The ambitious property established by a Bali expatriate who was soon after claimed by brain cancer has overcome near bankruptcy to emerge as a solid business, as one of its directors tells The Bali Times
It is not yet five years old — still an infant in the world of long-established businesses — but two years ago it looked all-but certain that the fledgling private-members’ club would come crashing down upon its Grecian pillars.
Reported by The Bali Times in March 2009, the administration of the Canggu Club was in wild disarray: multiple managers had come and gone; members — not enough to sustain the expensive investment — were in revolt at bad service and atrocious food; and cash reserves were dwindling to an unsustainable level.
It had been the vision of Steve Kenny, a Briton living in Bali who had achieved some fortune in the furniture-export business. But if anything, setting up a sizeable country club in the untamed environs of the North Kuta rice-farming area proved an endless vexation, according to people who were involved in the initial process. Kenny died aged 45 in late 2008 in Singapore, where he had been receiving treatment for a brain tumour, causing immense grief to those running the club. Today its library is named for the establishment’s founder.
Months before Kenny’s untimely death, the club had been undergoing a dramatic revitalisation, with a new management company taking over in March 2008, Strategic Hospitality Oceania, known as Shogroup. Its president director, James Wynne, a 29-year-old from Sydney, recollects those early days: “For the first six months we were basically treading water. There were some things to clean up and a lot of back of house to organise.”
Wynne ordered his sales and marketing operations to target new areas of revenue growth – the burgeoning villa sector, for example, whose guests could enjoy the sport, fitness and leisure facilities at his club, and his plan started to take off. “We have a fantastic team and they demonstrate a level of commitment to the business that simply wasn’t there before. I have learned that this is incredibly important if you are to have a shot at turning anything around,” said Wynne, who had labelled the property a “distressed asset” and had been planning to do a masters in Britain before he plunged into the Bali rescue venture, said.
With early success now in the form of drastically increased memberships, Wynne is relishing his hard-won accomplishment. “Unlike other people who demonstrate a lot more humility, I’ve enjoyed saying ‘I told you so’ to one or two of them. My key guys have been with me for more than two years and we are proud of the club. Without them it would be a different story. Back then I thought that it would take six months to get it back in the black. It was longer. But there were a couple of people, one in particular who was actually one of the original investors, that just never seemed to doubt the new course and believed in me. I will always be incredibly grateful for his unconditional support.”
Still, all has not gone according to the blueprint. A venture with the expat-owned Trattoria chain for an in-club pizzeria flopped, but it did attract new patrons and today, says Wynne, “with daily operations and events our kitchen and bars are humming and turnover has increased six-fold.”
The club shares its grounds in rapidly developing Canggu with the Canggu Community School, one of Bali’s biggest and fastest growing international schools whose students use its sporting facilities, providing revenue for the club that Wynne describes as “not significant.”
“We are two totally separate entities but what is not insignificant, however, is our working relationship. The club and the school have a fantastic relationship and many of the parents have joined the club. The notable contributions that the school have made are indirect ones. Having a school in the area has naturally impacted upon density in Canggu and encouraged residential development. It is only natural that to a certain extent we have fed off one another’s growth and success.”
The club — where membership costs US$1,500 with $65 in monthly dues (transferable and saleable for private members only) while daily and weekly runs to $50 and $250 — links some of its accomplishments to the local and national property sector. Wynne said that after his firm took over it was vital to recover the conviction of these big-spending realtors, who had turned their back on the club following the initial tumult.
“It was extremely difficult to regain the trust and support of the property industry in Bali after we took over. Many had been let down by the Canggu Club in the past and for some firms the club was somewhat of a dirty word. But Mal Ryan, our membership director, and I knew that without their initial support a successful turnaround, both in terms of perception and bottom-line, would be almost impossible. The club would be a very different place entirely if it were not for groups like Xclusive Property, Elite Havens and others. Their support facilitated that initial change in trend. They helped change perceptions, which in turn changed the reality, which lead to our success today.”
And as for all that development in Canggu, where ricefields are being sold off and carved up at a rapid clip, Wynne is exuberant.
“I am a businessman and I do believe that the club has contributed to positive growth in the area. From an economic standpoint it has obviously had a dramatic impact on land prices, as well as driven the growth of small business, in addition to residential development. Do I believe that the growth has been adequately planned for? Probably not. Would I like to see more regulation and control in regards to development? Absolutely.”