Crawford auction does not reflect market, Realtors say

by Carol Harris

SBJ Contributing Writer

While recent Branson theater and motel transactions have headlined area newspapers and coffee shop gossip, several local real estate professionals said they are unshaken by low selling prices of some properties. Specifically, property formerly owned by Branson businessman Dale Crawford which included the Ozark Mountain Buffet, two hotels, the Ozark Mountain Amphitheater and some commercial acreage sold through an absolute auction Jan. 29 for a total of $2,226,365.

Feb. 11, the Yellow Ribbon Theater was sold to lone bidder NationsBank N.A. for $3.75 million in a foreclosure auction at the Taney County Courthouse, according to NationsBank Vice President Gary Peterson, of St. Louis.

"I've not seen any panic because of this," said Jan James, a broker-owner at RE/MAX Associated Brokers Inc. She called the two sales "unique," and said, "They should not be setting the price for the market."

Chris Cooper, of Cooper Appraisal LLC, said, "The (Crawford) sale really did not affect the values of other motels. The values are not going to change overnight." Cooper, whose company appraised the Crawford properties, categorized the transaction as "a seller in distress," because of Crawford's health.

"An absolute auction means you'll take whatever," James added. "An absolute auction is extremely risky."

Dave Shaffer, who specializes in motel real estate through Shaffer Hospitality Brokerage Inc., called the Crawford transaction "a tremendous fluke." He said he had expected the properties to sell for about $8 million.

"The properties went for significantly less than what they were valued," Cooper said. However, he added, one reason for the low sale price was that the properties "were not being worked. Revenues were almost nothing.

"Motel values are directly related to motel revenues. The value depends on how well you're doing," he said.

While one of the Crawford motel properties sold for $5,600 per room, Cooper said, "I know of two or three motels that have good income streams that sold for more than $20,000" per room.

Shaffer said that, ironically, the day after the Crawford sale "we had the highest property price we've ever had" for the 500-room Crowne Plaza, which he said was reported to have sold for about $28 million, or $56,000 per room.

The potential value of Branson theaters is less clear. In a story published earlier in February by the Springfield Business Journal, NationsBank reported that the Yellow Ribbon Theater was appraised at $5.75 million on Dec. 13, 1996.

However, NationsBank entered filings that the value of the Yellow Ribbon Theater diminished $1.25 million between the time of a Chapter 11 bankruptcy filing by Falls Theater Partners LP in July 1997 and the end of last year. NationsBank stated reasons for the decrease in value included that Tony Orlando and Wayne Newton were leaving the theater, and there was no performance contract for 1998.

Cooper said, "in real estate, we call (the entertainers) anchors. The value of theaters and the properties around them are often heavily influenced by anchors." He added, however, "Just because Tony Orlando leaves doesn't mean that the theater is dead and gone. We don't look at it as a major impact."

Cooper gave the example the Country Tonite Theatre, which has apparently been successful for several years after replacing entertainer Ray Stevens.

Cooper, James and Shaffer all said they are optimistic about real estate sales for 1998. Cooper said last year's real estate market figures indicated a record year in 1997 for residential sales with home sales up 21 percent from 1996 final figures. Though, according to James, "There were still more properties that went on the market than were sold last year. It is still a buyer's market, but I'm very positive we are on a strong road to recovery. Steady growth is always better than rapid, spiked growth.

"Real estate has definitely stabilized," she said. "We're still in a holding pattern, with prices maybe starting to go back up a little by the end of 1998."

Regarding motels, Shaffer said, "Most properties have been doing well every year for the last three years." He also said, "We have had more motel sales in 1998 than all the (motel) sales in 1997. Prices are firming. I know of three potential office buildings people are working on now on Highway 248."

Shaffer said one new building is under contract to be built west of the Branson/Lakes Area Chamber of Commerce. The city of Branson also reported nearly $1.8 million in new construction for the month of January compared to $1.1 million for the same month last year.

New construction includes two, 12-unit condominium buildings at Falls Village and a clubhouse for Cedar Ridge at the Woods.

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