Resolution Trust Corporation:

Evaluations Needed to Identify the Most Effective Land Sales Methods

GGD-95-43: Published: Apr 13, 1995. Publicly Released: Apr 13, 1995.

Additional Materials:

Contact:

J. William Gadsby
(202) 512-8387
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

GAO reviewed the Resolution Trust Corporation's (RTC) land disposition activities, focusing on whether RTC: (1) developed and implemented a strategy to dispose of its land assets; and (2) assessed the results of its land sales initiatives to identify the most cost-effective disposition methods and best practices.

GAO found that RTC: (1) adopted a land disposition strategy in May 1992 and formed a land task force to analyze its land inventory; (2) disposed of about $16 billion in land and loans between January 1993 and June 1994, although it had about $850 million in these assets remaining unsold as of February 1995; (3) was unable to identify the most effective land disposition methods because it failed to develop a formal procedure to collect all the actual expense data related to each land sales initiative or establish a methodology for evaluating the results of each initiative; and (4) issued a directive requiring that the expenses for each multiasset sales initiative be documented, which should allow it to identify the most effective marketing and sales techniques and best practices.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: RTC has implemented a standard methodology for evaluating the results of all major sales initiatives. This methodology was used to update RTC's 1995 Business Plan. Additionally, in August 1994, RTC issued a directive to establish standard procedures for tracking multi-asset sales expenses and on March 6, 1995, a policy memorandum was issued to help insure timely reporting of the sales expenses.

    Recommendation: The Deputy and Acting Chief Executive Officer, RTC, should direct the Vice President of Asset Sales and Management to develop an appropriate standard methodology for evaluating the results of land sales initiatives.

    Agency Affected: Resolution Trust Corporation

  2. Status: Closed - Implemented

    Comments: RTC requires that all sales cases include a discussion on the best disposition strategy for the assets in the sale based on a number of factors, including the Business Plan priorities and the recovery rates from previous sales. The results of the sale, including a cash equivalent price, are now being captured in a database and a formal comparative recovery rate analysis is performed periodically. If the proper expense and sales data are not submitted after the sale, a follow-up request is sent to the staff conducting the sale.

    Recommendation: The Deputy and Acting Chief Executive Officer, RTC, should direct the Vice President of Asset Sales and Management to ensure that required evaluations are done at the completion of each land sales initiative to identify the best sales methods and most effective marketing techniques, and promote their use on future land sales initiatives.

    Agency Affected: Resolution Trust Corporation

 

Explore the full database of GAO's Open Recommendations »

Sep 29, 2016

Jul 25, 2016

Jul 5, 2016

May 6, 2016

Apr 21, 2016

Apr 18, 2016

Apr 12, 2016

Mar 28, 2016

Mar 8, 2016

Feb 16, 2016

Looking for more? Browse all our products here