A Golf Course 30
Years in the Making:
by Steve Sailer
UPI, June 12, 2001
This is second in a three part series on the appeal of environmental restrictions to affluent homeowners:
Although President George W. Bush seems to have had a hard time grasping it, the popularity of environmentalism among affluent homeowners stems in part from how conservation restrictions can protect their property values by keeping new home construction scarce.
This is well-illustrated by the three-decade struggle behind the creation of one of the most high-profile housing and golf projects in the United States, Ocean Trails in Rancho Palos Verdes, California [now Trump National Los Angeles].
When I began flying out of Los Angeles International Airport in the late 1970s, I always kept my eye out for a mile-long stretch of farmland adjoining the Pacific Ocean on the beautiful Palos Verdes peninsula, just 20 miles south of the airport. Could somebody squeeze onto this property a golf course?
Non-golfers will have to take this on faith, but to a golfer, few things in the world are more exhilarating than a course on the cliffs above the sea. Despite its many miles of celebrated coastline, Los Angeles County lacked an oceanfront golf course in the grand tradition of Northern California's Pebble Beach, where Tiger Woods won the 2000 U.S. Open by 15 strokes.
The Zuckerman family had been thinking along the same lines ever since the 1950s. Prominent homebuilder Edward Zuckerman (along with a partner) bought a sloping 150-acre garbanzo bean farm rising up from the 145-foot tall ocean cliffs. His son, Ken Zuckerman, told me of the remarkable twists and turns of his family's quest to develop the farmland over lunch at his brand new Pete Dye-designed 15-hole golf course.
Yes, it's a 15-hole course. Ocean Trails is currently short a few holes because on June 2, 1999, just before the scheduled opening, the cliff top 18th hole, a monumental 496 yard par 4, suddenly slid 50 feet out toward Tahiti. Despite the popular myth that the 18th fell into the Pacific, it did not quite plunge that far.
Yet, the landslide did plunge what had been budgeted as merely a $126 million dollar project into protective bankruptcy. Ocean Trails' insurers, though, eventually paid up. At present, a massive construction project is rebuilding the 18th. It will move 1,250,000 cubic yards of dirt. Golf course historian Geoff Shackelford says that at a cost of over $20 million, the 18th will be the most expensive single hole in history.
Zuckerman hopes to have both all 18 in play and the project out of bankruptcy by Christmas. Today, you can play 15 holes of this beautiful course for $99.
In 1970, Ken Zuckerman's father had tried to build on his farmland 1,200 apartment units, a 200-room resort hotel, and a nine-hole golf course. While this would have maximized the number of people able to enjoy stunning views of Catalina Island from their homes, the affluent neighbors, many of whom lived in homes built by Zuckerman, were aghast. Building that many new residences in what had been an exclusive neighborhood would hurt their property values. That's just Econ 101 -- the law of supply and demand.
"In 1970 the no-growth environmental movement was gaining speed," the younger Zuckerman recalled. To block the project, the residents of this then-unincorporated part of Los Angeles County first needed to form a new city so they could change the property's zoning. Under the state law of the time, only property owners would be able to vote on incorporation, and the votes would be weighted in proportion to acres owned. The large property owners, who owned the undeveloped land, voted down incorporation so that they would continue to have a free hand to build on their holdings.
The homeowners, who wished to maintain the scarcity value of their houses, sued, however. Eventually, the courts overturned the election on the grounds that the proportional voting system violated the one man-one vote principle.
The election was held once again with each resident getting an equal vote. Under the new rules, the small property owners got their way. They formed the town of Rancho Palos Verdes. The new government placed a moratorium on development, then downzoned the Zuckerman's property to require that all new homes be built on one-acre lots.
"It didn't make sense then to build, so Dad just sat on the property," said Zuckerman. "We used it for family picnics."
By 1990, however, California had grown tremendously wealthy and ocean view lots were worth a fortune. Greens fees for oceanside courses had risen extravagantly, as well. In 1974, I paid $10 to play Pebble Beach. By the early '90s, it cost almost 20 times that. (Today, one round at Pebble costs $350, plus a caddie fee.)
With a partner (since bought out), Ed Zuckerman's sons Ken and Bob acquired 260 acres, giving them over a mile of shoreline.
The crucial question then became how many of those acres they could actually use for home sites and a golf course.
At that point, the California gnatcatcher, a two-inch long, not very aerodynamic bird that lives in the scrubby gray-green sagebrush along the coast, began to play an enormous role in the Zuckermans' lives and fortunes.
According to Zuckerman, "The gnatcatcher became the weapon to use against the Irvine Corporation to stop development in Orange County." Vast amounts of money hinged on the arcane biological and legal question of whether the California gnatcatcher is different enough from the Baja Gnatcatcher to deserve protection under the Endangered Species Act. While only 4,000 or so California gnatcatchers exist, there are hundreds of thousands of Baja gnatcatchers.
In the 1980s, an ornithologist named Jonathan Atwood announced that he believed they were all the same.
"At the Sierra Club's request, however, Atwood looked at it again and decided they were different," Zuckerman said.
The ornithologist found statistical evidence that gnatcatchers in California tended to differ in "darkness" from those in Baja.
Based on Atwood's new recommendation, in 1993 the U.S. Fish and Wildlife Service declared the California version a protected species. They put stringent limitations on development of 400,000 acres of prime Southern California real estate. In 2000 a new DNA study co-authored by Atwood found "no differences that would place the two birds in different subspecies."
In the early 1990s, however, the Zuckermans correctly foresaw that "the handwriting was on the wall that the California gnatcatcher would be listed as endangered." He recounted, "We were interested spectators. We made the decision that we didn't want to gamble so we went to the government and said, 'Make us a deal on the assumption that the California gnatcatcher is listed.'"
They were told to prove they could grow from seeds the kind of sagebrush that the gnatcatcher likes. Oddly enough, there had been almost no sagebrush left when they had bought the garbanzo bean farm many years ago. Zuckerman noted, "People blame developers for destruction of the environment, but it really started with the Spanish ranchers."
The Zuckermans devoted the next two years to growing a five-acre garden of the rather foreboding sage scrub.
When that proved successful, they brought Atwood out to ask for his approval on the development. "We invited him to walk the property with Pete Dye," who is widely considered the most important golf architect of the last three decades, Zuckerman said.
"Fortunately, they struck it off very well. When they came back they had cut a deal in their minds."
The agreement required the Zuckermans to grow sagebrush from seed in three preserves and in fingers of "habitat" between the fairways. Currently, about 10 pairs of gnatcatchers nest in the carefully tended sagebrush.
"It's nice to know that all that work has at least paid off in terms of birds nesting there," the developer said.
The California Coastal Commission also weighed in with demands for acreage to be devoted to public parks and pathways, which allow the affluent neighbors to enjoy the land without paying greens fees. Jogging trails on golf courses almost never prove feasible because of the danger that a runner will get an eye knocked out by an errant tee shot. Yet, Dye's brilliant jigsaw puzzle of golf holes and pathways appears to have minimized the risks.
Ultimately, out of the Zuckerman's 260 acres, 75 are devoted to the 75 home sites. The golf course is built on 100 acres (compared with 150 for a typical course), but 20 of those were required to be covered with regrown sagebrush. So, 105 acres are reserved for sagebrush, public parks, or pathways.
A general rule of thumb is that environmental restrictions tend to make developments more beautiful and more expensive. Not surprisingly, to recoup this huge investment, Ocean Trails' prices must be high. Home sites start at about $1 million. When all 18 holes are finished, Zuckerman hopes to be able to charge the same $250 weekend greens fee as the Pelican Hill courses in Orange County.
Environmentalism's elitist effects are also seen in the difficulty of the golf course. The sagebrush grown between fairways to benefit the gnatcatcher makes it easy for the amateur player to lose golf balls. On the day of the landslide, the U.S. Golf Association was giving Ocean Trails a course rating. The preliminary "slope" rating, which indicates how hard the course is for a bogey golfer, is 154, just under the maximum limit of 155.
Zuckerman said, "If you knew how difficult this project would be, you never would have started; but once you do, you become a hostage to the project. It becomes your career. I've spent 10 years on it."
Brightening, he went on, "I've lived here since 1971 and raised my family here. I get a special feeling doing something for my community. People appreciate that we've persevered. They come down here and see something special and beautiful and it makes them proud to have it in their community. And that makes me feel good."
In the next part of this series on the financial benefits of environmentalism for wealthy homeowners, I'll describe a struggle that's the mirror image of Ocean Trails' story. In nearby Studio City, homeowners are stridently demanding an environmental impact report to block the building of an old folks home on part of an existing golf course.
[Addendum, January 2005: The Zuckermans eventually went bankrupt and sold their property to Donald Trump, who renamed it Trump National Los Angeles and is determined to make it the most luxurious golf property on the West Coast. It is currently scheduled to reopen later in 2005.]