An Arkansas bank has purchased approximately $19.7 million worth of loans at a federal auction of assets from the former Country Bank in Aledo, including those tied to the Fyre Lake National Golf Club in Sherrard.
First State Bank of Northwest Arkansas was the winning bidder, according to Lew Thompson, one of the bank's directors. Mr. Thompson declined to say how much the bank paid for the portfolio of notes, and Federal Deposit Insurance Corporation records were not immediately available.
According to the FDIC website, the portfolio of notes was being offered in four pools, which included the golf course and turf center, one to four family residences, golf course lots and membership interests.
Mr. Thompson said although the bank won the bidding, there is still a long process before it can do anything with the course. Foreclosure proceedings against the people who used the course as collateral for loans will have to be completed, and the title cleared. A spokesperson for the Mercer County recorder's office said there are multiple liens on the property.
Mr. Thompson said the delinquent notes could take up to six months to be cleared. He did not want to speculate on the future of the Fyre Lake course until those notes are cleared up.
"Too many things can happen on a note," he cautioned.
Mr. Thompson is not new to golf courses. A trucking company executive from Huntsville, Ark., he said he is the managing member of a partnership that owns golf courses in Rosscommon, Mich., and Montrose, Col..
The Rosscommon, Mich., course is called Forest Dunes. Mr. Thompson said it is a Tom Weiskoph designed course ranked as one of the top courses in the United States. The Colorado course is a Jack Nicklaus-designed course as is the Fyre Lake course.
Mr. Thompson said he believes there is great potential for the Fyre Lake course.
Fyre Lake National Golf Club, 12 miles south of the Quad Cities International Airport, was part of a 275-acre planned unit development that included 240 residential lots and a par-70 golf course built by Nicklaus Design Group, owned by Jack Nicklaus.
"You have roughly 400,000 people within a 15-mile radius," Mr. Thompson said. "There's huge potential because of the quality of the course and where it's at. It's an impressive facility."
The golf course, finished in 2010, originally was scheduled to open in spring 2011 but wasn't.
The former Country Bank, which provided much of the financing for the Fyre Lake development, was closed by state regulators in October 2011. Blackhawk Bank and Trust assumed al of Country Bank's deposits and a large portion of its loans, but the FDIC ended up with a number of non-performing loans.
The auction was held by the FDIC to recover as much of the $19.7 million portfolio as possible.
Blair Minton, of Bradley, one of the original investors in Fyre Lake and one of the defendants in foreclosure proceedings in U.S. District Court in Rock Island, said Thursday Fyre Lake is a beautiful course.
"They (First State Bank) will get title to it and somebody will buy it and make it a beautiful course," Mr. Minton said. "My guess is, in the early spring, it will open as the nicest course in the Quad-Cities. The only course that comes up to that is TPC (at Deere Run)."