La Jara Reservoir transfer price: $43.5 million

Transferring ownership of La Jara Reservoir to federal management from the state of Colorado will come with a price tag of $43.5 million or $1,000 per acre, according to an appraisal completed by Chandler Consulting of Grand Junction.

The Colorado State Land Board is expected to take up the appraisal at its meeting in January. It commissioned the appraisal in anticipation of transferring ownership to the U.S. Forest Service and U.S. Bureau of Land Management. Colorado Parks & Wildlife will also get a slice of the 45,650-acre pie.

UPDATE: Where would the $43.5 from the land transfer go?

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Chandler Consulting based its appraisal on eight comparable sales it identified in neighboring New Mexico and southern Colorado. Those comparables ranged from the sale of Cielo Vista Ranch in Costilla County to Canon Blanco Ranch in Sante Fe. See below for all eight comparables used in the evaluation.

“The purpose of this appraisal is to provide an opinion of market value for the fee simple estate in the appraised property, subject to the outstanding rights of record (but no proposed reservations). Property rights to be acquired include the land, mineral estate (all owned except for 190 acres), and existing building improvements (although none have contributory value), but no water rights. The intended use of the appraisal is to provide the basis for the offer of the voluntary acquisition of the entire 43,525.79-acre property by the United States of America (USA) from current owners,” Chandler Consulting said in its 95-page appraisal report.

The Rio Grande National Forest has been working with BLM and Colorado Parks & Wildlife to gain ownership of the public lands. For more on that read Public land at La Jara Reservoir gets summer appraisal to move sale ahead.

Through the sale, the U.S. Forest Service will acquire the western 21,821.28 acres, while the Bureau of Land Management will acquire the other eastern 21,704.51 acres for a total of 43,525 acres. The remaining 2,124 acres will be conveyed to Colorado Parks and Wildlife (CPW).

The federal agencies involved have been securing funding through budget appropriations and other federal money available through the U.S. Department of Interior’s Land and Water Conservation Fund. The Bureau of Land Management is an agency within the U.S. Interior while the Forest Service is part of the U.S. Department of Agriculture.

“The forest service and BLM have a vision of it continuing to be public use and serve in particular our local communities that have grown up using that land to hunt, and graze cattle, and recreate,” said Andrea Jones, the Rio Grande National Forest district ranger in Conejos County, in an interview this summer.

The State Land Board had been approached at times about selling the public lands to private developers to build out but agreed that it would only transfer the property to federal management and Colorado Parks & Wildlife.

“They only approved exploring a transaction with an entity whose mission is directly aligned with supporting public access, community use, and permanent protection/conservation of natural and cultural resources in La Jara,” Kristen Kemp, the State Land Board communications officer, told The Citizen this summer.

COMPARABLE LAND SALES

A summary of foregoing adjustments made to each comparable, and resulting indication of market value for the entire subject property (on the basis of price per deeded acre), is discussed as follows:

Sale One is Canon Blanco Ranch, a 62,395-acre holding that is situated along U.S. Highway 285 and southeast of Sante Fe, New Mexico. It sold during June 2023 for $60 million, which equates to $906 per acre after $3.5 million is deducted for the contributory value of existing improvements. By direct comparison to the subject, downward adjustment for somewhat superior access is offset by upward adjustments for slightly inferior adjacent land uses as well as natural features. This sale is comparable in other regards, and indicates a value for the subject that is similar to $906 per acre.

Sale Two is Laughlin Peak Ranch, which is located south of Raton in Colfax County, New Mexico. This 28,227-acre property was purchased in March 2023 for $44.3 million, with an adjusted price for land only of $1,527 per acre after $700,000 is deducted for improvements, as well as $500,000 for free grazing rights. By direct comparison to the subject, downward adjustments for somewhat superior access, as well as slightly superior natural features, are partially countered by an upward adjustment for slightly inferior adjacent land uses. This comparable is otherwise deemed similar to the subject property, and supports a value that would be somewhat lower than $1,527 per acre.

Sale Three is Broken Butt Ranch, a 16,303-acre holding at the junction of U.S. Highways 64 and 84, west of Chama, New Mexico. It was purchased in January 2021 for $24.5 million, which equates to $1,488 per acre after $220,000 is subtracted for the contributory value of older improvements. By direct comparison to the subject, downward adjustments for somewhat superior access as well as smaller size are partially offset by an upward adjustment for slightly inferior adjacent land uses. It is comparable in other regards, and supports a value that is somewhat less than $1,488 per acre.

Sale Four is Citadel Ranch, which is located on the northside of U.S. Highway 160, near La Veta within Huerfano County, Colorado. This 15,000-acre holding was acquired by two separate buyers in January 2021 for total consideration of $23.5 million, with a land only price of $1,400 per acre after $2.5 million is deducted for existing improvements. The seller bought the ranch in September 2017 for almost the same price of $23.7 million, despite investing about $1.5 million for renovations. By direct comparison to the subject, downward adjustments for somewhat superior access, as well as smaller size, are partially offset by an upward adjustment for slightly inferior adjacent land uses. This sale is similar in other regards, and indicates a somewhat lower value than $1,400 per acre.

Sale Five is Crazy French Ranch, a 19,200-acre holding near Trinidad along the east side of I-25, in Las Animas County, Colorado (at the New Mexico state line). It was purchased by TNC and TPL during February 2019 at an arms-length price of $25.4 million, with the land worth $1,302 per acre after $450,000 is subtracted for older buildings. The holding was resold to CPW in April 2020 at a bargain sale price of $19.5 million for current use as Fisher Peak State Park. By direct comparison to the subject, downward adjustments for somewhat superior access and slightly smaller size are mostly offset by upward adjustments for slightly improving market conditions as well as inferior adjacent uses. It supports a somewhat lower value for the subject property than $1,302 per acre.

Sale Six is Wolf Springs Ranch North and Boyer Ranch, which is located south of Westcliffe on State Highway 69, in Huerfano and Custer Counties. Navajo Nation assembled this 27,759-acre ranch from two buyers in late 2017 for $30.5 million, which equates to $822 per acre for land only. By direct comparison to the subject, upward adjustments for some appreciation over time, as well as slightly inferior adjacent land uses, are partially offset by downward adjustment for somewhat superior access. This sale indicates a slightly higher value for the subject than $822 per acre.

Sale Seven is Wolf Springs Ranch South, a 38,070-acre holding that adjoins Sale Six to the south, within Huerfano County, Colorado. It was purchased during September 2017 for $30.7 million, which equates to $785 per acre for land only after $870,000 is subtracted for older improvements. By direct comparison to the subject, upward adjustments for some appreciation since closing, and slightly inferior adjacent land uses, are partially offset by a downward adjustment for somewhat superior access. This comparable supports a subject value that is slightly more than $785 per acre.

Sale Eight is Cielo Vista Ranch, which is located 45 miles southeast of Alamosa in Costilla County, Colorado. This 83,368-acre holding sold in August 2017 for $67.5 million, with land only price of $799 per acre after $850,000 is deducted for older buildings and equipment. By direct comparison to the subject, upward adjustments for slightly inferior property rights conveyed, somewhat better market conditions since closing, as well as slightly inferior adjacent land uses, are partially offset by downward adjustment for somewhat superior access as well as slightly superior natural features. It is otherwise similar, and indicates a slightly higher value for the subject than $799 per acre.