Tom Eggleston, who had been president and CEO of C.P. Morgan Communities in Indianapolis since June 2006, has resigned those positions and is starting a new business that will manage the resale of foreclosed properties from offices in at least six states.
Eggleston, 55, has signed a franchise agreement with The Benham REO Group, a five-year-old Concord, N.C.-based firm specializing in the disposition of bank-repossessed properties with sales offices that serve more than 100 cities in 14 states. Eggleston has acquired a license for the commercial rights to use The Benham REO Group's name and to apply its technology to facilitate the disposition of distressed properties in Nevada, Arizona, Colorado, Illinois, Michigan, and Ohio, states that have some of the highest inventories of foreclosed homes in the country. He told BUILDER this morning that he is also negotiating with the company to handle foreclosed properties in Indiana, and he intends to run his business from Indianapolis.
Steve MacFarland, who has served as C.P. Morgan's chief financial officer for 26 months, has been promoted to president and COO. (C.P. Morgan is not filling the CEO slot, confirmed company spokesperson Blair West.) Previously, MacFarland has been president of Masco Corp.'s Alsons subsidiary and vice president of finance for Delta Faucet. Eggleston says he left the builder voluntarily and has been discussing his departure with Chuck Morgan, its chairman, since early summer. Eggleston will continue to sit on the builder's board and said he and Morgan have discussed working together on future ventures. BUILDER was unable to reach Morgan for comment by press time.
Eggleston said he became familiar with The Benham REO Group—which was started in 2003 by two brothers, Jason and David Benham—when C.P. Morgan expanded into the Charlotte market. What attracts him to Benham is what he calls its "best of class" system that provides a quick and thorough assessment and analysis of a foreclosed property's valuation. On its Web site, The Benham REO Group guarantees to provide a broker price opinion (BPO) about a property's value to a lender or asset manager within 48 hours, and an occupancy check within two hours. The property owner or manager then decides who gets the listing and isn't obligated to pass it along to one of Benham's sales offices, although Eggleston contends that the comprehensive detail in Benham's valuation analyses gives it a competitive advantage over standard multiple-listing services and other REO firms. The Benham REO Group also offers a raft of services that includes closing and settlement management, property repair and improvement, eviction coordination, auction management, and loss mitigation consulting.
Eggleston sees parallels in this company's systematic approach to distressed property disposition with Driver's Mart Warehouse, which nine large car dealers started in the mid-1990s in response to the slapdash way the auto industry then was reselling used cars and brought on Eggleston as its CEO to run. Driver's Mart handled pre-owned vehicle sales via the Internet and worked through 23 elite car dealerships to close those transactions. (Driver's Mart was sold to AutoNation in 1998, where Eggleston worked for several years.) Eggleston sees The Benham Group's system bringing the same level of coordination to the process of foreclosure resales.
"Tom is a heavy hitter in the real estate industry, and he's going to help us open new avenues of growth," said David Benham during an interview this afternoon. Specifically, he says Eggleston is going to help The Benham REO Group market its brand not only to banks but also to investors across the country. Benham says that his company has 38 affiliated franchises in operation and expects to have 12 more opened by the end of this year. Eggleston will be opening offices for the company and finding his own key people to run them.
Eggleson says that when he joined C.P. Morgan, he wanted to expand the company into a five- to seven-city builder. It managed to expand into Charlotte and Raleigh, N.C., before the housing market collapsed. And as he launches a new company that is exploiting that collapse, Eggleston says a longer-range goal of his is to "find a way to help people stay in their homes" by "getting ahead of the foreclosure auction" and address the problems that put homeowners into financial distress in the first place.
John Caulfield is a senior editor for BUILDER magazine.