A less biased article on this topic:

Posted on: May 18, 2021 at 11:57:56 CT

https://slate.com/news-and-politics/2020/09/trump-taxes-golf-resort-losses-depreciation.html

".....But let’s get back to that $315.6 million in losses. Is it par for the golf-resort industry course to blow through that much money?

Golf courses have generally been a tough business over the past 10 to 15 years, so the owners I spoke to for this piece weren’t particularly surprised that Trump has been operating at a loss. There was a big upswing for the industry at the end of the last century, which led a lot of people to build courses, but the enthusiasm eventually waned, and supply has generally outstripped demand ever since. Trump notably bought his first golf property, the Trump International Golf Club in Palm Beach, in 1999. “An explosion in demand occurred in the late ’90s when the economy was booming and when Tiger Woods came into the game,” said Joe Hills, the developer and owner of golf courses in Illinois and Maryland. “Everything got overbuilt.” The economy also struggled, and golf became less a part of business networking. Hills estimates that the U.S. has lost somewhere between 7 million and 8 million golfers since 2007.*

Given these broader trends and challenges, actually making money from a golf course over the past two decades has generally meant being very lean with expenses, an attribute that Trump’s opulent properties certainly are not known for. Trump “puts more money into his golf courses than anybody I know,” said Mike Hatch, a golf consultant and owner of multiple courses in Virginia. “He’s buying distressed golf courses at a very cheap price and putting a substantial amount of money into them, so most of them are losing would be my guess.” Buying a property and shelling out a huge chunk of change for renovations—like palatial clubhouses, extravagant landscaping, and million-dollar waterfalls—likely means that a club will have to operate at a loss for decades until membership and initiation fees from high-end clientele catch up to the costs.

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Hills and Hatch both posited that much of these golf course losses were likely due to depreciation, the decline in an asset’s value that comes with use and other ravages of time. “I do not know many of Mr. Trump’s [properties] personally, but the ones I have seen, he had invested millions to make them premier facilities, so I would have thought his depreciation was substantial,” said Hatch. Trump has long attributed his losses to depreciation whenever tidbits of his tax returns reached the press in the past. Yet, as the Times piece pointed out, “Depreciation, though, is not a magic wand—it involves real money spent or borrowed to buy buildings or other assets that are expected to last years. Those costs must be spread out as expenses and deducted over the useful life of the asset.”But let’s get back to that $315.6 million in losses. Is it par for the golf-resort industry course to blow through that much money?

Golf courses have generally been a tough business over the past 10 to 15 years, so the owners I spoke to for this piece weren’t particularly surprised that Trump has been operating at a loss. There was a big upswing for the industry at the end of the last century, which led a lot of people to build courses, but the enthusiasm eventually waned, and supply has generally outstripped demand ever since. Trump notably bought his first golf property, the Trump International Golf Club in Palm Beach, in 1999. “An explosion in demand occurred in the late ’90s when the economy was booming and when Tiger Woods came into the game,” said Joe Hills, the developer and owner of golf courses in Illinois and Maryland. “Everything got overbuilt.” The economy also struggled, and golf became less a part of business networking. Hills estimates that the U.S. has lost somewhere between 7 million and 8 million golfers since 2007.*

Given these broader trends and challenges, actually making money from a golf course over the past two decades has generally meant being very lean with expenses, an attribute that Trump’s opulent properties certainly are not known for. Trump “puts more money into his golf courses than anybody I know,” said Mike Hatch, a golf consultant and owner of multiple courses in Virginia. “He’s buying distressed golf courses at a very cheap price and putting a substantial amount of money into them, so most of them are losing would be my guess.” Buying a property and shelling out a huge chunk of change for renovations—like palatial clubhouses, extravagant landscaping, and million-dollar waterfalls—likely means that a club will have to operate at a loss for decades until membership and initiation fees from high-end clientele catch up to the costs.

Hills and Hatch both posited that much of these golf course losses were likely due to depreciation, the decline in an asset’s value that comes with use and other ravages of time. “I do not know many of Mr. Trump’s [properties] personally, but the ones I have seen, he had invested millions to make them premier facilities, so I would have thought his depreciation was substantial,” said Hatch. Trump has long attributed his losses to depreciation whenever tidbits of his tax returns reached the press in the past. Yet, as the Times piece pointed out, “Depreciation, though, is not a magic wand—it involves real money spent or borrowed to buy buildings or other assets that are expected to last years. Those costs must be spread out as expenses and deducted over the useful life of the asset.”......