Bo Matheny

Real Estate Transactions Can be 'Win Win'

While 'Agency' prevails as an issue in today's real estate brokerage, real estate transactions need not be adversarial (between brokers or between principals). In fact, in an open minded atmosphere of mutual trust, confidence, cooperation, and understanding, they can actually be unanimously beneficial and rewarding. Following is a favorite true example which represents probably the most unique and (spiritually) rewarding real estate transaction in which I've ever participated.

Several years ago, an associate in the office (Mike) introduced to me his contacts with Saint Giles Soccer Club, a large local youth organization who wished to acquire some land for developing a large soccer complex with 10-12 fields to host regional tournaments, etc. We agreed to work together to help them find and acquire an optimally suitable property. Their primary needs included: 40-50 acres, a reasonably convenient and accessible location, suitable zoning, minimal site preparation requirements (as flat and ‘unwooded' as possible), ideally with access to a natural water source (creek, lake, etc.) for economical maintenance and irrigation, and of course, affordability. With the active support of 700+ local families, Saint Giles had some reasonable, but limited, available cash and borrowing power, and they very much needed to watch their budget and justify their expenditures.

Over some time, Mike and I sought out, identified, and submitted to Saint Giles numerous properties seemingly offering some possibilities, but none of them seemed to be an ideal 'fit'. Then one day I received an inquiry from a friend about a 10 acre land tract listed for sale by another associate (Pat). While finding that this property was not what my friend was seeking, I discovered that the 10 acres offered for sale was actually a part of a 50 acre tract belonging to the same owner. The land was very affordable and reasonably priced, as it had minimal alternative utility or development potential due to its distance from other development and its close proximity to a landfill. However, for Saint Giles, it was seemingly in a very do-able location for reasonable access, it was very flat and unwooded, it was well configured for developing soccer fields, and it bordered a creek. Thus thinking it might offer good possibilities for Saint Giles, I asked Pat if the owner might consider selling the entire 50 acres to them for their intended use. That's when the transaction, and the real story, began.

Pat proceeded to explain to me how Mr. Watson subsisted by living off his land and his 10 cows, and that he was extremely emotionally attached to this property, as it had been in his family for generations. He was only reluctantly considering selling 10 acres because his survival dictated it. To help try to make ends meet, he literally 'picked up cans' that fell (or graciously got thrown) from garbage trucks heading to the nearby landfill. Regardless, she seriously doubted that we could convince him to sell 50 acres, and she suggested that meeting meeting/talking with him would like stepping back in time and be a challenge akin to doing so with the Beverly Hillbillies. While I don't claim to be the greatest salesman around, I've always prided myself on being able to converse with, and listen to, people on any level. I pressed for a meeting which she gladly arranged. She advised me that I was in for quite an experience, which I surely was.

Since Mr. Watson had no phone, we drove out unannounced to his home (across the road from the subject property) to meet with him to discuss his wants and needs and see if they might be compatible with those of Saint Giles. After Pat blew the horn twice to announce our arrival, he hobbled out on his walker, in his 'well worn' overalls to let us in the gate. We proceeded to congregate in three rickety lawn chairs in front of his very modest home to talk as I watched a dog chase chickens through junk cars sitting on his property. I quickly learned that Mr. Watson had lived on his property for his 76+ years, as had his parents before him. On the subject 50 acres, his dad had built a barn which he wanted to stand forever, and his 10 cows had ample space to graze (I learned that cows usually require about 1 acre of pasture each) and drink from the existing creek. Those concerns were very important to him. He was appreciative of the fact that our prospective use of the land would be constructively beneficial and enjoyable for youngsters, and he was complimented by our suggestion that the park could be named for his family, but he still dreaded the thought of parting with his family property. Monetary considerations seemed to mean virtually nothing to him, as he had 'very little use for money'. However he did concede at one point that it would be nice to be able to buy a mobile home for his lady friend, Dot. While I repeatedly emphasized that Saint Giles needed at least 40 acres, and suggested that some cash and/or monthly income from such a sale could seemingly be rather handy to him, he repeatedly asked if they could get by with just the 10 acres. We concluded our meeting, agreeing to talk some more later .

A couple of days later, Mike and I met with Saint Giles to brief them on this 50 acre tract and my discussions with Mr. Watson. They agreed that this property would be ideal for their needs if we could somehow put together the appropriate transaction. With my prompting and some open-mindedness and creativity, we came up with the following proposal. Saint Giles would contract on the entire 50 acres based on the same per acre price being asked for the 10 acres. Then, they would give Mr. Watson a Life Estate on 10 acres that would include the barn and they would install a fence between the 2 parcels in such a way as to separate the cows from the planned soccer fields while providing mutual access to the creek for watering his cows and their soccer fields. They would tender a down payment somewhat more than ample for purchasing a mobile home for Dot and for paying the real estate brokerage fees, and then pay him monthly payments on the balance at a reasonable interest rate. Pat was elated with the offer that was submitted, recognizing how beneficial it could be to Mr. Watson but concerned that he still might not be able to commit himself to such a sale. When she went to present the offer, she found no one home but on her way home noticed him riding down the road with Dot, so she flagged them down and took them to a fast food restaurant to present the offer. She learned that they had been at the electric company making arrangements (planning the sale of a cow for $40) to avoid having his electricity turned off because of a $36 past due power bill. As she fully explained the offer and its potential benefits to him, he began crying as he realized how helpful it would be to him, and he agreed to accept it. Several weeks later, we closed on a real estate transaction that was truly rewarding for everyone involved. Along with a commensurate fee that was very willingly tendered, we agents/brokers received a wealth of gratification. Saint Giles very comfortably acquired a property that has become a soccer complex which generates a lot of enjoyment and beneficial experiences for many youths. And, although Mr. Watson indicated at closing that he still didn't 'aim to' have a telephone (that almost made me a little jealous), he never again had to worry so much about his electric bill. Pat discouraged me before from saying too much about this transaction, as she felt like Mr. Watson would prefer it that way. Hopefully it's okay now - I recently learned that he passed away several months ago, shortly after receiving his last payment from Saint Giles. Hopefully, his last years were a little more comfortable because of the efforts of some realtors.

Certainly, compared to folks like Mr. Watson, few of us fully appreciate how good we have it. And clearly, on occasions when the participants are unselfish, cooperative, attentive to and understanding of each other's needs and wants, and have reasonable and realistic expectations of each other, a real estate transaction can have enough benefits to truly be 'win-win' for everyone involved. Personally, while many other transactions have generated higher commissions for me, none have been quite so rewarding or so unique.

Bo Matheny, REALTOR

RE/MAX Foothills Downtown at the Hyatt