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Textron Financial Corporation REO portfolio

Case Study

Challenge: Textron Financial Corporation (TFC) was the largest lender in the golf course space. Senior management for the company’s real estate owned (REO) portfolio was very experienced in all phases of course operations and disposition. In February 2012, at the annual National Golf Course Owners Association conference, company executives informed the industry that they were starting a “wind down” of the division. In February 2013, after we had already demonstrated considerable success in disposition of their REO assets across the country, TFC awarded Colliers the listing on the remaining 11-course REO portfolio.

All of the courses in the portfolio had been previously listed with other brokers, and some had been marketed without success for as long as two years. Most, if not all, logical buyers had seen the assets and reviewed collateral material on the properties. In addition, the majority of properties had physical plant issues that buyers perceived as impediments to sale.

The challenge was to reintroduce the properties to the market in a way that created buzz, attracted new buyers and turned physical plant issues into opportunities.

Strategy: Given the total revenues of each course and the markets where the assets were located, we determined that the new class of entrepreneurial first-time buyers, which had yet to be as active as most in the industry had predicted, were our target buyers. Our team felt that if the prices were set at asking values that gave buyers an opportunity for an appropriate going-in return on investment, the physical plant issues could be shifted from impediment to a reason the buyer was able to acquire at an attractive price.

The asking price reduction was minimal, and it did not impact the disposition price that had been set earlier. It only reduced the spread between asking and disposition value. We then worked at turning asset issues into opportunities by exposing them to prospects immediately instead of making them part of the discovery process.

Result: With reworked, publicly listed asking prices and a new marketing campaign targeted at local and regional first-time buyers, we had immediate success. By utilizing a marketing campaign that illustrated one property after another going to escrow and closing, we generated sales momentum for properties that had previously been on the market for a year or more, and that sales momentum built exponentially sale after sale.

From the listing origination in February 2013 through the end of February 2014, we sold nine of the 11 courses. Seven of the nine buyers fit our model of “new buyer.” Of the two remaining properties, one is still undeliverable due to long-standing litigation over easement and boundary issues, and the other had a sale interrupted during escrow by the city shutting half the course down to expand its sewer line capacity.

Despite physical plant issues that ran the gambit, only one buyer over the course of the sales dropped out of escrow, and he did so after learning that a nearby club was in financial trouble. That buyer was replaced immediately by a backup buyer who closed the sale in short order.


“We engaged Colliers based on their comprehensive experience in the golf industry overall and specific market knowledge. Their combined contributions to the sales process were extremely valuable in navigating very difficult and complex transactions.”

Jerry Hickley
Senior Vice President, Managing Director
Real Estate Assets at Textron Financial