Will wealthy golfers pay millions for winters in St. Andrews?
Herb Kohler is betting that they will. Kohler, the American owner of Whistling Straits and the Old Course Hotel in St. Andrews, bought Hamilton Hall -- the iconic red sandstone building located across the street from the 18th green of the Old Course -- in 2009 for 11.5 million pounds (about $18.5 million) and he will reopen it next year as luxury residences after a renovation that Kohler has said will cost at least twice as much as his purchase price.
Hamilton Hall first opened as a hotel in 1895, and was later used as training headquarters for the Royal Air Force during World War II. After the war, it was a St. Andrews University dormitory until 2006. Kohler bought it in 2009 after two previous failed ownerships. Renamed the Hamilton Grand, the property will include 26 luxury residences, with prices ranging from $2 million for two bedrooms to more than $11.5 million for a four-bedroom penthouse. Five apartments have already been sold, with all work expected to finish by the end of this year, according to the Kohler Company. Owners can rent their units as apartments, but pricing is not yet available. The Hamilton Grand will also have a pub and grill open to the public.
Two local businessmen agreed that the revamped hall will have a positive impact on the town's economy, although one had doubts about the long-term prospects of the property.
“It was a mess when Herb Kohler bought it, and it's a lot different now,” said Jack Willoughby, owner of The Dunvegan, a popular pub and eight-bedroom hotel a few hundred yards up Golf Place from the Hamilton Grand.
Willoughby said his pub was not affected by the construction work on Hamilton Hall.
"There have been no surprises, and it's been done very efficiently," Willoughby said. "We welcome competition and I don't think it's going to have any adverse effect on us because we're small and more of a 19th hole destination. They are much more upper market. If it brings more people to this corner, that’s good for everyone.”
However, Eric Brown was less than thrilled with the past 18 months of heavy renovations. Brown is the general manager of the Best Western Scores Hotel, adjacent to the Hamilton Grand, and he said the renovation work on Hamilton Hall generated significant noise and extensive dust.
“We considered whether we might close part of the hotel during the winter but decided to make the best of things by offering special rates and concessions,” Brown said. His hotel has also undergone new construction recently, and has plans for a 30-bedroom extension—scheduled for completion by the 2015 British Open in St. Andrews—to which Kohler objected. The hotel’s food and beverage business has also been affected negatively due to pedestrian diversions and obscured views of the Old Course, Brown said.
Still, Brown said he sees the completion of the Hamilton Grand as more of an opportunity than a threat, anticipating increased business for the four restaurants and bars in his hotel.
Willoughby, however, issued a cautionary note based on running his own business in St. Andrews for the past 19 years.
“I've seen a lot of people come and go in this town," the pub owner said. “The winters here, people just don't understand. Those guys [Kohler] know a hell of a lot more than me when it comes to selling up-market real estate. But the winters here are not the best. A lot of people don't take that into account. I'm not saying that's going to happen in this case, but it might have happened to the last guy who lost money on trying to build time-shares there. But I'm sure weather won't deter their decision-making process for people with that kind of money.”
Hamilton Grand owners will not receive guaranteed tee times at the Old Course or on-site parking (valet service will be provided from the Old Course Hotel), but they will receive membership at the nearby Duke’s Course, also owned by the Kohler Company.
Editors' Note: In an earlier version of this story, the attribution for the final quote was not clear. It was Jack Willoughby, owner of The Dunvegan, who was speaking, not Eric Brown, general manager of the Best Western.