It’s amazing – the yarns that can be shared about certain tracts of real property. Our April Newsletter takes a closer at several standout stories, including one that I am quite confident is destined to end up before the Supreme Court in a year or two. Why? The two states involved have been disputing their boundary for only the last 195 years.
Also in our April Newsletter you’ll find the story of an Oregon Senator who is considering a shift in federal management of certain timberlands. Meanwhile the Texas Legislature is currently embroiled in how best to combat the drought that has plagued much of the Lone Star State.
Last but not least, an uptick in the housing market has brought renewed activity to North American forests. Learn more as one of America’s largest landowners gears up for increased lumber sales.
Page through each issue of The Land Report in 2012, and three trends stand out:
1) Legacy properties continue to command a premium. Witness Larry Ellison’s mega-million-dollar purchase of the island of Lanai.
2) The market continues to crave income-producing properties, especially productive farmland.
3) America’s leading landowners view stewardship as a critical element of their trust. Witness Louis Moore Bacon’s remarkable conservation gift, which led to the creation of the Sangre de Cristo Conservation Area.
One transaction encompassed all three of these elements: the sale of Montana’s historic Broken O Ranch. The history of the Broken O predates statehood. Its legacy is peerless. And its capacity to produce cattle and prodigious amounts of grain is matchless. When these 124,000 acres changed hands in November, one passionate, innovative business- man assumed an imposing mantle that had been meticulously crafted by a peer from an earlier era. For these and so many other reasons, the Magazine of the American Landowner is proud to designate the sale of the Broken O as the 2012 Deal of the Year.
Located along a 20-mile stretch of the Sun River, the roots of the Broken O reach deep — to the days of the Montana Territory. Its current incarnation was masterminded by Bill Moore, founder of the country’s largest privately owned paint company, Kelly-Moore. What began in the 1980s with Moore’s acquisition of a single ranch property along the Sun River evolved into what Forbes described as “one of the largest agricultural operations in the Rocky Mountain West.”
The Broken O’s new owner — Stan Kroenke — is no stranger to the land either. Kroenke ranked No. 10 on the 2012 Land Report 100; among his other ranch holdings is the largest contiguous ranch in the Rocky Mountains, the 540,000-acre Q Creek Ranch.
“Stan looks for quality,” says Kroenke’s broker, Joel Leadbetter of Hall and Hall. “The Broken O is so diversified with agricultural and recreational opportunities, and it’s such a large continuous landscape. That’s rare these days. The Broken O also complements and enhances the attributes of Stan’s other ranches and their operations.”
The rich and alluring history of the Broken O Ranch dates back to the 1800s, a time when cattlemen of the Lonesome Dove era ventured west to tame vast sprawling landscapes. One of those intrepid hopefuls was Daniel Flowerree, a Missourian who made his fortune in Montana’s gold fields. After settling in the Sun River Valley, his Flowerree and Lowry Cattle Company boomed, running as many as 40,000 head. Then a series of brutal winters took a bitter toll.
Shortly after the turn of the twentieth century, Flowerree’s ranch was acquired by the Teton Land Company. In the decades that followed, the operation eventually grew into one of the largest cattle operations in the West. In 1945, John Hamilton of Hamilton Beach appliances purchased it.
Bill and Desiree Moore bought the Hamilton Ranch in 1988. One of Moore’s next acquisitions was a neighboring tract, the Freeman Ranch. He would forge a deep, long-lasting bond with the family. Dan Freeman became a close friend and Bill’s right-hand man.
Over the ensuing two-decade span, Bill Moore and Dan Freeman worked in concert, assembling more than 20 blocks of land and building the enormously successful ranching and agricultural enterprise that is in place today.
“As his ranch manager for more than 20 years, Dan brought Bill’s dreams and his passions to fruition. It was a rare combination,” says Mike Swan, the seller’s broker. Swan, who was affiliated with the leading firm of Bates Sanders Swan Land Company throughout the marketing and sale of the Broken O, announced the formation of Swan Land Company in February 2013.
The Broken O is its own hedge fund,” Swan says. “Production is at such a massive scale that any one of the individual entities could make a tremendous agricultural operation independently.”
In addition, the Broken O features a matchless recreational component. Twenty miles of Sun River create an immense resource not only for fish but also for waterfowl, upland birds, mule deer, and elk. Thanks to the Sun River and other historic rights that date back more than a century, the Broken O is the largest private water rights owner in the State of Montana.
The ranch also enjoys close proximity to “the Bob.” At more than 1.5 million acres, the renowned Bob Marshall Wilderness is one of the largest wilderness areas in the Lower 48.
Along with building an agricultural empire, Moore also built a reputation as a steward of the land. He improved the ranch’s extensive pastures by planting native grasses. Moore placed three conservation easements on approximately 9,700 acres along the Sun River corridor. The Moores eventually became a mainstay of the community, employing a large number of locals, funding a community center in nearby Augusta, and donating to local schools and charities.
Kroenke is also no stranger to land stewardship. “Stan bought his first ranch in 1997, and balance has always been important to him,” Leadbetter says. “He looks at everything: the business, ecosystem, fishery, wildlife, and landscape. He always strives to be a very good steward while running sustainable ag operations.”
A deal of this size requires a tremendous amount of preparation. Swan spent months working with Freeman and the seller’s legal team to prepare volumes of due diligence material, including inventory lists, equipment and cattle documentation, background information on 27 houses, soil reports, land title commitments in three counties, information about water rights, state and federal land leases, grazing permits, gravel permits, DEQ permits, conservation easements, and hunting leases, to name a few.
“The preparation was instrumental to the successful transaction,” Swan says. “Our goal was to package the ranch to the point that when the buyer came through the door, everything they needed to know about the Broken O was at their fingertips.”
And interested buyers did come knocking, including private investors and investment funds as well as corporate entities.
As luck would have it, Leadbetter and Swan are both based out of Bozeman; the two know each other quite well. “We both grew up on ranches in Southwest Montana and have ag backgrounds,” Swan says. “We were working with a buyer and a team that understood the materials we provided and spoke the same language. That was paramount to the transaction.”
Of equal importance was that Leadbetter’s client instantly recognized the sterling qualities of the Broken O. “Stan looked it over, and he knew he wanted it,” Leadbetter says. “He’s that kind of guy — very bright — and wants to continue that legacy of innovative agriculture and enjoy the wildlife and fishing and all that the Broken O has to offer.”
An especially rewarding aspect only became apparent after the closing. The central character was not present, but his legacy continues. “It is a blessing we were able to sell the ranch to an individual of Stan Kroenke’s commitment to agriculture and land stewardship. My sense is that this transition will not only see a continued commitment to the current agricultural operation that William Moore established, but a continual enhancement and improvement of the ranch overall. I’m sure if Bill Moore were alive today, he would be pleased.” Swan says.
Enjoy the entire issue HERE.
Spring is off to a strong start, and this month’s Newsletter has the data to prove it. I spoke with Scott Shuman at Hall and Hall Auctions about the $4 million sale of more than 2,000 acres just outside of Dallas on March 7. His words to me? “If anyone needs any proof that there’s a ton of money sitting on the sidelines looking for a solid investment opportunity, this sale proves it.” Turn to page 3 for more on the TRBP Ranch auction, which was offered by Hall and Hall Auctions in conjunction with Hortenstine Ranch Company.
There is a strong emphasis on federal policy in our March Newsletter. In addition to an update on last year’s record crop insurance payouts, which now total a staggering $15 billion, landowners may want to take a closer look at possible grants currently available from the Natural Resources Conservation Service.
Getting Asia’s largest beef importer to ease restrictions on American cattle. In 2003, the Land of the Rising Sun closed the door on all U.S. beef following the discovery of a single instance of bovine spongiform encephalopathy (BSE) in Washington State. It took a decade but the Japanese Ministry of Agriculture, Forestry and Fisheries has relented and is allowing more U.S. beef to be exported to Japan.
Our February newsletter features more details on this crucial news that will positively impact landowners, cattlemen, and beef companies nationwide. Also available is a link to the Agreement itself.
January 15, 2013 by Land Report Editors
Filed under Agriculture, Auctions, Cattle, Farming, Federal Policy, Georgia, Minerals, New Mexico, Newsletter, Oklahoma, Public Land, Recreation, Residential Property, South, Southwest, Texas
Secretary of the Interior Ken Salazar announces his plan to leave Washington and return home to Colorado. The Supreme Court agrees to hear a dispute between Texas and Oklahoma over water rights. And the State of Texas, on a completely different matter, asks the Nation’s highest court to intervene in yet another water fight, one that involves Texas and another neighbor, New Mexico.
So much for a slow start to 2013. Our January newsletter features these news items and as well as others, including Land Report 100er Louis Bacon’s timeless gift to establish the Sangre de Cristo Conservation Area in Southern Colorado.
December 15, 2012 by Land Report Editors
Filed under Agriculture, Auctions, Back Issues, Cattle, Conservation, Dogs, Federal Policy, Great Lakes, Great Plains, Midwest, Northeast, Pacific, Public Land, Recreation, South, Southwest, West
Travel to Sonoma County and enjoy a rare and revealing portrait of John Jordan and his family’s renowned vineyard and winery. Learn the latest about the white hot market for Midwest farmland. Or follow the twists and turns of the Yellowstone River as it winds its way onto your iPad courtesy of the new documentary Where the Yellowstone Goes, sponsored by Trout Headwaters.
All these and many more stories So be our guest and enjoy our latest issue HERE.
For more up to the minute reports on listings, auctions, sales, and breaking news pertaining to land and landowners, be sure to follow The Magazine of the American Landowner on Facebook, Twitter, and Pinterest.
The 124,000-acre Broken O Ranch, one of the most expansive and versatile agricultural operations in the Rocky Mountain West, has been purchased by American business entrepreneur Stan Kroenke. The Moore family has spent nearly 25 years assembling this massive land holding. Spread across Lewis & Clark, Cascade and Teton Counties along the Sun River near Augusta, Montana, the Broken O was carefully shaped and improved to create one of the most grand and significant agricultural enterprises in the United States.
— Sam Connolly, Kroenke Ranches
Kroenke, a respected land steward, also owns Cedar Creek Ranch and PV Ranch both located in Montana, and ranches in Wyoming, Arizona and British Columbia. Terms of the sale were not disclosed. Mike Swan of Bates Sanders Swan Land Company represented the Sellers and Joel Leadbetter of Hall and Hall represented the Buyer in this landmark transaction.
Situated along the eastern edge of the stunning Rocky Mountain Front – the Broken O is one of the West’s most grand and significant ranches. More than 20 miles of the Sun River course through the heart of the substantial Broken O Ranch offering abundant recreational and hunting amenities.
The Broken O currently irrigates in excess of 13,000 acres, the largest acreage of irrigated farm land in Montana. The Ranch runs 3,500 mother cows, 800 replacement heifers and 175 range bulls. It produces 25,000 tons of alfalfa hay and 700,000 bushels of small-grain crops annually. It also contains a 5,000 head commercial feedlot.
For more information on the Broken O Ranch, visit TheBrokenORanch.com.
Productive ag land sets a new auction high.
A major bump in U.S. hunting and fishing numbers.
These are a few of the featured items in our October 2012 newsletter, which is now available HERE.
From coast to coast, interest in land and land-based assets continues to rise. See so for yourself as we present new listings, new sales data, and auction updates.
H20. It’s the lifeblood of your land. No other feature rivals this resource for enhancing habitat, nurturing biodiversity, and bringing beauty (and value) to your property.
Stand in the middle of Montana’s Running Colter Ranch and perk up your ears. If you listen closely, you’ll hear the sweet summer melody of Western songbirds, the rude quacking of a duck, and maybe even the honk of an occasional Canadian goose. Listen more closely, and I promise that you can pick out the swishing sound of big bunches of native grasses catching the wind and bending in the breeze.
These are exactly the sorts of sounds one would expect to hear on a ranch in Montana, right? But on the Running Colter Ranch, they mean much more. They mean the plan is working. Just five short years ago, this ranch was a dried-up stretch of ranchland. Deep cracks in the dirt revealed rusty pipes. The wetlands that once existed had long since been filled in. Brown grass spread out as far as the eye could see — brown grass that is now lush, green, and full of wildlife.
The reason? The sound that is hardest to hear: the sound of running water.
It’s a prime example of revival, restoration, and dedication, and it all revolves around water. “Water plays that central role in the biodiversity of our resources, our private property, and our environment,” says Mike Sprague, founder of Montana-based Trout Headwaters, Inc. (THI).
“Water is the key to life” is Sprague’s motto, and he should know. Throughout his career he’s worked with water. Sprague founded THI in 1995 using state of the art technology and scientific practices to help landowners across the U.S. restore and protect the wetlands and water systems coursing through their properties.
And the results of his work — whether it be a current 100,000-acre project featuring three watershed systems in the Rocky Mountains or a 100-acre parcel on the East Coast — have been no less than inspiring.
Sprague has observed a compelling phenomenon that occurs once a landowner restores waters to their purest forms. As a result of this effort, every aspect of the land — from the economic value to the aesthetic elements and everything in between — is enhanced. Healthy, happy waters bring nature back in balance. They provide an alluring habitat for native birds and migratory waterfowl. All species of wildlife flourish, including pesky varmints.
Rejuvenating a watershed increases productivity for farming and ranching. It creates superior recreational opportunities and viewsheds. And it strengthens the relationship that owners have with their land. There’s also the future factor, leaving the land better off for future generations.
Consider the 700-acre functional farmlands of the Running Colter. Lands such as these, with a century of agriculture use, were impacted with human-caused issues revolving around farming, development, infrastructure, and mismanagement. This can include improper grazing techniques, pesticide use, and wetland disruption.
It wasn’t that the previous landowners purposely meant to do any harm; more than likely they were adhering to the ag procedures of their day. The ranch’s previous owners had no intention of causing longlasting harm to the land.
Examples of this on the Running Colter included filling in wetlands and diverting streams underground. These practices allowed for more agricultural water in the short term, but much less in the long run— to the point where the native landscape slowly dried up. Native plants were supplanted by noxious weeds. Wildlife sought more fertile forage. Last but not least, farming yields eventually diminished.
After decades of decay, the Running Colter Ranch was acquired by a private conservation fund in 2008. Sprague’s team at THI was put in charge of restoring the wetlands and stream systems.
“At first, it was difficult to imagine what the water here could become,” Sprague says. “The bulk was wetland more than 80 years ago. Now it was in pipes, and the wetland areas were filled. The land had become increasingly drier.”
Sprague’s team dug in, literally, and spent a year re-elevating groundwater to restore streams and shallow wetlands. Then they created a management plan that involved leaving much of the landscape to heal up naturally.
Five years later, the barren landscape is a thriving wetland habitat. “You almost can’t believe you’re standing on the same property,” Sprague says.
Sprague appreciates the resurgent ecosystems firsthand. Since revitalizing the ranch’s waters, he has fly-fished and hunted the Running Colter many times. “We’ve also reestablished valuable irrigation for farming and recreational activities,” he adds.
So what lessons can be drawn from the Running Colter Ranch restoration project? What are the implications for other landowners around the country?
According to Sprague, there are many. And they begin with a simple understanding, one that concerns the disconnect between our water needs and our water sources.
“For most of us, we tend to think of water in a very utilitarian way,” Sprague says. “After all, the vast majority of the planet is covered by water, but a very small percentage is useful to us.
Sprague explains that there is a perception that the water running through our land is all fine and dandy. In many cases, especially when landowners have bought properties once primarily used for agriculture, that’s not altogether accurate.
When a landowner acquires a property with this kind of history, he or she faces problems that involve the deterioration of watersheds, an extremely common yet unintentional byproduct of historical agricultural practices. When a watershed deteriorates, so do many other living things around it. Some of this damage can go unnoticed at first. After all, if there is no visible debris in a streambed or a drainpipe dumping toxic waste into a river, the damage can be hard to detect for the untrained eye.
It’s also difficult for the untrained eye to imagine the impact of better waters. Biodiversity allows countless elements to thrive. Even if water-rich landowners are uninterested in using this asset for economic purposes, such as farming or ranching, most still want to protect the potential economic, aesthetic, and recreational values. “It becomes a question of managing that small finite resource,”
But how does one go about assessing the damage and then fixing it? Although it sounds daunting, according to Sprague it doesn’t have to be. “Oftentimes the problems can be dealt with in a very cost-effective way,” he says. “Restoration can be done passively or actively, and both ways can have very successful outcomes.”
To identify the disturbances, THI completes an initial consultation at no cost to the landowner. Then they come up with a plan that allows landowners to put projects into phases and take various approaches given the issues identified.
Most improvements fall into one of three basic budget categories. The fastest (and most costly) is a full-on water reclamation project such as the one implemented at the Running Colter. Depending on the size and issues, this can include a year or more of hands-on work with equipment and personnel on the ground followed by extensive monitoring. A middle ground, involving a partial reclamation project, involves consultants mapping out a plan and then letting a landowner implement it.
The slowest but most cost-effective route is a holistic approach based on improving what is already in place as well as future monitoring. “A project can be as simple as marking off the disturbed area, and allowing nature to heal itself, which it does very well when left to do so,” Sprague says.
No matter the approach a landowner decides on to improve his or her waters, the end results are well worth the time, effort, and investment. A landowner now has developed an intimate knowledge and connection with his land, has increased the value and the recreational usage, and has left it better off than when he first came to own it, for future generations as well as neighbors downstream.
“Water is such a centerpiece of so many properties, and it’s all connected,” Sprague says. Then, a serious expression on his face, he adds an all-important closing comment. “It’s incumbent on each one who owns the banks of a stream to keep the water quality up to its purest form. That land and that water are going to be there long after we are gone, and we have the ability to pass that forward in better condition than we found it.”
Corinne Garcia freelances for Marie Claire and Country Living. Based in Bozeman, her speciality is penning stories about Big Sky Country.
Download the digital version of The Land Report’s Summer 2012 magazine.
The value of patience was clearly evident in a recent transaction involving the sale of a 5,200-acre ranch near Hall, Montana. Fay Ranches represented the seller; a buyer came directly to us and we quickly had an offer on the table the first week of December for a cash closing before the end of the year.
It needs to be mentioned that our seller grew up on this ranch. It was his father’s place, and there was a strong emotional tie intact. As the reality of the looming sale set in, it turned out that our seller was not quite ready to let go.
As in most transactions these days, price was the biggest hurdle. The buyer was “all in” and pushing for a deal. The seller was not. We asked the buyer to give the seller the time needed to come to terms with the sale of his family’s ranch. We also encouraged both buyer and seller to stay engaged, and each obliged, taking small steps toward common ground. After six months of negotiations, they finally agreed to a price in May. During that time, we reached a stalemate on several occasions. At one point, there was no correspondence between the two parties for nearly a month. Even though it sometimes felt like this transaction would never come together, our team at Fay never gave up. Perseverance prevailed, and we successfully closed the deal in July.
“The strongest of all warriors are these two — time and patience.” - Leo Tolstoy, War and Peace
The buyer is now looking forward to autumn on his new ranch, especially the prospect of elk hunting in Montana. The seller is actively searching for a 1031 exchange property in Texas where he will spend more time with family. Each is now ready to start new chapters of their lives.