After entering receivership earlier this year, Gaillardia Golf and Country Club avoided the threat of its golf carts being repossessed, although the future of the club is still uncertain.
At least two groups are vying to purchase the country club property, which despite its luxurious facade, was saddled with heavy debt under its previous owners and needs an injection of cash.
A California-based company with deep pockets that has been scooping up distressed country clubs around the country now has its eyes on Gaillardia. A small group of members also want to buy the club, in hopes of bringing the property under local ownership.
Newport Beach, Calif.-based Concert Golf Partners, which buys luxurious but financially troubled golf properties across the country, has purchased the first mortgage on Gaillardia from Bank of the Ozarks and also has expressed interest in owning the country club. Concert Golf buys performing and nonperforming loans on golf properties from lenders, and also purchases private golf courses to own and operate.
Bank of the Ozarks elected to sell its mortgage on Gaillardia to Concert Golf in August after beginning foreclosure proceedings against Gaillardia owner Phil Herrington and his Little Rock, Ark.-based private equity firm Herrington Inc. Herrington Inc. had owned and operated Gaillardia since 2003 before the property fell into receivership.
Concert Golf is led by former Arnold Palmer Golf Management CEO and private equity maven Peter Nanula. In 2011, Concert Golf announced plans to buy up to $50 million in golf course assets, taking advantage of steep discounts on struggling country club properties after the Great Recession.
The company, which describes itself on its website as “well capitalized,” has not taken on any debt for its golf course acquisitions. Concert Golf pays cash for all of the courses it purchases. So far, the company has acquired four private golf courses in Florida and one in Washington DC.
Reached by phone at his Newport Beach office, Nanula confirmed that Concert Golf had purchased the note on the property, but would say little else.
“We're clearly interested,” said Nanula, who didn't want to talk more about Concert Golf's plans while Gaillardia is still tied up in foreclosure proceedings.
Oilman Jeff McDougall is leading a group of Gaillardia members who also want to purchase the club in hopes of keeping it in local hands. McDougall is president and owner of the Oklahoma City-based driller JMA Energy.
He also owns the largest house in Gaillardia, a more than 17,500 square-foot gabled mansion with multiple chimneys on three acres that looks like an English manor house.
“We're interested in the club as homeowners and members of the community,” McDougall said.
The group has been monitoring the foreclosure process with great interest in hopes of keeping the ownership of the club in Oklahoma City, McDougall said.
“We're just kind of waiting and trying to stay up on what is going on with the court,” McDougall said. “We're just a group in the club that would like to see it locally owned. We think it's the best thing for the community.”
Oklahoma City oilman Art Swanson, one of the founding members of Gaillardia, moved to hire a lawyer to intervene in the foreclosure proceedings on behalf of country club members earlier this year.
He worries that club members won't have a say in the future of the club and that more than $2 million in membership deposits held in a club account will be erased through the foreclosure process. The Gaillardia membership plan also gives the members the right of first refusal to purchase the club if it goes up for sale, Swanson believes.