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Partnership with Chicago firm seeks to catch foreclosure wavePaul Coury

Journal Record, February 22, 2010


TULSA - Tulsa real estate developer Paul Coury and Chicago hospitality analyst Robin Hunden have created a firm to capitalize on growing hotel loan problems across the Midwest.

"We're seeing this wave of foreclosures and distressed properties and trying to offer assistance to many banks who really have no idea how to manage these assets they're taking on in record numbers," said Hunden, president of the research and advisory firm Hunden Strategic Partners.

Their new company, HC Hospitality Asset Management, draws on Coury's 28-year experience as a banker, property broker, hotel operator, construction manager and court-appointed receiver. Hunden augments that with extensive feasibility and performance research capabilities.

"We're combining his expertise on evaluating the market with mine on renovating and managing the property," said Coury, chairman of Coury Properties and the Coury Collection of boutique hotels.

While many national real estate companies offer asset management services, Hunden said they remain focused on major markets. Those first-tier regions experienced far more problems than Oklahoma over the last decade, although Coury expects more banks in this region to face that challenge this year.

He pointed to data suggesting 85 percent of hotels tied to commercial mortgage backed securities are now valued below their loans.

"We think a lot of the hotels that have managed to hold on so far will have trouble and they will be turned back into their lenders this year," said Hunden. "Things have not turned out as they expected. The assumptions that many hotel properties undertook over the last two years were unrealistic in any market The assumptions never matched the fundamentals."

Since many lenders would prefer to avoid foreclosure, Coury and Hunden have started approaching regional Midwest bankers to introduce them to HC Hospitality Asset Management A separate Web site touting the new company is under development.

By tapping the capabilities of their affiliated companies, the new joint venture will offer turnkey services for analyzing, stabilizing, repositioning, and selling distressed hotels.

"The right company should be able to do all those things for you," said Coury. "If they do that, they will bring you the value added proposal you need." Hunden said the duo would start small, building the company through relationships.

"We have a business plan but we're not going to try and get out there and do a dozen properties this year," Hunden said. "Because we take the individualized approach, we want to have one or two or three properties and grow it from there. This is not a financial bonanza that we're looking for. We're looking to grow a slow but sure business that has long-term potential."

By effectively serving lender needs, Coury expects bankers to bring other prop erties to HC as issues develop. He entered commercial real estate that way, starting Coury Properties in 1985 as a count-appointed receiver and asset manager during one of Oklahoma's deepest recessions. That gave him firsthand experience with the Catch-22 problems of selling trou bled assets in a bargain hunter's market place.

"It was like sharks marking blood," Coury recalled of the Resolution Trust Corp. era.

"In the beginning they don't want to sell below value," Coury said of banks. "In the end they just want to get rid of it."

Those difficulties led Coury to enter property ownership in the mid-1990s. That in turn led him into the hospitality sector with Tulsa's revitalized Ambassador Hotel.

While Coury Properties now draws more revenue from managing performing assets, it also serves as receiver for two troubled properties. Coury has two others under dis cussion, along with two hotels for the HC team.

"It has unlimited growth potential," Coury said of the receivership market.