The irony is CoServ Realty's parent late last week filed bankruptcy petitions for its telephone and cable operations. CoServ Realty took control of the Beechwood holdings for the debt owed: $11.4 million against the 210-acre Creeks at Beechwood golf course and $44.7 million for the hotel and 15 surrounding acres. Officials say there were no other bidders. The transaction reportedly was a non-cash take-back totaling considerably more than the properties' values in today's hospitality market. It was the largest foreclosure to come down the pike in nearly a decade. CoServ held a cross-collateralization loan of $10 million for the golf course and $43 million for the hotel.
David R. Farmer, Beechwood Co.'s president and CFO, tells GlobeSt.com that 11th hour talks were shelved to stave the foreclosure via bankruptcy filings for the two single-asset LPs. "It was not the best path for us to take," he explains. "It was very unfortunate and we wish it would not have happened. A lot of blood, sweat and tears went into the development of those assets."
Farmer emphasizes the foreclosure carries no financial impact on the balance of the 902-acre Beechwood Business Park, situated in north Ft. Worth and practically adjacent to the Texas Motor Speedway. He opted to stay away from the foreclosure proceedings, capping an intense 60 days since the hotel's grand opening.
CoServ was reluctant to negotiate with Beechwood, pushing for foreclosure despite the hard times of the hospitality market. CoServ officials were not available to discuss whether the Westin branding would remain intact or the game plan for the holdings, such as looking for a buyer. Westin officials could not be reached by press time to discuss the branding and the status of its hotel management pact.
Farmer says the take-back requires CoServ to follow certain covenants with regard to the properties. Among those are easements and access within Dallas developer Frank Harrison's 902-acre, master-planned commercial development. Beechwood Business Park is interlaced with more than $100 million in infrastructure and amenities.
The Westin Beechwood and the Scottsdale, AZ-based Troon Golf-managed Creeks at Beechwood remained open yesterday. Ken McIntyre, golf course manager, says Troon talked with CoServ shortly after the foreclosure. "Our belief is CoServ has every intention to keep the property open," he tells GlobeSt.com. The course, in its second year, saw a near 50% jump in business over the Thanksgiving holiday, with every tee time being used Wednesday and Friday. The holiday brought 430 rounds in comparison to 300 in 2000, says McIntyre.
The golf course woes are being laid at the doorstep of spring flooding that forced a 45-day shutdown and costly repairs. The hotel...well, it's just the nature of the beast in today's market. And in Farmer's perspective, they remain two solid assets that can still be used for marketing, even though they are no longer in the Beechwood ownership hierarchy. It would be in everyone's best interest, he says, to maintain a "good neighbor" policy.
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