Trump’s Irish Apprentices Strive For Job Security At Golf Resort
Published on Mar 28 2014 8:54 AM in Hotel
Donald Trump Jr. jokingly appropriated his father’s catchphrase when greeted by applauding employees of the luxury Irish golf resort his father bought last month: “Right, you’re all fired.”
In reality, as many as 280 workers are counting on Donald Trump senior to keep their jobs after he bought the Greg Norman-designed course set along 1.5 miles of beach and dunes in a remote corner of southwest Ireland.
Trump, due for a first visit in May, bought the 400-acre Doonbeg Lodge and Golf Course last month after a U.S. hedge fund placed it into receivership.
“My first reaction was ‘wow,’” said Joe Russell, Doonbeg’s general manager, sitting in Darby’s bar at the resort on the shores of Doughmore Bay in West Clare and recounting the events from when the Trump delegation arrived. “The second reaction was, that’s great now.”
Doonbeg is no stranger to drama, its 12-year history featuring bitter family feuds, 80 million euros ($110 million) of losses and lawsuits played out against the storm-lashed coast. The arrival of Trump, whose tussles over his Scottish golf resort were made into a 2011 documentary, suggests life at Doonbeg won’t be quiet anytime soon.
While the purchase came after Trump combed dozens of properties in Ireland, Doonbeg sits in an area where there is potential for more wind turbines, the focus of Trump’s ire in Scotland. Spokesman George Sorial said Trump is prepared for another fight if necessary, and will spend “whatever it takes” to get the development to the standard he wants.
“It certainly won’t be dull,” said Rita McInerney, a local resident and head of the Chamber of Commerce in Ennis, the closest town to Doonbeg, 170 miles from the Irish capital, Dublin. “The main feeling was relief. It’s not only one of the biggest employers in Doonbeg but also West Clare. It’ll be a learning curve for everybody.”
The area, which has a population of about 700, relies in part on tourists, golfing, surfing and visiting the nearby Burren, the vast limestone-covered area, and the Cliffs of Moher. Though below the national average, the unemployment rate in the broader mid-west region has more than doubled to 10.7 percent over the last seven years.
Disputes among locals and environmentalists have been standard in Trump’s recent Celtic ambitions. His 750 million-pound ($1.2 billion) resort in the northeast of Scotland has involved court battles over sand dunes, renewable energy and standoffs with locals who refused to vacate land.
Fresh from a legal defeat in his bid to thwart wind farms off the Aberdeenshire coast, Trump scrapped plans for a second Scottish course that would have created more jobs.
The Trump Organization then said its investment and energy would instead be focused on Doonbeg. It paid about 15 million euros for the Irish course, according to the Cork-based Irish Examiner newspaper. Sorial declined to comment on the price.
Building the course, which opened in 2002, and adding a lodge four years later just before Ireland’s recession hit, wasn’t cheap in comparison.
The previous owner, Kiawah Development Partners, said it spent about $28 million carving the par 72, 6,885-yard course on the western tip of Europe. In all, the South Carolina-based company estimated the bill was 150 million euros for Doonbeg before the owners fell out and settled in court in 2012.
Led by Charles Pinckney “Buddy” Darby, the investors were building real estate and golf courses on Kiawah, a barrier island on the coast of the state, when they sought to do the same almost 4,000 miles across the Atlantic in Doonbeg.
The most recent accounts available for Doonbeg Investment Holding Company show a cumulated loss of 81.6 million euros at the end of 2012. The accounts for a subsidiary also show some investors in cottages on the site are suing previous owners of the resort for non-payment of rental income.
King Street Capital LP, a New York hedge fund that trades in distressed debt, took over the Kiawah company and sold the Doonbeg assets to Trump. The Irish companies set up by the South Carolina investors are now in liquidation.
Instantly, the Trump effect started to pay off for the resort, which charges over 1,000 euros per night for a suite for eight people and about 170 euros for green fees, according to Ray Kearney, Doonbeg’s sales director.
“Straight away, they had a sales call organized” with an investment bank, said Kearney. “I could have spent three weeks trying to find the right person to speak with, and another three weeks getting them call me back.”
Yet challenges await. First, Trump has to figure out how to reverse a trend after Ireland’s courses, which proliferated by 50 percent over two decades, struggle in the aftermath of the nation’s worst economic slump on record. About half of the resort’s revenue comes from Irish players, and Doonbeg already reduced its green fees from about 195 euros.
“There’s a glut of courses and not enough people to fill them: what do you pay first, your mortgage or your golf membership?” said Kevin Markham, author of “Hooked: An Amateur’s Guide to The Golf Courses of Ireland.”
Second, just as Trump took over in February, the resort was hit by a mix of high tides and storm winds that damaged three of the course’s holes. While the damage will be repaired for high season, Doonbeg remains vulnerable because it isn’t protected by the rocks that wrap around other parts of the coast and courses on the west of Ireland.
Finally, Trump may face another battle over the wind turbines he dismissed in Scotland as flawed eyesores.
Turbines currently stand in the area close to Doonbeg, and planning permission has been granted for another seven. An application for another nine windmills close to the court is on ice, and Sorial vows the Trumps will fight any effort to reactivate that application.
Local authorities deem an area south of the village acceptable for turbines.
“It is a terrible technology that does not work,” said Sorial, the spokesman for Trump. “We’ll monitor any applications and are prepared to fight and object with same vigor as we did in Scotland.”
For now, locals are optimistic. Resort manager Russell is seeking an omen from the storm-battered night last month when the Trump reconnaissance party arrived at Doonbeg.
“We had no electricity,” Russell said, looking out of the bar window towards the fairways. “As they walked in the doors or shortly afterward, it came back. They kept the lights on.”