Over the last few years, investment in “legacy ranches” across the West has grown in popularity. A number of factors created the “perfect storm” for investing in large, rural properties with certain assets.
According to Harrigan Land Co.’s Hunter Harrigan, the legacy land boom can be largely attributed to three outside circumstances.
The pandemic inspired solitude
First, he says, the COVID-19 outbreak encouraged families with the means to find safe, rural destinations away from populated areas that were perceived to be more risky at the time.
People were “looking for a place to take their family that’s safe, to get out of the cities while a lot of stuff was shut down,” Harrigan told News Nation recently.
Dependable place to keep money
Second, Harrigan says, economic uncertainty during the outbreak contributed to significant interest in these large swaths of rural, private property. Large ranches offered excellent opportunities for investors who wanted to park large sums of money and hopefully see those investments become more valuable.
“Demand came from those investors to buy these large ranches and hedge against the inflation that was coming,” Harrigan says.
Demand increased for places with abundant recreational opportunities, like trout streams, wildlife for hunting or photography or ranch property that was located near ski resorts.
The ‘Yellowstone’ effect
Third, Harrigan says, is the lifestyle portrayed in the popular TV show, “Yellowstone,” that depicts a long-time ranch family struggling to hang on to its land in the face of numerous threats.
The show, he says, “has kind of made owning ranches cool again.”
Today, with economic uncertainty still looming, a host of factors still influencing the real estate market, the large ranch market is still quite stable. That could be because cash buyers aren’t beholden to rising interest rates that are keeping buyers in other sectors from pulling the trigger on large purchases.
In other words, these legacy ranches offer benefits for both investors looking for dependable places to put significant cash and for sellers who want to get top dollar for their property.
As Harrigan explains in an interview with The Daily Mail earlier this month, “people aren’t necessarily buying these ranches anymore for what they can produce in income, but the long-term appreciation.”
That means that ranch property that offers more than just acreage for livestock or other agricultural production is likely more valuable to long-term land investors. Take western Wyoming’s Harrower Ranch, for instance. The property boasts more than 5,000 deeded acres of high-elevation steppe country and includes 200,000 acres of leased Bureau of Land Management property. Today, the ranch can run about 600 cows, but for a potential investor for whom the agricultural benefits might be secondary, Harrower has other, potentially more appealing assets.
The ranch includes about eight miles of Fontenelle Creek. Flowing through lush meadows at 6,800 feet above sea level, the creek is an excellent trout stream — an asset that could also become a revenue opportunity. The ranch is also home to pronghorn, mule deer, elk and even moose. Its proximity to Jackson Hole, Wyo. and its recreational assets add even more appeal to savvy investors looking for a unique opportunity.
“For a lot of these old ranchers a trout stream was just a place to pull the irrigation water from to irrigate their hay meadows,’ Harrigan tells the Daily Mail. “[Now] owning a trout stream is like owning a piece of beachfront property. We only have a limited number of river corridors in the Mountain West that have the right water temperatures and habitat and everything else to support trout.”
It’s exactly the kind of property that offers investors certainty and sellers an appealing sales price.