Charlotte-based Campus Crest builds student-housing developments near universities around the country. According to the firm's Web site, it has 81 properties in 27 states--and that includes five projects under The Grove brand that are in operation or planned for Alabama (at South Alabama, Troy, Jacksonville State, Auburn, and Alabama).
As of August 2013, Wall Street investors had showered roughly $800 million on the company, and that figure probably tops $1 billion by now.
Ted Rollins belongs to one of the South's wealthiest families. His cousins, Gary and Randall Rollins, are Atlanta billionaires and direct Rollins Inc., the umbrella company for Orkin Pest Control and other profitable enterprises. The Atlanta side of the Rollins family, and their public squabbles over trust funds and divorces, was recently spotlighted in an article by reporter Clare O'Connor at Forbes magazine.
Wall Street was well aware of the messiness in Rollins personal life. Paula Poskon, an analyst with Robert W. Baird and Company, learned in October 2012 that Rollins had been convicted in 1995 for assaulting his stepson in Franklin County, North Carolina. She also learned that Rollins had been the target of a social-services investigation, based on a citizen complaint, for possible sexual abuse of the same stepson.
Poskon's reaction to this news? "Oh, my God, I was not aware of any of that. . . . It certainly sounds like I need to do a lot more digging."
Did Poskon do more digging? Apparently not. A few months later, she tried to strong arm me into retracting her statements about Ted Rollins.
Wall Street did not get alarmed, it seems, until Campus Crest Communities took a financial nosedive under Ted Rollins' leadership.
One account yesterday, from streetinsider.com, said Rollins "resigned." Another article, from seekingalpha.com, said Rollins had "been terminated, effective immediately." It also said "the stock price soared" as the news got out.
The company stock (with NYSE symbol CCG) had not been soaring lately. From Street Insider:
Campus Crest Communities (NYSE: CCG) reported Q3 FFO of $0.15, $0.01 worse than the analyst estimate of $0.16. Revenue for the quarter came in at $28.3 million versus the consensus estimate of $27.83 million.
The company also announced additional changes in senior management, as well as its intent to acquire Copper Beech assets, discontinue its construction and development business, reduce joint venture exposure and sell non-core assets as part of the Company’s release of financial results for the three months ended September 30, 2014.
Effective immediately, Ted W. Rollins, Chairman and Chief Executive Officer, has resigned and will no longer be actively involved with the Company. The Independent Directors of the Board of Directors of the Company have elected Richard Kahlbaugh, lead independent director, as Executive Chairman and Interim CEO. It is intended that Mr. Kahlbaugh will guide the Company through the completion of its strategic repositioning.
What about that "strategic repositioning"? Here is what it entails:
* Discontinuing all construction and development to simplify the business model and focus on organic growth;
* Identifying cost savings at the property and corporate level to enhance profitability;
* Reducing joint venture exposure through select asset dispositions to reduce indebtedness and increase liquidity;
* Exploring strategic options for our projects in Montreal, to include capital solutions to reduce exposure, concurrent with ongoing efforts to drive occupancy; and
* Marketing development pipeline assets for sale to increase liquidity and simplify balance sheet.
It sounds like Rollins' company was about as messy as his personal life--and that is pretty messy. We first became aware of Ted Rollins via Rollins v. Rollins, his divorce from second wife, Sherry Carroll Rollins, a Birmingham resident. The case was heard in Shelby County, Alabama, before Circuit Judge D. Al Crowson, even though clear law shows jurisdiction already had been established in South Carolina, and the case could not be heard anywhere else.
Crowson essentially stole a case that belonged to another state and proceeded to grant Ted Rollins such a favorable judgment that it left Sherry Rollins and the couple's two daughters on food stamps over large portions of the past six years. I've called Rollins v. Rollins the worst courtroom cheat job I've encountered in seven years of writing about Alabama legal issues.
Why might Ted Rollins receive favorable treatment in Alabama. His corporate law firm, Bradley Arant, is based in Birmingham.
Wall Street knew Ted Rollins had a criminal conviction that involved the physical abuse of a child, but analysts and investors remained mostly silent about that. An Alabama judge unlawfully took a divorce case and issued a grossly one-sided judgment--and appellate courts upheld it with an "affirmed, no opinion" ruling. The legal community has been mute about that.
What does that say about the values of Wall Street? What does that say about the values of our "justice system"?
While we ponder those questions, here are documents from Ted Rollins assault conviction in North Carolina: