Letter of Intent Signed to Sell Up to 437,000 Acres of California Desert Land to the Federal Government
SAN FRANCISCO--(BUSINESS WIRE) Catellus Development Corp. (NYSE:CDX), The Wildlands Conservancy and the U.S. Department of the Interior's Bureau of Land Management (BLM) announced today that a non-binding letter of intent has been signed among the three entities to sell and donate to the federal government up to 437,000 acres of California desert land currently owned by Catellus.
The Catellus-owned acreage includes land within the Mojave National Preserve and BLM-administered wilderness areas created by the California Desert Protection Act of 1994. It also includes other sensitive ecological and cultural lands, critical habitat for the endangered desert tortoise, and certain off-road vehicle areas. It is the intent of the three parties to finalize a formal agreement during the first quarter of this year.
In this preliminary agreement, Catellus has agreed to sell 437,000 acres to the federal government for a total cash consideration of $54.625 million, of which The Wildlands Conservancy, an Oak Glen, Calif.-based conservation group, will donate $18.625 million in private funds. The parties have agreed to confirm the total cash consideration for the lands with an appraisal to occur later this year. The value in excess of the cash consideration will be donated to The Wildlands Conservancy or the federal government as a charitable contribution from Catellus.
The Wildlands Conservancy is seeking congressional approval for a $36.0 million allocation of federal funds for this effort from the Land and Water Conservation Fund. The request for these funds is expected to be submitted to Congress in February of this year as part of the Fiscal Year 2000 Budget Request from the Clinton Administration.
Following appropriation of the necessary federal funds and the raising of the necessary private funds, transfer of the 437,000 acres is anticipated to occur by January, 2000. The Wildlands Conservancy has agreed to place into escrow a $5.0 million deposit towards the purchase of the land.
The Wildlands Conservancy will also donate 26,360 acres previously purchased to BLM and the National Park Service and will donate an additional $2.0 million in cash for acquisition of up to 20,000 acres of private inholdings in Joshua Tree National Park. The total transaction will bring up to 483,360 acres into federal ownership and will consolidate public ownership in Joshua Tree National Park, Mojave National Preserve, and numerous BLM wilderness areas.
In addition, it will transfer to public ownership significant critical habitat for the endangered desert tortoise, enhance recreational opportunities in off-highway vehicle areas, and create a wildlife corridor between Joshua Tree National Park and Mojave National Preserve.
The letter of intent also contains a related agreement between Catellus and BLM that calls for the exchange of up to an additional 65,000 acres of California desert land currently owned by Catellus for land managed by BLM. The specific acreage to be exchanged will be determined based on an appraisal to occur later this year and the exchange will be made on an equal value basis.
Through this transaction, Catellus is seeking to both consolidate its desert holdings, much of which is checker-boarded across the desert, and to exchange certain acres of land with critical resource values to BLM for land that would be suitable for development or other purposes, or that is located near existing development in Barstow, Mojave and Needles.
"We are pleased that we have been able to reach these agreements with The Wildlands Conservancy and BLM," said Nelson C. Rising, president and chief executive officer of Catellus Development Corp. "These transactions benefit our shareholders in allowing us to monetize a portion of our non-strategic holdings that can be reinvested into our core businesses and to exchange another portion of these holdings into locations closer to population centers and transportation corridors."
"Following these transactions, we will have reduced and consolidated our desert portfolio to just over 300,000 acres of land," Rising continued. "In addition, we will be able to make a charitable contribution of critical preserve lands and become part of an historic transaction facilitated by The Wildlands Conservancy that will benefit not only BLM but also the National Park Service and the American public."
"This letter of intent is the culmination of four years of work and determination on the part of our organization," said David Myers, executive director of The Wildlands Conservancy. "This transaction will preserve the biological and aesthetic integrity and recreational access to over 4.0 million acres of public land in Southern California. We are pleased that we could work successfully with Catellus and BLM in the largest conservation acquisition and donation in California history."
"The historic agreement reached today could not only bring half a million acres of private inholdings into public ownership, but also ensure the permanent integrity of much of the wilderness, parks, critical wildlife habitat, and recreation areas of the California Desert. This unprecedented Federal/private partnership will give the California Desert the national attention this region deserves," declared Ed Hastey, BLM's California State Director.
Catellus Development Corp. is one of the nation's premier diversified real estate operating companies with one of the largest portfolios of developable land in the western United States. The company develops, manages and owns a broad range of product types including commercial, residential, office, retail and major mixed-use projects. At Sept. 30, 1998, Catellus' strategic land portfolio had a development potential of over 54.7 million square feet of new commercial space, exclusive of 4.9 million square feet of commercial space under construction and an estimated 21,000 residential units.
The company's income-producing portfolio included 18.9 million square feet of income-producing buildings, 12,250 acres of income-producing land leases, interests in a variety of joint ventures and approximately 782,000 acres of desert and agricultural land. For more information on Catellus Development Corp., please visit its corporate web site at http://www.catellus.com.
The Wildlands Conservancy, a California non-profit corporation formed in 1995, is dedicated to preserving Southern California's outstanding landscapes for public enjoyment. The Conservancy places special emphasis on enriching the lives of urban youth by funding field trips to its preserves in Kern, San Bernardino and Riverside Counties and other natural areas. The Conservancy is redirecting funding for this effort from other important projects and welcomes support to carry on its important mission.