Fountain Investments Buys 1.3M Acres of Nevada Land for $31M
- Dec 09, 2011
December 9, 2011
By Nicholas Ziegler, News Editor
CBRE Group, Inc. has completed of one of the largest land sales, by acreage, in U.S. history with the sale of 1.28 million acres of land and minerals in Nevada. The land, which stretches from Reno to the Utah border along I-80, was purchased by Florida-based Fountain Investments– which is owned by M.C. Davis and Heath Rushing – for $31 million. Pico Holdings Inc., a La Jolla, Calif.-based public company, was the seller.
Pico Holdings had owned the property for 15 years. Of the 1.2 million acres involved in the transaction, 483,000 acres, encompassing 750 square miles, were purchased outright as fee-simple land. Fountain Investments purchased mineral rights for the other 800,000 acres and recently hired Don Pattalock, formerly of Pico Holdings, to serve as the President of New Nevada Resources, a new entity formed to oversee the mineral rights.
The majority of Nevada’s 110,567 square miles – approximately 85 percent – is either tribal or owned by the federal and state governments, with just 15 percent of the state’s total land area being privately owned. The total of this transaction represents slightly more than 12 percent of the privately owned land in Nevada, and equates roughly to the size of Rhode Island, according to Steve Lehr, senior managing director with CBRE’s Land Services Group, which represented Pico.
“A land sale for more than $30 million is very significant today,” Lehr said. “The good news is that values have appeared to stabilize.” Lehr also noteed that while a handful of land deals have traded at prices between $50 and $115 million, most of those involved far less acreage than this transaction. “
This is the third major land sale completed by Lehr and CBRE’s land services group since 2009. The group sold the high profile, 13,000-acre Yellowstone Club resort in 2009 in conjunction with CBRE’s golf services Group and last year, completed the 7,000-acre sale of Festival Ranch in Phoenix, which is entitled for 14,000 homes and five golf courses.
“The recent sale in Nevada represents a trend of investors seeking hard assets in the U.S. and as hedges against inflation,” Lehr said.