TEXAS’ WAGGONER RANCH OFFICIALLY CHANGES HANDS
TEXAS’ WAGGONER RANCH OFFICIALLY CHANGES HANDS
WRITTEN BY TOM ALEXANDER • PUBLISHER
When Judge Dan Mike Bird of the 46th Judicial Court approved the sale of the 535,000-acre Waggoner Ranch on February 9, 2016, news traveled around the globe. After all, the largest ranch in the United States under one fence was about to leave family hands for the first time since W.T. “Tom” Waggoner founded it in 1849. And the new owner was a Stan Kroenke, an American businessman, professional sports team owner, and rancher who had already amassed one of the largest ranching conglomerates in North America. The media frenzy created the illusion the transaction was complete.
I, knowing that a land deal especially a deal of this magnitude and complexity isn’t done until all of the signatures are on all of the appropriate lines, called Sam Middleton to congratulate him on nearing the finish line and to determine whether he had an estimated time of arrival at the aforementioned destination. Sam, who owns and operates Chas. S. Middleton & Son in Lubbock, was one of the two ranch brokers appointed to manage the ranch’s sale on behalf of the family and shareholders. The other broker was Bernard “Bernie” Uechtritz, an international real estate advisor to Briggs Freeman Sotheby’s International Realty in Dallas.
Frankly, I didn’t expect Sam to answer his phone. He was in the middle of a big deal and a big story. Of course, he is also Sam—a consummate professional. He picked up on the second ring. After exchanging a few verbal high fives, we agreed to touch base again when the deal was drawing to a close and Bernie could join us.
That opportunity arose later that day as a gaggle of lawyers and advisors were hard at work at the six courthouses in the six Panhandle counties that include a portion of the sprawling Waggoner. We were scheduled to talk at 9:00 a.m. My phone rang an hour later. Despite the best efforts of Christy Payne of Uechtritz's, International Icon Properties, who was assisting the duo, the media storm and unfolding events had upended Bernie and Sam’s schedules. When we made a connection, the tone was optimistic and celebratory.
“I’d like to be the first to congratulate Sam on his retirement,” said Bernie laughing as he immediately dispelled the rumors that he and Sam were considering leaving the ranch real estate industry at the deal’s conclusion.
“The truth is this was just a warm-up for us,” Sam said joining in the fun. “Our next deal is really big.”
But when the talk turned to the new buyer, the mood turned thoughtful and respectful.
“For Stan ranching is a serious enterprise,” Bernie said. “From our perspective, Stan was the ideal buyer. Not only did he have the financial resources to purchase and maintain the ranch, but he is a committed land steward who is passionate about improving the land and conserving it for future generations.”
According to Sam, the family and shareholders encouraged the ranch brokers to find a buyer who would keep the historic ranch, which covers about 800 square miles, intact.
“While keeping the ranch whole was not a requirement, the family and shareholders made it clear it was their preference—and hope—that we would be able to keep the nation’s largest ranch under a single fence unbroken,” Sam said. “Interestingly, all of our serious buyers wanted to keep the ranch and its legacy intact.”
On August 6, 2014, Sam and Bernie were appointed by Judge Dan Mike Bird of the 46th Judicial District Court to market the ranch. The team decided to divide and conquer. Sam worked on mapping, showing routes and a field brochure.
Bernie said, “I’ve been fortunate to do a lot of interesting things and quarterback some complicated deals in my 30-year career, but I have to say working with Sam is one of the high points.”
Bernie took the lead on the marketing strategy and tactics , advertising, PR and media relations. Together they showed the ranch by land and air.
“From the beginning, it was clear that Bernie and I had different styles,” Sam said. “He brought his style and his experience creating his compressed marketing campaign and call for offers, along with comprehensive data room concepts to the table, both of which were invaluable. In my career, I’d never undertaken a data gathering effort like this deal required.”
Complete information is vital to any deal, but it was crucial to this one. One of Uechtritz’s tactics required a $15 million “pay to play” submission by bid finalists in order for their offer to be considered. As a result, potential buyers needed access to complete information up front so they could make that investment with confidence. There was no opportunity for due diligence after the fact.
In January 2015, after several months of intense preparation, the duo initiated an unprecedented global marketing effort. Their concerted efforts generated more than 900 qualified inquiries despite the downturn in oil prices. The inquiries continued until the day the court approved the sale.
“The level of interest was overwhelming, and eventually we showed the property to several different groups and individuals from foreign countries,” Sam said. “What I learned from this experience is that wealthy foreign investors still consider the United States the best place to invest their money—and land, particularly in Texas, is considered a very, very good investment.”
The duo’s call for offers closed on October 25, 2015. Six qualified prospects were selected to make final presentations to the family and shareholders. From those presentations, the final buyer was selected. One of the biggest challenges was keeping the buyer’s identity secret until the transaction was finalized.
“This sale was a huge responsibility,” Bernie said. “We worked long and hard to keep Stan’s identity a secret and to maintain confidentiality.”
He continued with a laugh, “It wasn’t easy because the only thing people agree on in West Texas is that nothing is a secret.”
The details of the deal were hammered out over several months. Joel D. Leadbetter from Hall & Hall in Bozeman, Montana, and Sam Connolly, general manager of Kroenke Ranches, represented Stan Kroenke.
“A deal of this magnitude and complexity is not completed because of the brilliance of a single person,” Bernie said. “It was successful because we got good brokers involved and we worked closely with the exceptional teams representing the owners, the shareholders and the buyers. It was a team effort across the board.”
By all accounts, the results were worth the efforts.
Sam said, “All sides are happy with the results. The family and the shareholders are pleased. It was a complicated deal done right with superlative results for those involved, those affected—and those of us who call Texas home.”
"The new owner is committed to retaining all employees while infusing additional money into the ranch to modernize it, which is good news for the local community," Sam said.
“Selling the Waggoner Ranch intact means everything,” Bernie said. “It means the investment value of Texas land is strong and vibrant. It means the cowboy way is not dead and won’t be for a long, long time. It means there are patriots and land stewards out there like Stan Kroenke—people who don’t have to invest their money in buying r eland, but choose to because they care and want to make it better. Ultimately, it means this national treasure is in good hands. A great day for Texas and American ranching.”
For more information about the Waggoner Ranch, please visit WaggonerRanch.com