There comes a point-in-time when Americans have to inquire whom precisely owns what in America. Normally, that question is asked when mergers take place. The Property Preservation Industry seems to be exempted. This is an intro to a story we are putting together in response to the partial ownership of some of the biggest names in the Industry which will take place on or about 01 October, 2013, by a London based firm TDR Capital.
The odd man out, with respect to foreign national ownership, has always been Field Asset Services (FAS). FAS is predominately controlled by First Service, a Canadian based firm. That fact seems to have escaped the FAS Our Story Page, though.
TDR Capital’s partnership with Concentric Equity Partners (CEP) has put together the largest coup in recent memory with respect to the Property Preservation Industry. The days of Americans controlling their own destinies has now left. Sad, really.
Concentric Equity Partners (CEP) and TDR Capital (TDR) announce the formation of a new holding company to establish a suite of mortgage field services companies comprising of MCS, Asset Management Specialists (AMS) and Vacant Property Specialists (VPS).
Read: Due to the fact that Wells Fargo is pissed off at Safeguard Properties (SGP) and Lender Processing Services (LPS) for refusing to rein in their foreign outsourcing of photos, they are going to HEAVILY CONTEMPLATE moving their Portfolio to Mortgage Contracting Services (MCS). If you think, “So, what,” you had better do the math: Wells Fargo controls a large swath of the Industry work on the pre conveyance end.
MCS and AMSREO got with the program awhile back: Ditch the addiction to foreign outsourcing or loose work. Strange, really, when you look at the heavy impact Wells Fargo made by outsourcing to Bangalore.
“Businesses and functional areas are investigating what markets are most economically attractive, with access to the best talent, both internationally (including India and the Philippines) and domestically,” Wells Fargo & Company spokeswoman Bridget Braxton told PTI from San Francisco, California.
You are seeing the consolidation and constriction which I predicted over a year ago finally coming to fruition. Regional Order Mills should be the ones most worried.
The additional irony is the heavy Wells Fargo demands to push Aspen Grove Solutions (AGS), yet another foreign nationally controlled firm, for taking over the Background Checks of Contractors.
One of the biggest issues which may come into play is the requirement of the US Department of Housing and Urban Development (HUD) upon Contract Holders to not mix pre and post conveyance Federal Housing Administration (FHA) properties.
AMS and every other FSM agreed in a MOD (late 2011 perhaps) to the following language from the 3.6 PWS:C.5.1.12.5 Prohibition on Pre-Conveyance Preservation and Protection Work The Field Service Manager or its agent is prohibited from performing both pre-conveyance work on FHA Single Family Insured properties. In the event that the a Field Service Manager or its agent performs pre-conveyance work, the fees associated with post-conveyance work are expressly unallowable and will not be paid. The Field Service Manager must obtain written certification on an annual basis from its subcontractors affirming that they do not perform pre-conveyance work on FHA Single Family Insured properties.
The above was brought up in the past by Foreclosurepedia. To date, HUD has not had the stomach to really look into any issues. If any arise in the above, I presume their decision will be the same. Business as usual; just like the Asset Management fiasco winding its way through the Courts now.
The real question is why didn’t an American Firm step in on the action? Liability is my answer. No one wants to pony the entire amount of cash domestically for an endeavor like this. Additionally, most Investors have already heard that Regulations are coming and they want no part of the paperwork.
We are going to stay on top of this fast moving story. If I were a Contractor, my first email tomorrow morning would be to any of the above mentioned Companies asking for a layman’s terms statement on how this Merger was going to impact them getting paid. There are still large Firms attempting to be paid from the absorption of the Bank of America (BANA) Servicing by SGP.
