Topgolf said it is “temporarily pausing” its planned $50 million public-private partnership at the Ala Wai driving range with the city due to the impact of COVID-19.
The Dallas-based company did not disclose a projected date for a resumption of the development on the 7.26-acre site.
“While we are uncertain of the timing, once we resume work on the project we will finalize our refinements to our original plan and also incorporate any new insights we have from our updated health and safety standards on the mainland,” Topgolf said on its website.
“Topgolf has a conditional award with the city, and we are currently working with them on next steps,” said Tracy Kubota, acting director of the Department of Enterprise Services, through a spokesman.
The Ala Wai was once celebrated for its Guinness Book of World Records recognition as the busiest golf course on the planet with 220,000 rounds played annually, and its popularity helped pay for the operation of the city’s five other courses.
“Topgolf is not yet ready to resume its project on Oahu, however (it) looks forward to continuing to work with the City and the community when it is,” said Emily Porter, Chief Operating Officer of the MacNaughton Group, one of the project partners.
“We still have a long way to go to bring Topgolf Hawaii to fruition, including finalizing design that incorporates any new best practices developed during this coronavirus pandemic, and embarking on the environmental review process. Accordingly, an opening would still be years out,” Porter said.
But, like many municipal courses across the country, the Ala Wai has suffered a significant decline in use, and the city has said it had to come up with $4.7 million in subsidies from the general funds to pay for the operation of the courses. In 2019 just 129,183 rounds were played at the Ala Wai.
The trend prompted the city to seek proposals from potential development partners, and in 2019 Topgolf, which offers technology-based golf entertainment where customers hit microchipped balls at targets, was chosen from a field of respondents and granted a conditional 20-year lease with an option for 20 more years.
In a February interview, Topgolf officials estimated that once flood plain issues and environmental studies were launched, it would take “1.5 to 2 years” through lease approval entitlement and other issues before construction could begin. Construction was expected to require about a year.
Under terms of the agreement, the city is to receive $1.06 million annually in rent on a schedule that increases 3.16% annually, plus 1% of gross sales.
Topgolf would be responsible for the $50 million in construction costs and would design, finance, operate and maintain its four-tiered facility with minimal disruption to the 18-hole golf course during construction.
But since the pandemic, Topgolf said it, “like many other businesses across the U.S., is focused on responding and adapting to COVID-19 and the evolving nature of its business in light of this unprecedented pandemic.”
Topgolf had 58 locations spread across the U.S., the United Kingdom and Australia in February and closed more than 50 in March, subsequently announcing layoffs and furloughs. In recent months it has reopened many of its locations.