Where others see a distressed property, John Bushman sees an opportunity. - And Bushman sees plenty of opportunity in Colorado Springs. The Odessa, Texas, investor paid nearly $25 million in the past three years to buy the Crowne Plaza and Candlewood Suites hotels, the vacant former Macy's store at The Citadel mall, an 11,000-square-foot mansion in the Flying Horse development and 32.5 acres near the Colorado Springs Airport. Many of the properties were in foreclosure, bankruptcy or receivership, allowing his Investment Corp. of America to scoop them up for far less than what it would cost to rebuild them.
"I just see Colorado Springs as one of the beauty spots in the nation. I see a lot of upside from where it is at now," Bushman said. "I believe we can invest in properties, refresh them and make them a destination point. I think Colorado Springs has a wonderful long-term future."
Bushman first visited Colorado Springs 15 years ago when he came to coach his granddaughter's basketball team during a tournament at the Air Force Academy. He liked the climate and bought a home in the Broadmoor Resort Community as a place to spend the hottest months of the year; he and his wife, Carol, remain part-time Springs residents.
But it wasn't until 2010 that he began his buying spree in Colorado Springs, just as the area's unemployment rate peaked at 10 percent; he acquired the former Macy's store, which remains vacant since the retailer shuttered it in 2008.
He later acquired the Flying Horse mansion from a local bank, the Candlewood Suites from bankrupt developer Jannie Richardson, the land near the airport from a Kansas bank and the Crowne Plaza from a court-appointed receiver.
"Our strategy is to buy things that are down on their luck with the present owner and make additions to make the property better," Bushman said. "These are all long-term investments."
Commercial real estate agent Mike Helwege, a principal of Colorado Springs Commercial who handled two of Bushman's purchases, called him "a very sophisticated value investor."
"He is opportunistic and has to see value down the road, but he is patient," Helwege said. "That doesn't have to happen overnight."
A good example, Helwege said, is the land Bushman bought near the airport. He paid less than 20 percent of the amount the bank had loaned to a previous investor before foreclosing on the loan.
Bushman's purchase of the former Crowne Plaza, now called the Hotel Elegant?Conference and Event Center, is by far the company's largest investment. He acquired it for $14 million in May with plans to spend another $2 million replacing all guest room mattresses, adding a Starbucks Cafe, a Blue Bell Ice Cream parlor, a playground for children, a sports bar, a fire pit and outdoor seating. In a news release announcing ICA's acquisition of the property, he compared the 500-room hotel, the city's second-largest, with The Broadmoor.
"We may not quite be The Broadmoor, but we're the next best thing to it," he said in the release.
Alex Francis, former general manager of the Hotel Elegant? said Bushman is "passionate about the people who work for him."
"He is more focused on their well-being than the bottom line," said Francis, who left the hotel late last month for a position at a hotel in Orlando, Fla., citing family reasons.
Francis said he admires Bushman's "out-of-the-box thinking." For example, Francis said, Bushman installed carpeting in the hallway of the shopping mall he owns in Odessa - a move that goes against conventional real estate wisdom. But he did it anyway because research showed that consumers spent 45 minutes longer in malls with carpeted hallways.
Bargain hunting is not a new strategy for Bushman, who has accumulated a portfolio that includes seven hotels in Texas and New Mexico; the Music City Mall and three other shopping centers in Odessa; and six office buildings, a TV station and five radio stations, all in Odessa. He also has interests in the oil and natural gas and manufactured housing industries, including seven former sales sites in Texas and Louisiana.
Bushman, 72, got his start in businesswhen he was stationed at Camp Lejeune, a Marine Corps base in southeastern North Carolina, where he bought an automobile junkyard and started fixing cars and selling parts. After 3+ years in the Marines, he had trouble finding steady work, so he enlisted in the Army and ended up at Fort Hood in Texas.
In 1964, after leaving the Army, he went to Odessa because a driver training school there had an opening. He changed jobs and ran the local branch of a finance company for four years while attending junior college.
With $1,500, Bushman started a used-car dealership in Midland, Texas, in 1969. A year later he launched A-1 Homes, a mobile home business that would grow to 23 locations and later include a mobile-home manufacturing operation.
He continued to expand with new car franchises, an insurance agency specializing in mobile home and car insurance and eventually a savings and loan association. The S&L failed in 1988, costing him much of his business empire that had been merged into the thrift in an unsuccessful effort to keep it afloat.
"I was down to just what was left in my profit-sharing plan, but I still had a lot of good people who stayed with me as we started over," he said.
Bushman resurrected his mobile home operations under ICA in 1989 and eventually expanded to 30 company-owned locations, 30 franchise locations and five manufacturing plants. He sold the company to Champion Homes in 1998, but said he later bought back eight of the locations in Louisiana, New Mexico and Texas for a fraction of what Champion had paid for them.
Bushman said ICA beganacquiringloan portfolios, office buildings and other assets in the early 1990s from federal agenciesthat had been formed as part of the federal government's savings and loan industry bailout. ICA now holds more than 150 properties, including real estate that it began buying in Odessa in 1996. The first Odessa purchase was the Music City Mall, then 20 years old, 40 percent vacant, and in foreclosure. He bought a struggling Odessa television station three years later; within five years he transformed it into the top-rated station in the market and moved it to the mall.
Bushman bought his first hotel in 2001, a foreclosed property in Odessa, from the Federal Deposit Insurance Corp.
"We were under contract to buy our first hotel right before Sept. 11, 2011. We were able to get $100,000 knocked off the price after the attacks. It scared us because everything was collapsing in the travel and hospitality business. I couldn't resist going in and buying anyway," Bushman said.
It's a strategy that continues to pay off.
"Pretty much everything we owned but the manufactured housing business and the radio stations had been lender-owned or in receivership," he said.
Bushman is at an age when many people have retired, or are at least thinking about it, but he has no plans to join them.
"I have 1,200 employees now and there is nothing I enjoy more than talking about business," he said. "I enjoy business because for me it a hobby, not work, and it is fun."
Contact Wayne Heilman: 636-0234 Twitter @wayneheilman