Bank OREO Adds Up In Washington County

by George Waldon  on Monday, Jan. 27, 2014 12:00 am  

Washington County properties still held as "other real estate owned" by publicly traded Arkansas banks include (from left) the All Star Sports Arena in Springdale, an 11,000-SF home on Lovers Lane in Fayetteville and six ranch-style condominiums and 82 lots in The Pines at Springwoods, also in Fayetteville.

The balance sheets of Washington County lenders still reflect the financial splatter from the bursting real estate bubble.

The OREO portfolios held by the four publicly traded banking concerns based in Arkansas are a mixed lot that typify the overall market in the Fayetteville area.

The roster of land, homes and buildings recovered from bad loans (known as Other Real Estate Owned) has shrunk for some and grown for others through acquisition.

Little Rock’s Bank of the Ozarks significantly pared its Washington County OREO holdings in a $2.58 million transaction. Seven months ago, the bank sold 110 lots in the Waterford Estates at Hissom Ranch project east of Fayetteville near Goshen.

That June sale to Waterford Estates LLC of Dallas liquidated its position in the upscale residential development off Highway 45.

During its four years in the ownership picture, Bank of the Ozarks sold 71 lots to homebuilders and individuals for a combined $3.5 million.

The bank recouped more than $6 million in total. That’s a tidy sum, but well short of the $12 million loaned against the project.

Bank of the Ozarks took the property as part of a June 2009 settlement with Gary Combs, the northwest Arkansas developer who died in 2012.

The bank also took ownership of several hundred lots in the Sundowner Ranch residential development in Prairie Grove in connection with the Combs settlement. The property once secured more than $8.4 million of debt and remains a sizable chunk of OREO for Bank of the Ozarks.

Combs and other borrowers associated with Washington County OREO represent a who’s who casualty list of developers. (Click here or see end of article).

Dealing With OREO

That approach to dealing with OREO in Washington County is no different than elsewhere for Simmons First National Corp.



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