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.
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.
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.
“With an incredible abundance of trout, birds and game, the Running Colter Ranch represents the finest spring creek trout fishing, waterfowl and upland bird hunting in Montana. The availability of private scenic building sites, agricultural and conservation potential, Running Colter presents an opportunity that is not to be missed.” – Live Water Properties’ Montana Managing Broker and longtime resident of Bozeman, Craig Janssen.
Located in Belgrade, Montana, Running Colter Ranch presents a rare opportunity to own one of the finest spring creek trout fishing, waterfowl and upland bird hunting properties in Montana. Comprised of two separate parcels totaling 696± acres, this ranch features 3/4 mile of excellent spring creek fishing on Bull Run Creek or “cast and blast” the private waterfowl ponds and sloughs. Additionally, virtually all of the waterways on the property have been expertly enhanced to maximize an incoming owner’s outdoor recreation; the wetlands and creeks on the property are enrolled in an enhancement mitigation bank (check with the listing broker for full details).
Present ownership has managed Running Colter primarily to promote wildlife habitat and property health. A neighboring rancher currently leases the crop and hay grounds for production. To maximize the game bird and wildlife habitat, no grazing has been utilized. Running Colter has ample water to irrigate the 264 acres that are currently being farmed, with a diversity of sources within the irrigation rights. This property is extremely well watered for agricultural purposes with the benefits of increased quality in the wildlife habitat.
Running Colter Ranch is home to an incredible diversity of game and non-game birds, along with plentiful wildlife. Whitetail deer, pheasants and many types of waterfowl are found in abundance. Hungarian Partridge, dove, moose and black bear are not uncommon. The number and variety of songbirds that can be seen at the bird feeders off the back porch are incredible.
The hunting dogs will be eager to work for game birds along the many water features of Running Colter Ranch. The waters of Bull Run Creek have been enhanced for both trout and waterfowl. The grain fields lining the creek allow for excellent feed and cover close to the water sources. Bull Run Creek is one of the hidden angling gems in the Gallatin Valley, offering great spring creek opportunities for the fly fisherman. The springs and water expressions provide the warm groundwater needed to allow for cold weather waterfowl opportunities.
Running Colter Ranch is being offered for sale in its entirety for $6,475,000, with the potential to purchase either of the two smaller parcels listed below, by Live Water Properties.
Northern Parcel (Lot 1): 252± acres for $3,000,000
Southern Parcel (Lot 2): 441± acres for $3,750,000
For more information on Running Colter Ranch, contact Live Water Properties at (866) 734-6100 or firstname.lastname@example.org. You may also contact the brokers directly: Craig Janssen at (406) 580-5830 and Jack McInerney at (406) 220-1696.
Located northwest of Eddyville, this well-maintained quality pastureland sits in the heart of Middle America and has been carefully managed by the Peterman family for over half a century. Four windmill wells, two cisterns, a dam, and several dugouts nurture livestock and abundant wildlife. Other improvements include corrals and half a mile of brand new five-wire fence. The 893.6 acres will be auctioned on September 10 in Eddyville by Marshall Land Broker & Auctioneers of Kearney.
Read more here.
Click here to download a copy of the August 2012 newsletter.
From showings to impending sales and upcoming auctions, brokers from across the country are on the land, making the most of heightened investor interest, solid buying opportunities, and record-low borrowing rates. We touch on many of these topics in our August newsletter, which features timely updates on several key sales involving Nebraska pastureland, Wyoming cattle country, and not one but two Florida equestrian properties.
Every day at 6:45 am, William S. Haines Jr. makes his daily rounds at Hog Wallow. Why? To check in on the 1,300 acres of sprawling cranberry bogs and reservoirs, which are expected to produce 300,000 100-pound barrels of cranberries this year.
Haines, 59, is a fourth-generation farmer who grew up on what is now a 14,000 acre farm that his great-grandfather started in 1890. As owner and CEO of Pine Island Cranberry Company, Haines oversees the largest cranberry operation in New Jersey and one of the top five in the country.
Much of Haines’ success comes from heeding the lessons of his elders, including those pertaining to the importance of water in any farming operation. When asked why cranberries thrive here, Haines’ answer is simple: “abundant, clean water and acidic soil.” Recalls Haines of advice from his father, “Before you make any decision, ask, ‘Where does the water come from and where do you want it to go?’”
Named New Jersey’s outstanding forest steward by the state Department of Environmental Protection for the management of his woodlands on the Wading and Oswego Rivers, Haines recognizes the interdependent relationship between the farm and the forest – one whose long-term health depends on regular thinning and controlled burns.
Admired by fellow cranberry farmers for his work ethic, Stephen Lee, president of Lee Brothers Inc., commented that Haines is “very intense, hands-on and knowledgeable about whatever he’s going to do. He learns about it and does a first class job.”
Considered to be one of the country’s best forest stewards and a leader in forest management, Haines has long been committed to the land, including helping to expand Burlington County’s Farmland and Open Space Preservation programs and to create a Parks Department, which has preserved over 1,000 acres and developed six parks in the county.
Read more here.
Photo Credit: Pine Island Cranberry Company, Inc.
White-hot farmland values in the Heartland show no signs of cooling off. –The Editors
The Chicago Fed reports that agricultural land values in the five-state district jumped 19 percent higher in the first quarter of 2012 compared with the first quarter of 2011. Leading the pack? The Hawkeye State. Farmland values in Iowa showed a 27 percent year-over-year increase.
“The momentum for rising farmland values was generated by higher commodity prices and net farm incomes last year.”
“Bidding among farmers was common at farmland auctions, driving up winning bids.”
“Forty percent of the survey respondents observed a higher share of land purchased by farmers versus investors, while 7 percent observed a lower share, in the period from October 2011 through March 2012.”
“… the number of farms sold, acreage sold, and the amount of farmland for sale over the winter and early spring rose more sharply than a year ago.”
“A third of the responding bankers expected farmland values to increase during the April through June period, while 1 percent expected declines. Nearly two-thirds of the respondents looked for farmland values to stabilize.”
Read the complete report at www.ChicagoFed.org.
Download the digital version of The Land Report’s Summer 2012 edition here.
Be sure to check out ways to improve your waters courtesy of the Summer issue of The Magazine of the American Landowner. Mike Sprague at Trout Headwaters shares a variety of different ways to use water to add beauty – and value – to your property, and many of the improvements he suggests are low cost or no cost. Read more HERE.