Eight years ago, Du Sha cashed out his chain of home-improvement centers — the first superstores of their kind in China — with a sale to Home Depot for $100 million.

Today, with a net worth of more than $600 million, the former economics professor has taken up the conventional pastime for those with money and time: golf.

Du has bigger plans than reducing his handicap. Teaming with a Canadian golf executive, he has bankrolled Pacific Links International, which now owns 10 high-end U.S. courses, including the $20-million Dove Canyon Golf Club, in a private community abutting the Cleveland National Forest in south Orange County.

Du and other wealthy Chinese investors are quickly adding golf courses to their growing portfolios of U.S. holdings. In the last year, Chinese investors have bought prime properties including the 2,000-acre Sea Trail Golf Resort, built around three Sunset Beach, N.C., courses, along with smaller ones, such as Rancho Duarte Golf Club, a nine-hole, par-31 course built on a former dump in the San Gabriel Valley.


“We’re seeing a lot of tires getting kicked by the Chinese,” said broker Jeffrey Woolson in Carlsbad, managing director for golf and resorts at real estate services giant CBRE Group Inc. “They only recently came forward and started buying. They do love golf, so it makes sense.”

The influx is restoring the fortunes of some unprofitable clubs such as Dove Canyon, where Pacific Links has committed $6.2 million to refurbishments after buying the property last year.

The investments also mark the third wave of golf course purchases by Asian investors. Unlike the Japanese and the South Koreans before them, the Chinese are buying at the bottom of the market. But they are entering an overbuilt industry that has suffered from declining American interest in golf since well before the Great Recession drove many courses into bankruptcy.

The purchases of U.S. golf courses follow a long series of investments by wealthy Chinese in other areas — such as Gov. Jerry Brown’s pet housing project in Oakland and the AMC Theatres chain. Chinese investors also have purchased Sheraton hotels in Universal City and at Los Angeles International Airport and helped ignite such red-hot California housing markets as Arcadia and Irvine.


Major Chinese investments in U.S. businesses doubled to $14 billion last year — and added $8 billion more in the first three months this year, according to Rhodium Group, a New York economic consulting firm.

Thilo Hanemann, Rhodium’s research director, said wealthy Chinese individuals and companies are rushing to get money out of China, where the government is trying to gently deflate a property bubble, and into U.S. real estate and entertainment.

“Most Chinese have 90% of their assets in China, and most of that is in real estate,” Hanemann said. “It was a great place to be over the last 10 years. They made a lot of money. But the domestic Chinese market is now very fragile. And from an investment perspective, it’s not good to put all your assets in one basket.”

One of the more curious aspects about their U.S. golf ventures is the stark contrast with the sport’s rise in China.


Banned as bourgeois excess under communist dictator Mao Zedong, golf started gaining appeal in China in the 1980s as courses began springing up. They often were designed by American firms as enticements for buyers of expensive adjacent housing.

Comparatively few in number and extremely expensive to play, the courses still became popular venues for the financial elite, who cut deals during all-day sessions of playing, eating and drinking, much as their U.S. counterparts once did.

Pacific Links has dropped membership fees in China to $20,000 — compared with the $160,000 or so that courses there typically charge. But the company is also looking to offer its Chinese members access to U.S. golf destinations, capitalizing on a surge in Chinese tourism here.

The company has clustered most of its courses in prime destinations for Chinese tourists, including five public courses on Oahu and three private clubs in Las Vegas. It also owns the Bridgeport, W.Va., golf club named for legendary course designer Pete Dye, and it is overhauling its 11th property, a golf resort in Du’s hometown of Tianjin, into a luxury playground.


Chinese members can also play at a discount in scores of affiliated high-end courses in North America, Asia and Australia. Du said the membership card gives Chinese golfers “the experience they’ve been looking for: a single membership that provides access to over 160 high-end courses around the world.”

The company charges U.S. customers differently. Golfers join courses individually, with memberships ranging from $10,000 at the SouthShore Golf Club in Las Vegas to $50,000 at the Southern Highlands Golf Club, also in Las Vegas. Members get access to other Pacific Links courses but not preferred tee times.

Dove Canyon member Mary George Gilman of Laguna Niguel said she and other frequent players at the club are “thrilled” by the opportunity to play other courses in the company’s network.

“We’re out in Las Vegas all the time, playing courses as good as Dove,” Gilman said. One of the clubs there, Southern Highlands, “is a five-star, beautiful course — really, really nice for avid golfers like us.”


Pacific Links, which has about 4,000 members worldwide, plans to buy two or three more Southern California courses, said Harry Turner, the company’s vice president for mainland U.S. operations.

Du and other Chinese investors in U.S. golf courses are working to make sure this third round of Asian acquisitions won’t go the way of the previous two, which occurred during real estate bubbles that burst.

Japanese buyers in the 1980s and early 1990s often were left underwater after a spree of trophy purchases — including the $1-billion acquisition of Pebble Beach resort in 1990. The new owners of Pebble Beach, under financial stress, sold the resort two years later at a loss of $300 million.

Many Koreans and Korean Americans who bought courses a decade ago in Southern California found themselves upside down during the Great Recession. A Korean group that bought the Rancho Duarte club in 2004 ended up in foreclosure, and the property was sold last year for $3.3 million to Americasia Investment, a company owned by Chinese investors.


The latest wave of Asian golf investment may be different, said Terry Vanek, a specialist in golf properties for the Marcus & Millichap real estate brokerage in Tampa, Fla.

A Marcus & Millichap analysis called 2013 “a pivotal year of improvement” for the industry, with the median prices of courses up slightly for the first time since 2006. More than half the company’s golf course listings generate Asian interest, Vanek said.

Letsgo, a new e-commerce arm of Tianjin Sun Investment Group in China, hopes to capitalize on that interest by matching Chinese buyers with brokers selling North American golf courses.

“A golf course is a kind of symbol of status — a thing you can be proud of and show off,” said Letsgo manager Judy Gao.


Temple City real estate broker Peter Lam, a Chinese investment specialist who represented the Rancho Duarte buyers, warned that potential investors should enter the market “only if they have money to burn.”

Overbuilding in the 1990s and a sharp downturn in usage, he said, have resulted in too many courses and not enough players.

It’s hard, though, to overcome the fact that, from a Chinese perspective, the U.S. courses can look like screaming bargains.

“You’re seeing courses sell for less than $2 million that back in 2004 or 2005 would have cost more than $5 million,” said Chris Charnas of Links Capital Advisors, a brokerage in the Chicago suburb of Evanston.


In December he arranged the sale of Chalet Hills Golf Club, a foreclosed course in Oakwood Hills, Ill., for $1.5 million. Charnas said the buyer was a Chinese investor, who commented: “This is like a $15-million deal in China.”

In Rancho Santa Margarita, Du Sha’s group took over a club that had never made a profit and had been losing nearly $1 million a year as membership stagnated. Pacific Links acquired Dove Canyon from the U.S. arm of Japanese noodle maker Sanyo Foods, which had owned it since 1992 and still owns three other Southern California courses.

Dove Canyon raised the initial membership fee to $13,500 from $8,000 and still picked up nearly 75 new members in the last year, said Russell Sylte, the club’s director of operations. It now has 401 golfing members and 245 who pay $2,500 for non-golfing social privileges or $1,500 to be able to use the dining room.

“The club will turn a profit this year for the first time,” Sylte said.


scott.reckard@latimes.com

Twitter: @ScottReckard