A recent tax court case (Iversen, TC Memo. 2012-19 ) barred a Minnesota ranch owner from deducting his ranch losses on his tax return.  In this case, the owner failed to meet the 500 hour test of materially participating in ranch management and activities on a regular, continuous and substantial basis. The owner appeared to use the ranch to entertain clients, but failed to understand the tax laws in relation to ranch ownership. It is not uncommon for ranch owners not to live or work full-time at their ranch and have paid employees who handle the day to day activities.  However, without keeping proper records, business plans, project descriptions and establishing an active involvement in the regular, continuous, and substantial management and day-to-day activities of a property, it can be difficult to prove the required involvement to avoid passive activity classification. Hall & Hall is involved in the management of over 1 million acres of land in the inter-mountain west.  We can help eliminate losses and build long-term profitability. For more information on ranch management, contact Wes Oja at 406/656-7500. Wesley M. Oja, Director Management Group Billings, MT A fifth generation Montanan, Wes was born and raised on his parents’ ranch in the Judith Basin. Since graduating from Montana State University with a B.S. in Agricultural Business, Finance Option and a minor in Economics in 1987, Wes has been involved in grain and livestock marketing throughout the Midwest and Pacific Northwest including nearly a dozen years with CHS, Inc. in Montana, South Dakota and Minnesota. During his eight-year stay in Minneapolis, he spent time as a floor broker at the Minneapolis Grain Exchange and served as president of CHS Inc.’s subsidiary, Country Hedging, Inc. Wes is also a past Director of the Minneapolis Grain Exchange. Wes has been with Hall & Hall Inc. since 2000 and has been a principal and director of the firm since 2003.

Tags: Passive Activity Classification, Ranch Management

Everyone has figured out by now that it is a buyer's market for most classes of real estate in the US. Recently, I ran some statistics from two Multiple Listing Services in Western Montana on behalf of some prospective Sellers. I wanted to see only two reports and my search criteria were simple: 1) All properties that have sold since January 1, 2011 for $1 million or more (excluding commercial and multifamily) and 2) All properties that are currently for sale for $1 million or more. The results were sobering. There were only 11 reported real estate sales meeting these criteria while there are nearly 300 properties actively for sale in this price range! Granted, this process does not include private sales that were unreported to MLS but those sales are very few and far between and would not change the outcome significantly. The point is that a buyer coming into the market right now has plenty to choose from any way you cut it. At Hall and Hall we are lucky to see the best of the best. Each and every property we market and sell is unique and special in its own right. The owners of these properties care for them dearly. Often times, some of the most special memories held within a family involve experiences shared on the family farm or ranch. Understandably, all too often this love for a particular piece of land leads to the belief that it is worth much more than what any market data would suggest it is worth. This is a challenge that virtually every Seller must wrestle with in the current market. In pricing their property, a seller must attempt to essentially divorce themselves from their personal experience with the land they own and put themselves in the shoes of a prospective buyer. It has been said many times that pricing these properties is more art than science. There is much truth to that adage. Pricing the priceless is a difficult job. The "art" of pricing is found, for example, in the process of trying to assign a dollar figure to the view of a certain mountain peak from a certain vantage point. I have always viewed this as a welcome challenge but, in today's market, it often puts me in the position as being the bearer of bad news. With the kind of inventory to actual sales ratio illustrated by the MLS reports referenced above it is of paramount importance to price a property competitively. Prior to the drastic drop in real estate sales volume the market experienced in 2008 we used to place much more weight on what was actively for sale than what had sold in pricing a particular property. It seemed if you used yesterday's price per acre there was already someone standing in line to pay tomorrow's price per acre for it today. Back then we saw properties being priced at seemingly ridiculous prices only to be surprised to find a buyer willing to pay it. Those days are long gone. If a property is priced too aggressively nowadays it is simply lost in a sea of other offerings no matter how special and unique the property may be. Buyers want to know before they even consider visiting a property that the Seller is indeed a Seller. They want to know that the Seller is properly motivated and is going to be realistic. In short, they want to see value. So, in the end it does not matter how glossy the brochure is, how inviting the photographs are or how much money is spent on advertisements if the property is not priced at a level that makes buyers feel compelled to pay a visit. One must avoid the temptation to believe that the place is so special that "all it takes is for one person to fall in love with it and they'll pay whatever is necessary". Remember, to the market's eyes a property is only worth what a buyer is willing to pay. Bill McDavid joined Hall and Hall as a ranch partner in the fall of 1996. He first came to Montana to work as a fly-fishing guide and ranch hand during a summer break from law school. His love of the northern Rocky Mountain region and all that it offers compelled him to move to Missoula where he now manages the Hall and Hall office.

Tags: Buyer's Market, Montana Ranches for Sale, ranch real estate

Hall and Hall Partner Works with Nature Conservancy on Idaho Projects In 2008, the citizens of Blaine County, Idaho passed a two-year levy to raise nearly $3.5 million to support the protection of water, wildlife, open space and working farms and ranches in the county. Hall and Hall real estate partner, Trent Jones of Sun Valley, is a member of the county's Levy Advisory Board which is charged with administering these funds.  In December, the county funded its first project -- a conservation easement over 1,114 acres in the upper Little Wood River drainage owned by Flat Top Sheep Company.  The county partnered with The Nature Conservancy of Idaho on the project.  The conservation easement limits subdivision and residential development while allowing for continued agricultural and recreational uses. Hall and Hall has a long history working with landowners and conservation-oriented buyers in the Little Wood area.  In November, Hall and Hall represented a conservation buyer in the purchase of 2,300 acres featuring 3 miles of the upper Little Wood River. [caption id="attachment_1513" align="aligncenter" width="503" caption="This Little Wood River conservation easement limits subdivision and residential development while allowing for continued agricultural and recreational uses."][/caption]   Trent Jones Real Estate Partner Sun Valley, ID Trent came to Hall and Hall in the spring of 2003 after spending eight years with The Idaho Nature Conservancy where as Lands Program Director he was responsible for overseeing the chapter’s real estate activity around the state. Trent also served as the Conservancy’s field representative for central Idaho where he worked with local communities and landowners to preserve working ranchlands and resolve natural resource conflicts. He became a partner of Hall and Hall in March 2004. A native of Virginia, Trent graduated from Woodberry Forest School and earned his Bachelor of Arts degree in history from Hampden-Sydney College. Trent and his wife, Cecile, moved west to Idaho in 1994. Enjoyment of the outdoors is evident in Trent’s dedication to fly-fishing and upland bird hunting. He currently serves on the Board of Directors of the Wood River Land Trust. Trent and Cecile have two children, a son Parker and a daughter Airey.

Tags: blain county idaho, idaho farms, Idaho Ranches, Little Wood River ranches, Nature Conservancy Projects

Joining Hall and Hall in 2003 gave me the opportunity to position my future and that of my clients with the most trusted brokerage firm in the business.  It is a privilege I am immensely thankful for everyday.  Jack Orr, founder of Orr Land Company and a 30 year veteran introduced me to the business of ranch real estate brokerage.  Jack was an excellent mentor and taught me many things but none more important than this: it's about building mutually beneficial and enduring relationships with every buyer and seller and with every strategic partner that comes to the table. The vast majority of our transaction volume at Hall and Hall is referral oriented and grounded in relationships we have spent decades building.  Referrals are the source and foundation for everything we do.  Our business model is centered around building and maintaining long-term relationships - one person, one property, one transaction at a time.  Whether measured by the number of transactions, repeat transactions or business referrals, behind the measures are personal relationships premised on mutual understanding, respect and trust.  The properties we sell represent a uniquely complex and increasingly recognized asset class best suited for visionaries.  Clients invest in ranches as an expression of who they are and what they value.  Their deeply rooted criteria extend well beyond themselves to family, friends, business partners and future generations.  Knowing, appreciating and relating to these clients is a cornerstone of relationship building. Recently I had the opportunity to spend two amazing days with one of those clients, Dan Souders.  Dan is the founder of Western Disposal Services in Boulder, Colorado, a respected contributor to his community and a devoted husband, father and grandfather.  Nearly 15 years ago, when I was just a rookie in the ranch real estate business, Dan entrusted the sale of one of the first ranches he owned with me.  Currently I am representing him in the sale of Round Mountain Ranch in Steamboat Springs, Colorado.  The importance of our relationship is embodied in the following statement from Dan: "Whether I am buying or selling, it is reassuring to know Jeff and the Hall and Hall team are listening to me and representing my best interests.  To know Jeff as a person and what he stands for is very important to me."  Dan Souders, February 2012 Enjoy this short video with highlights of my time with Dan on our tour of Mill Creek Ranch in Los Molinos, California.  Then join us as we take off in a Colorado blizzard to steward the potential sale of Round Mountain Ranch.  I am humbled and incredibly thankful to be a part of the relationship we share, thank you Dan. Share your comments - on the subject of "building relationships." >>> Please Let Us Know What You Think of This Video Written by: Jeff Buerger Real Estate Partner Ridgway, Colorado

Tags: Mill Creek Ranch, Ranch Property, ranch real estate, Ranches for Sale

Ranches and Farms for Sale in Nebraska

After living in Denver, Colorado, arguably the nicest city in the world for 32 years, I decided to move back to the plains to be closer to a region into which Hall and Hall wanted to expand. But more that that, I wanted to be be with the one who captured my heart, who also resides in this part of the country.

Maintaining close ties to agricultural communities is a big part of what our mortgage banking and resource management division does at Hall and Hall. Lenders look to us to understand the characteristics that create value in rural  land. These features can include a diversity of agricultural resources, recreational features, conservation potential, location, and building improvements.

Due to a busy holiday schedule for my sons (my moving help), I decided to pickup and go sooner than originally planned. Packing and loading hastily with a storm brewing on the horizon created quite a sense of urgency. My Marine son and his bride are used to quick moves and showed me that packing fast and tight was considered more important than care and sentiment. “So what about a few scratches here and there,” he said.  My recently married and computer savvy son and his engineer wife made out like bandits in the deal, taking all the excess items that wouldn’t fit, or wouldn't work for me in my new location. I’ve tried to convince myself that they are simply "storing" the stuff for me, but in reality, I think they now have their brand on it. Sigh. Now I’m in my new home in the heartland of Nebraska, I have the wonderful opportunity to travel around Kansas and South Dakota, meeting and doing business with the best kind of people in the world. On the occasional trip back to Denver I can get a quick neon fix and peek at the Rocky Mountains, so what could be better than this? Folks ask, “Isn’t it boring out there?” That’s answered with a quick, “No”. Things are happening in the heartland, optimism is boundless, not to mention that I find great beauty traveling though the great Nebraska farmland and ranch land of this area. Life is good! Our dog, Kayda,  and cat, IT,  seem to have adjusted to the change, and my new backyard view isn’t too bad no matter what the season is! [caption id="attachment_1476" align="aligncenter" width="601" caption="My New Nebraska Home."][/caption]   [caption id="attachment_1481" align="aligncenter" width="600" caption="IT and Kayda....our two best friends."][/caption] C.R. (Randy) Clavel, A.R.A. Management Group Denver, CO Raised on ranches in South Dakota and New Mexico, Randy joined Hall and Hall Mortgage Corporation in 1991, focusing on the multitask real estate environment, including lending, sales, management and appraisals. When Hall and Hall Mortgage and Hall and Hall Incorporated merged in January 2000, Randy became a principal of the new Hall and Hall. Previously, he worked in the Denver real estate department of The Travelers. Randy is an Accredited Rural Appraiser (A.R.A.), a state-certified appraiser in Colorado, South Dakota, and Wyoming, and a licensed broker in several states. He holds a B.S. in Agriculture from South Dakota State University.

Tags: Farms for Sale, Ranches for Sale Nebraska

My good friend and professional photographer, Craig Hergert ( Montana Panoramic Company) , my nine-month-old springer spaniel pup and I recently spent a few days at Cheyenne Ridge's Signature Lodge, North Platte Outpost.   Our host was Sean Finley, the Outdoor Concierge and Executive Chef .   This lodge is situated on an expansive ranch along the North Platte River in Scottsbluff, Nebraska and is a destination for tens of thousands of ducks and geese that feed and roost on this property. Endorsed by the highly acclaimed Berretta Trident Program, the service, guides,  culinary experience, and general hospitality were A+. The weather was a balmy 50 degrees and bagging a limit of ducks in the early morning hours took  several hours.  “Normal” winter conditions usually provide swarms of mallards piling into the decoy’s but with the warm weather these birds became rather lethargic and appeared in smaller but consistent numbers.  We extended the hunts taking turn gunning and even broke out the light shotguns (a 20 and 28 gauge) on the final morning. Goose hunts out of pit blinds placed strategically in corn fields provided afternoon entertainment along with pheasant hunting and  tout fishing.  The guides handled everything, including the calling,  and made our stay productive, relaxing and overly enjoyable.  I’d recommend the trip to anyone that loves upland bird, waterfowl, whitetail deer, turkey hunting, and of course eating gourmet meals paired with fine wines. This is production agriculture  part of the country with corn and sugar beets being the primary crops.  It has become a hotbed of investment quality farmland, with productive soils and an abundance of water out of the Ogallala Aquifer.  Recently, billionaire John Malone purchased a portion of the ranch on which Cheyenne Ridge  is based.  Coincidentally, I discovered that the Weinreis brothers who own Cheyenne Ridge Signature Lodge, recently purchased Circle Cross Ranch from Hall and Hall at a December  auction.  This 40,000 acre ranch is located along the Niobrara River in northwestern Nebraska and there are reported plans to continue the ranching operations and fold this into their mix of destination hunting lodges.  In addition to being a great operating cattle ranch, the Circle Cross has the ancillary benefit of hosting a variety of game animals that include mule deer, turkey and upland birds and it will be quite interesting to see how Cheyenne Ridge plays a role in evolving this ranch. Timothy P. Murphy Real Estate Partner Bozeman, MT A native of Iowa, Tim moved to Bozeman after college in 1991 to pursue a Montana lifestyle. He joined Hall and Hall in 2004 after spending four years with Fay Ranches. Tim holds a real estate license in several states. Prior to selling ranches he worked in ranch management, focusing on resource management to develop aquatic and wildlife habitat while balancing good farming practices. Tim has great depth in his experience of the outdoors and is a passionate big game, upland and waterfowl hunter as well as a skilled fly-fisherman. He is a member of and has served on committees for the Rocky Mountain Elk Foundation, Ducks Unlimited, Trout Unlimited and Pheasants Forever foundations. A proponent of practical land use, Tim has specialized in pairing conservation-minded buyers with sensitive acreage needs in an effort to preserve the agricultural landscape and lifestyle upon which the American west as we know it was founded.

Tags: Auctions in Nebraska, nebraska bird hunting, nebraska hunting ranch, nebraska ranches for sale