Mammoth Real Estate Q&A — Under All Is The Land

This Mammoth Real Estate Q&A appears in the 4th of July week issue of The Sheet.

Q: We’ve been reading your columns for years and we’re sure you have some interesting real estate stories to tell. What are your most interesting and memorable transactions, and why?

A: When I think back on my “stand out” transactions, or real estate experiences, most are centered on historic properties in the region that have some other sort of interesting significance, and of course, some likely controversy. The history of the owners, the land, and the developments that occurred on the land are enlightening about the history of the region. The owners, sellers and buyers also tend to be a different breed. There often tends to be some (crazy?) emotions amongst the parties too. These factors make for memorable real estate experiences. And most times, for better or for worse.  

The most memorable is without question the sale of the infamous “Cunningham” property on the western shore of Mono Lake. This ~110-acre parcel had been in the family for nearly 80 years. The parcel sits adjacent to the historic Tioga Lodge property that the family owned and operated during its heyday of the 1930s and 40s and beyond. The Lodge and resort were a large attraction in Mono County before Mammoth Mountain was ever established. There was a fancy white table cloth restaurant that interestingly featured an all Chinese staff. It was located on the lakeside property below the current Hwy. 395. There were also extensive rose gardens and trout ponds. The Lake was used for power boat races and there were other events like beauty pageants. All in an era of depression and war.

But the adjacent, upsloping 110 acres had been mostly unused over the years except for one house and a series of “spring boxes” for water capture. The family had purchased the property from the original homesteader. Southern California Edison has an access easement on a switchback road so they can service major power lines at the rear of the property. The view of the Lake at the upper benches is nothing but spectacular. Today, the property is deeded to the “United States of America” and all that remains on the lower portion is a historic outhouse. And a commemorative plaque about the land exchange.

The demand for the property was driven by the fact that it was number one on the list of privately held parcels in the western United States that the Forest Service wanted to acquire and return to public ownership, and ultimately preserve the land from any further and future development. It became the primary acquisition target for anyone looking to do a Forest Service land exchange in the western United States and especially in the eastern Sierra.

In the early 2000s, the owners came to me to list the property for sale. Soon after there was an agreement to involve the property in an exchange for the “McFlex” property at the entrance to Mammoth that today includes the court building, police station, new County building and proposed Town civic center. But then the Ski Area stepped in. And that started a prolonged (almost five years) negotiation, re-negotiation and an almost all-out war between the buyer and seller. The buyer was adamant that they needed to be in the “good graces of the environmental movement”, and was obsessed with acquiring this property.

The transaction went off the rails so many times that it is amazing it ever closed. It became a  battle of personalities, very opposite personalities. And I was in the middle of it the whole way. I often hear conjecture that real state transactions would go smoother if the buyer and seller could meet and “work things out.” But this became a classic case of why a buyer (and his cohorts) and the seller should never meet. And to make matters worse, bureaucratic levels of the Forest Service and their “approved appraisers” (MAI—made as instructed) brought a massive level of distrust and delay to the entire process.

There were many lessons to be gleaned out of the entire mess and process. For one, in any negotiation, stick to issues and leave personalities out of it. I tried to remain focused on the issues, but the swirling, near-psychotic behavior and animosity became a impossible distraction. The buyer and seller egos almost made the transaction points secondary. Another good lesson; once the parties have agreed to terms, keep your mouth shut as much as possible. Extraneous inputs are rarely helpful. There’s an old saying, “More deals go down the drain going down the elevator.” And maybe even more important in negotiation; have a clear understanding of who is in the position of strength.

Ultimately, the transaction was completed at a lower sales price than originally agreed upon. The irony is that the buyer had to purchase even more properties and also include a large amount of cash to finalize the Main Lodge property exchange. It all had to add up to the appraised value of the Main Lodge property, and pass approval in Washington DC. All of the nonsense delayed the process by another four+ years with no real economic gain. Through this last economic cycle, that delay could have been important to the project’s future success. But only time will tell.

One interesting thing that happened in all of this; the Forest Service placed no value on the 10 acres between Highway 395 and the Lake. They referred to it as an “uneconomic remainder.” But our past, favorite local civil engineer came up with a great plan. The seller offered to donate the real estate under Highway 395 to Caltrans, and they accepted. They eagerly (and quickly) surveyed the land and created a new parcel map and the property was deeded to Caltrans. The process created a silent administrative lot split. Some 15 years later those 10 acres that were deemed worthless were sold for a tidy sum to preserve it from any future development.     

All of the time spent in the Mono Basin led to other curious adventures. I worked with the Adam’s family on the Mono Inn Property and had the opportunity to stand in Ansel’s historic in-house darkroom in Carmel (how cool is that?). It also led to handling the recent estate-sale of the Tioga Lodge property, and the potentially gold-rich 880 acres in the Bodie Hills that is in the process of being returned to public ownership. Most people don’t realize there is actually more land reverting to public ownership in Mono County than becoming privatized. Private land is becoming an even more rare commodity in Mono County.

The other very memorable real estate dealings have been right here in Mammoth in The Bluffs. But it has been hardly just one transaction. It has been an ongoing journey. It started in 1990 and for the next ten years I would be involved in the planning (and organizing) of the subdivision from the development side, approving the subdivision as a public official, and involved in brokering the bulk of the new subdivision’s lots. All without violating any conflict of interest laws. 

In 1990 a developer I worked with (and for) purchased the 70% of the lots in The Bluffs that were still owned by one person. At that time the subdivision was simply a “paper” subdivision that had been created in 1923 but never improved (streets, utilities, etc.). Over the decades, thirty percent of the lots had been sold off to random owners, or gifted to owners like the Catholic Archdiocese of Stockton. In order to finally construct the subdivision, the idea was to complete a huge (legal) lot line adjustment to make the subdivision buildable and conform to modern subdivision laws. And all of the various owners had to be in agreement with the plan. The process was brought to public meetings, but I had to recuse myself at the Planning Commission meetings in the early 1990’s. At the time, there was minor opposition to the project by those who believed the property should remain as open space even though it was private, subdivided land.

Between recession and drought, the project lost steam and the new owner and developer eventually left town. About five years later, the lots (70%) were acquired at a local sheriff’s sale by a Temecula-based rancher/developer. He brought the new proposal forward and had the support from the balance of the owners (they were ready) and the Town fathers. This time around I was clear to vote on the project with no conflicts. The proposal passed, and again with some minor opposition. 

The new, modern subdivision was constructed shortly thereafter in the form it is today. In 1999 I was (thankfully) out of public office based on term limits. Shortly thereafter the Temecula rancher decided to list his lots with one of my associate brokers. The agents in my company at the time got to heavily participate in the sales of these spectacular lots. Since 2000 there has been an increasing number of outrageous homes built in the subdivision. There are no CC&Rs or architectural guidelines so anything can happen. If anyone has a lack of confidence in the Mammoth real estate market, just take drive through The Bluffs. And I expect that some of the early, “modest” homes in the subdivision may soon become “tear downs” or prime for significant additions and remodels.

But for me the saga continues. In the summer of 2024, I have the “Archdiocese lots” listed for sale. They were not included in the lot line adjustment redraw. They were the “uneconomic remainder” of the Bluffs. But today, there is a new potential. They offer a unique, private  “estate” opportunity that the Mammoth market may very well be ready for. Privacy, view and surrounding open space are becoming the true luxury in the market.

There are plenty of other things that do stand out. The property where the Limelight is being constructed was owned by one of my former associates. We talked for years about the potential of the property. We never thought it would look like it does today. And I currently have a home listed in Old Mammoth that the land has been in the family since 1926. And they even have the 98-year old grant deed. And now I am representing the historic motel property (36 acres) just up from Tom’s Place. It too is a privacy/open space estate/ranch opportunity that rarely comes along. 

Being involved with these properties and their history and significance has added a rewarding and intriguing layer to my real estate career. Perhaps, it could have been easier (and more lucrative) to sell a bunch of cookie-cutter condos. But it certainly wouldn’t be more memorable.  

 Happy 4th of July!

 

 

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