. Water reclamation would keep thousands of pounds of nitrogen and phosphorus pollution out of the St. Johns River.
Yet the opportunity had three wrinkles: (a) the new treatment facility had to be squeezed into the northern margin of the WWTP site, between the existing outfall and the golf course; (b) it had to be completed very quickly (the contract was approved in May 2013, and water had to be delivered in March 2014); and (c) although the average daily volume of water would be 0.4 million gallons per day, the course would need 1 million gallons per day for the grow-in period.
The solution was to reuse existing water tanks as a temporary disinfection facility for the first eight months while new chlorination and pumping facilities were built. An unused water main already ran from the WWTP along the golf course’s western edge and would deliver the reclaimed water to a new 2.5 million-gallon, clay-lined storage pond. The city spent $1.4 million in total, including a $442,000 grant from the regional water management district.
With less than one year from ground breaking to opening, the sheer scope of regrading necessary to overhaul the site required a tremendous effort. “At one point, we had the site contractor working double crews here,” recalls Silverfield. Luckily, he continues, the effort paid off: “We were able to plat the first few lots before we were finished with grading and start the model homes six months before everything else was in. . . . By the time we had roads open, we already had a ton of momentum” on home sales. Elmore also credits weekly staff meetings with quick resolution of issues as they arose.
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Performance, Marketing, and Management
The residential lots sold out ahead of schedule, in about 18 months, at prices above pro forma—with the final lots selling for $370,000. The homebuilders also began building out their final tranche of lots ahead of schedule.
Equally important, the country club is now thriving. From 2013 to 2015, it swung from just barely breaking even to running a first-quarter operating surplus of over $360,000, thanks to a doubling of recurring revenue. Membership has grown from fewer than 200 to nearly 800, and the formerly sleepy clubhouse is now abuzz day and night. Furthermore, 80 percent of the SMCC’s members carried over to the new club—even paying half-rate “construction dues” for an entire year without having home facilities—and an influx of new homeowners has filled the new nongolf membership categories. The club now boasts the youngest average member age among its peers.
The redesigned golf course has garnered national attention: in 2014, it was named one of the Best New Courses by Golf Digest and a Renovation of the Year by Golf Inc. In 2017, the PGA’s Web.com Tour Championship will again bring crowds of spectators and live TV cameras to the SMCC’s famed 18th hole.
Marketing efforts began the moment “our plans were approved and we had zoning,” says Silverfield; with a tailor-made list of potential customers—“we had a member special preview event at the old clubhouse, and club members had the first shot at reserving lots.” Word of mouth has continued to grow, adds Moore. “As the community comes to life, it’s starting to sell itself.” Elmore estimates that about half of the buyers are new to the area, and one-fifth are neighborhood residents who want a newer, lower-maintenance house. One quirk that those who relocated appreciate is that the site, unusually for Florida, has natural gas; thus, homes can have fireplaces, gas cooktops, and instant water heaters.
East-facing lots were among the first to sell, both for the view over the back nine and for the ocean breezes. Lots facing the ponds and woods were also popular, says Elmore. “Many people didn’t want to be directly on the golf course but wanted open views.”
Homeowners are obligated by covenant to be members of both the country club and a homeowners association. Cost-sharing agreements are in place between the club and HOA for shared elements on the property that are not owned by the club, such as the entrances, and the HOA maintains spaces like the mail kiosks.
Observations and Lessons Learned
Larsen is optimistic that the precedent set at the ABCC can be “a solution to revive hundreds, even thousands, of failing golf communities” across the country. Developing only a fraction of the land meant “the country club realized capital from the land sale, receives mandatory dues and use revenue from the new neighbors, and got an entirely rebuilt facility, all in two years—legitimately a win-win situation.”
An earlier generation of golf courses were not designed with land efficiency in mind, so it is not difficult to carve anywhere from 5 to 50 acres from the interior of a course—however much land is needed for a functional development parcel. “By moving a golf hole, I can probably also make it a better, safer, and more functional” golf course, says Larsen. “This model is good for golf,” he continues, since it keeps golf courses in operation “without changing ownership and without changing use . . . and can rejuvenate a club with recurring revenue and social activity.” The best candidates for a partial-infill approach would be those with high land values, strong underlying markets for golf and residential, and a parklike layout with few double-loaded fairways.
At the ABCC, the lack of adequate freshwater was a key factor that led the club to choose redevelopment. Nationwide, increasingly scarce water will require more collaboration between developers, municipalities, and major water users like golf courses. Reclaimed water (also called recycled water) particularly is growing in popularity; according to the U.S. Golf Association, it accounts for over one-fourth of all golf course water use. Recycling is also becoming more common for potable water; San Diego plans for recycled water to account for one-third of its water supply by 2035.
Silverfield credits the partial-infill approach for smoothing the development process. Keeping the club meant that “the interests were aligned between the club and developer” and contributed to “a strong relationship with the city and neighbors—so you’re not swimming against the current, but with it.” He continues, “The faster we sell those houses, the faster those people become members of the club—it’s a symbiotic relationship.” Yet finding the right balance at the ABCC took several tries: “It doesn’t matter how fantastic the golf course is, if it doesn’t work from a real estate standpoint. I want a neighborhood and a golf course that work together well.”
|Selva Marina Country Club built||1958|
|Planning started||November 2012|
|Land contract signed||January 2013|
|City approved water engineering contract||November 2013|
|Land acquisition closed||January 2014|
|Construction started||January 2014|
|Development opened||December 2014|
|Country club grand opening||January 2015|
|Debt: Capital Solutions IV||$18,750,000|
|Development cost information|
|Site acquisition cost||$4,875,000|
|Total development cost at completion||$31,150,000|
|Land use plan||Acres|
|Number of units||178|
|Unit size range||2,313–3,964 sq ft|
|Cottages (80- by 90-foot lots)||12|
|55 feet wide||50|
|60 feet wide||64|
|70 feet wide||34|
|80 feet wide||18|
|Country club amenities|
|18-hole, 6,815-yard, par 71 golf course|
|350-yard practice range|
|16,000-square-foot clubhouse with two dining rooms, tennis and golf pro shops|
|25-yard, 6-lane swimming pool|
|7 clay tennis courts|
|Country club membership categories||Members||Capacity|
|PGA Tour ambassador||7||8|
1600 Selva Marina Drive
Atlantic Beach, FL 32233
Wood Development Company
W.R. Howell Company
Atlantic Beach Partners LLC
Landscape architecture and planning
Golf course design
MacCurrach Golf Construction
RPC General Contractors
Florida Network Realty
Design, engineering, consultants
Cronk Duch Architecture
Maier Development Solutions
Taylor & White
Peacock Consulting Group
Richard Miller & Associates
Greene Hazel Insurance Group
Leed Silverfield, president, Silverfield Group and vice-president, Atlantic Beach Partners
Stacia Moore, senior project manager, Toll Brothers
Steve Merten, division senior vice president, Toll Brothers
Kelly Elmore, Euthentics LLC
Mike Carlin, board member, Atlantic Beach Country Club
Erik Larsen, LarsenGolf Inc.
Patrick L. Phillips
Global Chief Executive Officer
Kathleen B. Carey
President and Chief Executive Officer
Case Studies and Publications
James A. Mulligan
Joanne Platt, Publications Professionals LLC