The Rich Home on the Range

Have your home on the range, access to a few thousand acres …without paying for it all!

By Candace Evans

Mark Lowham was raised on a ranch in Casper, Wyoming. He got away from roping steers and repairing fences to study at Stanford Business School. Lowham thought he might return to ranching one day, but he never dreamed that instead of roping steers, he’d be marketing ways to rope adults into a herd of conservation-minded land-owners.

Lowham is senior vice president of WEST*GROUP, where he works with Gerald T. Halpin, a former rocket scientist renowned for having the perfect nose for real estate deals. Halpin’s best to date, according to Lowham, was his 1962 acquisition of two dairy farms, Storm and Ulfelder, in the Washington suburbs. They became a significant part of Tyson’s Corner, now the 12th largest commercial business district in the United States. Tyson’s Corner, says Lowham, is larger than downtown Atlanta or Denver. WEST*GROUP, the company Halpin started in 1962 with partners Thomas F. Nicholson, Col. Rudolph G. Seeley and Charles B. Ewing, Jr. is the largest landowner in Tyson’s with more than thirty three city blocks still under Halpin’s sharp eye.

Though he launched in the greater Washington area, Halpin had seen the west in his extensive travels, and focused on the natural beauty of the Grand Tetons near Jackson Hole, Wyoming.

In 1989, WEST*GROUP formed a partnership called Meridian, whose mission was to develop a 1400 acre ranch in Jackson Hole, Wyoming, just minutes from the most perfect snow midway between the town of Jackson Hole and the Jackson Hole ski area.

The spread was initially zoned and approved for 1160 home sites but Halpin decided to turn what he called Indian Springs Ranch into a hybrid of private land ownership and common space sharing. Owners would hold title to a specific portion of the overall ranch – their homestead – and have access to the rest, much like a country club.

Those 1400 acres would only house 46 home sites of approximately seven acres each, enough really to be anyone’s Ponderosa. But you’d still get all the perks of ranch ownership: acres of protected ranch land, grazing cattle, horses to ride, barns, pool, tennis courts and a gathering lodge for community. The seven acre parcels of land on the ranch would be separated by several acres between homesteads, on which owners could build in their “envelope”.

This trend has been growing for a decade. Movies like the 1991 film “City Slickers” projected the romance of ranching into every movie theatre in America. Ted Turner and other significantly high net worth individuals began buying up huge land parcels in the west – Wyoming, Montana, and Colorado, “glamorizing” recreational ranch ownership. Halpin’s first vision for Indian Springs, circa 1989, was to have a small exclusive guest ranch on the order of Lost Creek Ranch & Spa, the exclusive Jackson Hole guest ranch run by Halpin’s son and daughter in law. Lost Creek is one of those places where city slickers can temporarily escape the city and play cowboy outdoors while dining indoors on lobster claw salad, Venison Rosini, and halibut stuffed with crab. Then they get to dunk boot-weary toes in the Jacuzzi after a hard day riding herd and fall asleep beneath the stars on Frette sheets.

Prominent people bought early sites: Connie Stevens, the actress; Carol and Robin Farkus, he the N.Y.C. Chairman of Alexanders Department Stores, Tom Bolger, chairman of Bell Atlantic. Buyers came from California, New York, the Midwest, the Minneapolis region. They attracted other well-heeled people, which helped sell out the homesites.

Meridian’s first venture was so profitable, Lowham led the company to develop a Texas Hill Country ranch in 1998; a new ranch in Mesquite, Nevada is currently in the works.

Though vacation home sales are now slower than they once were, they are not dead. The shared ownership ranch offers owners a shot at full home ownership while splitting the costs of the ranching operation as well as amenities. Some operations even eek out a small profit, but what these buyers are really looking for is a way to pay a fraction of the operating costs while enjoying the whole property. There’s a strong conservationist edge: most shared ownership ranches, like Indian Springs, its Texas Hill Country sibling, The Preserve at Walnut Springs (Ken Starr is an owner, as is yours truly), and Cross Pines Ranch Preserve in East Texas near Mineola, scatter a handful of homes across the vast acreage to create a true sense of isolation, leaving the majority of land to breathe.

“Ranchers are looking for a way to preserve land and conserve it while not going bankrupt,” says Dallas Addison, developer of Cross Pines, based on a conservation easement where each owner has a one-fortieth interest in the entire property. The conservation concept will soon be crossing the Pacific. Addison has partnered with fellow Texan Alan Friedman, owner of Trisept Inc., to develop Bosque Canyon Ranch at Lake Whitney in the Texas Hill Country, and a 7,000-acre project on Hawaii’s Big Island.

Other ranches cluster homesteads in one area to preserve as much raw open space as possible; the forever-open range becomes a prime selling point.

“Clustering is a much better land use process,” says Larry Corson, senior vice president with Dallas-based Hunt Realty Investments. Hunt is the developer of Cornerstone, a 6,000 acre ranch near Telluride, CO. “Our owners actually prefer it, knowing what they have preserved in perpetuity for the environment and wildlife.”

Cornerstone was once a plain Jane hunting ranch owned by Texans. It was foreclosed and sold at auction to a local investor. Corson literally spotted the site for his employer, Dallas oilman Ray Hunt, off a dirt road. After two years of working with local officials on the development plan, construction began in 2004. The property opened in 2006. Homesteads range from one to one hundred acres, starting prices at $175,000 to seven figures plus an $80,000 club initiation fee and $6,000 a year dues, which are fairly typical.

Perhaps helped by the relatively vibrant Texas economy, in 2008 the company reported $8 million in sales. The land Corson saw had full potential for a five-star plus ranch: horseback riding, an extensive trail system for hiking, riding or jeeping, fly fishing onsite and private access to the nearby Uncompahgre River, snow mobiles, cross-country skiing, snow shoeing, ice skating, toboggans, and downhill skiing at nearby Telluride in the winter months. But the best selling point of all was the art in every window – breathtaking views of the San Juan Mountain range from every angle.

It’s City Slickers roughing it on Gulfstreams.

Corson immediately saw potential for the one thing Telluride was sorely lacking: a high quality, private golf course. The spread held a natural plateau for what has become a world-class, Greg Norman-designed golf course. So there you have it – take a hike, go fish, study the migration patterns of deer and elk, saddle up for a Kamikaze ride, or golf.

The owners come from all over, but most are from Texas, like investment banker Richard Moses, who was in Telluride for all of 24 hours when he bought not one but two lots. In a tough market, says Corson, if people are going to make a real estate purchase it’s going to be a lifestyle decision: is this the place I really want to be? And of course, are there enough toys to keep me entertained for weeks?

“At Cornerstone, we once had a little bear cub one morning sitting on our outside barbecue licking the grease off the grill,” he says.

Just because it’s a ranch, doesn’t mean there must be cattle. At Cornerstone, management discovered that as soon as they stopped running cattle on the property, the songbirds returned – not a bad trade. The grazing killed off the shallow grassland savannah that the bison had once protected.

Sometimes the city slickers are more conservation conscious than the country folk, and more self-conscious and contentious. Owners at one shared-ownership ranch recently disagreed, albeit briefly, over the herd. Some owners thought keeping methane-producing Longhorns was not worth the massive carbon footprint, or hoof print, for 2,500 lbs of western eye candy. Of course, they were not as concerned over the carbon footprint etched by their private jet flights to the local FBO.

Shared ownership of course has its downside: you actually have to share – opinions, design, tastes and common areas. You may not have quite everything the way you would if the whole place was yours alone. Strong management, which can sometimes double as a counseling service, is essential.

“In this market,” says Corson, “buyers are really doing their homework to make sure the developer can deliver on all the promises.”

Or just keep peace at the ranch.

Candace Evans is the Editor of DallasDirt, a Dallas-based real estate blog for D Magazine Media Partners.