Duke Energy Makes Major Investment in GreenTrees

Duke Energy has become the lead investor in GreenTrees, a privately managed forest restoration program created and managed by C2I for landowners in the Lower Mississippi Alluvial Valley: Illinois, Missouri, Kentucky, Tennessee, Arkansas, Mississippi, and Louisiana.

This enormous valley once held 24.7 million acres of forest and emergent wetlands. Today more than 18 million acres – or 80 percent – has been cleared, resulting in the loss of critical natural habitat.

The program is expected to generate high-quality, verifiable carbon offsets that Duke believes will help reduce the overall cost of compliance with federal climate change legislation. Duke’s initial investment will result in the planting of more than 1 million trees on approximately 1,700 acres in Arkansas.

GreenTrees is designed to create, enhance, and sustain conservation and wildlife benefits from afforestation. GreenTrees provides landowners the most economic and environmental value for each acre of trees planted. The program utilizes a specific inter-planting of 302 cottonwoods plus 302 mixed hardwoods per acre. The specific design of 302/302 delivers more conservation value, more carbon, and better sustainable hardwood revenues than a previous design of 302 cottonwood and 151 hardwoods.

In exchange for the landowners’ long-term lease to prevent reversibility, GreenTrees offers a variety of short and long-term income opportunities. Landowners can simultaneously enroll the same qualified acres into GreenTrees, CRP, and other conservation practices, thus receiving multiple financial incentives and incomes together.

GreenTrees was founded by Izaak Walton League of America board member Carey Crane and Texaco Chevron Conservation Award recipient Chandler Van Voorhis. Both men have received great inspiration from Crane’s mother, Maggie Bryant. Bryant is a past-two term Chairperson of the National Fish and Wildlife Foundation and retired from her board position in 2001. She has been awarded the prestigious Chevron Conservation Award as well as the Governor’s Award for Conservation in Mississippi, and she continues to be active in conservation measures around the world.

Landowners are enthusiastic about GreenTrees. Arkansas landowner Brandon Stafford is a recent enrollee. Stafford found himself with 210 acres of un-irrigated farmland that he had to do something with. He enrolled it in CRP and GreenTrees. After the initial planting and subsequent sprayings Brandon says, “It’s amazing what the trees are doing.” The CRP and GreenTrees programs work in concert for him. Currently over 2,500 acres from 20 landowners are enrolled in the program.

To learn more about GreenTrees, visit their website: www.green-trees.com.

Fortune Reports Soros and Rothschild Invested in Land

As millions of landowners already know, investing in a piece of property does more than just bring piece of mind. It can bring an excellent return. This story is one worth repeating, particularly in today’s economic climate when Americans have witnessed the demise of blue chip investments such as AIG, Bear Stearns, and Circuit City.

But landowners aren’t the only ones with an eye to a good return. As the following article from Fortune attests, some of the world’s savviest investors recognize the potential for substantial returns, including hedge fund manager George Soros and banking scion Jacob Rothschild.

Pay particular attention to the paragraphs that focus on Shonda Warner, an ex derivatives trader for Goldman Sachs who launched Chess Ag Full Partners, an investment firm that acquires undervalued farmland.

In exchange for a seven-year lockup, a 2% management fee, and 20% of profits, she figures she can deliver the investors in her first fund an annual return of 13% to 16% – about 4% to 6% from crop yields, around 8% from land appreciation, and the rest from hedging.

Based on historical returns for farmland, that’s an attainable goal. According to research by Terry Kastens and Kevin Dhuyvetter, professors of agricultural economics at Kansas State University whom Warner recruited to be advisory partners in her fund, the average annual return on U.S. farmland since 1950, including crop yield and land appreciation, is 11.5%, vs. a 12% annualized total return for the stock market. And the farm returns actually came with about half the volatility of stocks.

Read more at:
“Betting the Farm,” Fortune, June 10, 2009.

170 Acres on the Block Saturday in Illinois

Update: The complete tract of land went unsold during the brief auction. The first tract at 50 acres was passed on at $120,000, the second tract at 40 acres was unsold at $96,000 and the third tract at 80 acres was unsold at $192,000. A combination of all three tracts was passed on as well.

170 acres, broken up into three tracts of 50, 40 and 80 acres, goes on the block Saturday in Marion County, IL. The land can be used both for hunting and CRP income. Buy A Farm Land and Auction Co. will host the bidding.

The minimum opening bids on the property start at $2,400 an acre.

Located on Blackburn Road, 15 minutes from I-57 in Centralia, the property could be a solid buy if you happened to scoop up all three parcels. Each has a decent CRP income; they total about $6,500 per year. According to the listing, deer abound on the property.

This would make a nice long weekend retreat for hunters in St. Louis or Chicago.

Bids will be taken at the Iuka Grade School or online. 10% down is required at the end of the auction with the balance at closing.

Western Massachusetts to Become National Forest?

Former Governor Mitt Romney’s proposal to designate the Berkshires and all of Western Massachusetts as national forest is being considered once again. Massachusetts is one of just six states without national forest designation, a situation the Romney administration sought to counter in 2003.

A key aspect of the proposal being considered is that the federal government would not acquire any private land. Instead, it would seek easements from local property owners to restrict development and thus allow the land to remain on tax rolls.

The proposed Massachusetts model, which is being called a “family-forest based” designation, is being pitched as a partnership between private landowners, the state, and the federal government.

“”Landowners would retain the rights to own the lands, but sell their right to develop it,” said Lisa Capone of the state’s Executive Office of Energy and Environmental Affairs. “The land also remains a working forest, with some level of access to outdoor recreation and protection from commercial development. Massachusetts would be the first state to have the land-easement concept.”

Crescent Resources Files for Chapter 11 Bankruptcy

Charlotte-based Crescent Resources filed for bankruptcy protection in Austin on June 10 listing assets and liabilities in excess of $1 billion. Founded in 1969, the developer is owned by Duke Energy and Morgan Stanley’s real-estate fund unit and has interests in 35 residential and commercial projects in 10 states, including country-club communities, mixed-use developments, and Class A office space in the Southeast and Southwest.

Crescent lost $420 million in 2008, according to the Charlotte Observer, and will seek protection from as many as 10,000 creditors.

The company issued the following press release at its website:

Crescent Resources announced that, as part of its ongoing strategy to reduce the company’s debt level and improve its capital structure, Crescent Resources, LLC and certain of its subsidiaries have filed voluntary Chapter 11 petitions in the U.S. Bankruptcy Court in the Western District of Texas, Austin Division.

The company intends to operate its continuing businesses without any significant interruption during the restructuring process. In addition, the company has obtained a Debtor-in-Possession financing facility of $110 million from a group of its existing lenders, which will provide sufficient funds to operate its ongoing business activities.

Crescent also announced today that Arthur Fields, chief executive officer of Crescent Resources, has retired from the company and will continue to work with the company in an advisory capacity. Effective immediately, Andrew Hede, Crescent’s chief restructuring officer, will also serve as chief executive officer. Mr. Hede, a managing director with Alvarez & Marsal North America, LLC, has more than 15 years of financial restructuring and business experience. Mr. Hede has worked with numerous companies, including national and regional homebuilders and real estate developers, to develop and implement financial and operational restructurings and recapitalization strategies.

“We have been in active discussions with our lenders and other stakeholders as we work towards an agreement that will bring our capital structure in line with the current economic environment,” said Andrew Hede. “Those discussions are continuing, and we are pleased with the ongoing support we have received from our lenders. We believe this process will lead to a stronger financial foundation for the company and its stakeholders and that it will better position us to serve our customers and partners over the longer term.

“Despite the unprecedented challenges facing the real estate industry, we believe Crescent’s underlying business model is solid, and our assets remain very attractive. We are encouraged that our lenders have agreed to provide additional funding to support our continued operations and allow us to maintain the high level of service and amenities our customers have come to expect. We intend to reach an agreement on our new capital structure and emerge from bankruptcy quickly,” Hede continued.“

On behalf of the Board and all the employees of Crescent, I would like to thank Art for his tremendous service to Crescent and the entire real estate industry over his long and successful career,” continued Mr. Hede. “He was instrumental in building Crescent into one of the leading real estate development companies in the country, and we are pleased that he will continue to serve as an advisor to the company.”

“Crescent Resources has the best assets and more importantly the most dedicated and passionate employees in the industry. I am confident that this restructuring will position the company better for the future,” said Mr. Fields. “It has been a privilege to work with such a talented team. I can move on secure in the knowledge that Crescent will build on its track record as one of the leaders in the real estate industry.”

As part of its Chapter 11 filing, the company is seeking Court approval to make certain payments and to maintain key agreements with employees, customers, vendors and partners of continuing operations to ensure the company can maintain its commitment to delivering a high level of amenities and services.

About Crescent Resources

Crescent Resources, LLC, is a land management and real estate development company with interests in 10 states in the southeastern and southwestern United States. Based in Charlotte, Crescent Resources is a joint venture between Duke Energy and Morgan Stanley Real Estate Fund. Established in 1969, Crescent creates mixed-use developments, award-winning country club communities, single-family neighborhoods, apartment and condominium communities, Class A office space, business and industrial parks and shopping centers. Visit www.crescent-resources.com for more information.

Read the complete announcement at the Crescent Resources website, June 10, 2009.

Tour the Flying D With Ted Turner

Want an opportunity to meet the top gun on The Land Report 100 on one of his many ranches? Now you can, thanks to a Montana fundraiser. Tickets to tour Ted Turner’s 119,000-acre Flying D Ranch are still available, and they’re going for $1,500. Proceeds go to the Greater Yellowstone Coalition; Turner is a board member.

Your $1,500 fee gets you a driving tour of the ranch from the nation’s largest landowner, cocktails on his back porch, and a dinner featuring ranch-raised bison. Turner has the world’s largest private herd of bison, which he raises on the Flying D and markets through his restaurant concept, Ted’s Montana Grill, with over 50 locations in 18 states.

At last report 10 of the 60 tickets remained.

Read more at:
“Enviro Group Plans Fundraiser at Turner Ranch,” Billings Gazette, June 5, 2009.

Madeleine Pickens Presents Eco-Sanctuary Plan to BLM

Madeleine Pickens is no ordinary horsewoman. A lifelong equestrian, she has led numerous champions into the winner’s circle, including the Hall of Fame Thoroughbred Cigar, winner of 16 consecutive races. Now she is championing a new cause: America’s wild horses.

“Wild horses are a living symbol of the pioneering spirit of Americans and the America West,” she says. Her goal is to establish a 501(c)(3) eco-sanctuary for all horses currently in holding facilities on BLM lands. Similar to a national park, it would be a tourist attraction as well as a refuge. To that end she has submitted a proposal to the Bureau of Land Management to create a public/private partnership that would not only locate appropriate land with sufficient forage and water sources but allow wild horses and burros to be free‐roaming and able to form natural bands.

“While the primary objective of the project is to care for these wonderful creatures, we will also be stewards of the land,” she says.

In March during hearings on H.R. 1018, Restoring Our American Mustangs (the ROAM Act), Pickens testified before the House of Representatives Subcommittee on National Parks, Forests and Public Lands Committee on Natural Resources. She has also submitted a plan to initially alleviate conditions for 10,000 wild horses currently being penned in BLM short-term holding facilities.

“My view is for a wild horse sanctuary that will be a tourist destination similar to our national parks where Americans and tourists from around the world can come, observe and be a part of this great part of American history. We can use this treasure to promote ecotourism and at the same time provide for permanent retirement and management of these American icons to which we owe so much,” she says.

To that end, she is urging those who cherish the wild mustang and support her initiative to contact Interior Secretary Ken Salazar to stop the slaughter and confinement America’s wild horses and burros.

To join the thousands who have already petitioned Secretary Salazar as well as read more about her plan, The Land Report encourages you to visit her website.

Interior Department Investigates Renewable Energy Speculators

Remember the Interior Department’s ongoing investigation into possible abuses of the Royalty-in-Kind program? Now the department’s Inspector General has started to look into possible abuses by companies seeking to develop renewable energies on BLM land.

Three years ago, BLM received six applications for solar energy projects. In the last year? 130, including one for 300,000 acres from Cogentrix Solar Investments.

The focus of the investigation is renewable energy companies as well as speculators that have applications pending for BLM leases and are seeking to be acquired based on the value of those applications.

According to the LA Times:

Officials said last week that the inspector general’s office of the Department of the Interior was investigating Tempe, Ariz.-based First Solar Inc.’s recent acquisition of Hayward, Calif.-based OptiSolar, and its unfinished renewable energy projects, for $400 million.The deal gave First Solar control of what the company described as OptiSolar’s “strategic land rights” to 136,000 acres of public land in San Bernardino, Riverside and Kern counties.

In acquiring OptiSolar, First Solar acquired the lease applications, not the land itself. Those applications are no guarantee according to Greg Miller of the BLM.

“There is no value associated with a mere application, which could be rejected by us for a variety of reasons,” Miller told the Times.

As a result, application approvals for solar energy projects have been suspended while officials sort out what’s going on.

Read more at:
“Renewable Energy Sparks a Probe of a Modern-Day Land Rush,” Los Angeles Times, June 1, 2009.

For Sale: 30-Acre Napa Valley Vineyard

Tired of some sommelier always offering overpriced vino? Think you could churn out a choice wine using your own grapes? Then what’s stopping you?

This 30-acre Napa Valley vineyard is all about the dirt . Jocelyne Monello of Heritage Sotheby’s International Realty has it listed for $6.9 million.

Almost all of the property is dedicated to grape growing. It also has a 2,400-square-foot aging building, a 5,200-square-foot outdoor work pad, and a 1,000-square-foot residence on the premises. Better yet, it already has an approved permit for a 100,000-gallon winery.

At $6.9 million, the property is a solid investment in itself. The current owner has a triple net lease that brings in $300,000 a year.

Remember, you  may not be able to direct films like Francis Ford Coppola, but at least you could try to make wine like him.