National Golf Properties Inc.'s share price has sagged in the past year, along with all real estate investment trusts. But as golf keeps surging in popularity due to the superstar status of Tiger Woods and the aging of the baby boomers, Santa Monica-based National Golf stands to benefit.

As the largest U.S. publicly traded company specializing in the acquisition and ownership of golf courses, National Golf reported same-course revenue growth of 5.7 percent in 1999 over the year before.

And even with its stock down, National Golf has been able to make select acquisitions. Last year, it picked up Meditrust's Cobblestone Golf Group in a $200 million deal, giving it 21 courses in its key market clusters. It also sold five courses for a total of $13.6 million in the past year.

"From a capital-raising standpoint, we don't need to issue equity, so the lower stock price is not hurting," said Jim Stanich, National Golf's president (and an occasional golfer). "We're able to think long-term and be patient and hopeful the (stock) price gets back up to where it's been in the past."

The Cobblestone acquisition was a double-edged sword, however. While those courses are expected to contribute this year to rent growth, they've also increased National Golf's floating-rate debt, which stands at $254 million. It was the best financing at the time, as National Golf's share price was down, but it also poses a problem when interest rates rise.

"The biggest risk for the company is the significant amount of floating-rate debt," said William Marks, an analyst at Banc of America Securities, who gives the stock at "buy" rating. "But that said, they're one of the safest REITs to invest in from a cash-flow perspective. We don't expect the debt to increase."

National Golf owns 150 courses nationwide and receives either a percentage of rent based on increasing annual revenue at each course or linked to inflation, whichever is greater.

After dipping below $19 a share in mid-December, National Golf and other REITs ticked up, possibly because billionaire investor Warren Buffett dispensed a tip to invest in REIT stock. But the momentum appears to be short-lived, as investors keep flocking to tech issues and other perceived growth sectors.

National Golf was trading at around $21.75 last week, down from $25.37 a year ago (and down from an all-time high of $35 in the summer 1997).

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