Our real estate developments incorporate environmental practices. In rural real estate, conservation outcomes are at the heart of our objectives, and we seek to partner with organizations to benefit recreation, water quality, and wildlife.
PotlatchDeltic’s real estate development business currently consists of two communities that were part of the merger in 2018 with Deltic Timber Corporation: Chenal Valley and Red Oak Ridge.
Our Chenal Valley master-planned community in west Little Rock is one of the premier real estate developments in Arkansas. We develop and sell both residential and commercial property while incorporating several environmentally conscious practices into the development process. The Chenal area consists of 6,700 acres, of which 60% is designated as residential. Approximately 20% of each neighborhood is set aside as greenspace. In addition, large areas of greenspace, about 15% of the total acreage, are preserved throughout the development and between neighborhoods.
The master plan is generally designed around the existing topography with more dense development in flat areas and less dense development and greenspace in the areas with steeper slopes. Walking paths have been constructed to connect the different areas of Chenal, along with bike paths and playgrounds, to promote a healthy lifestyle for residents.
The Chenal Valley community includes the Chenal Golf and Country Club in Little Rock, which consists of two 18-hole professional golf courses woven throughout the development. Both courses use current technology to manage and conserve water usage as well as to offer urban habitats for wildlife. This technology includes the use of highly efficient irrigation equipment and monitoring equipment including rainfall sensors. These courses provide stormwater detention for the entire Chenal Valley development within the Rock Creek watershed and maintain peak discharges to predevelopment levels. Water management for each course was designed and engineered based upon the distinct geographic and environmental conditions found on each site. Both golf courses are certified as Audubon Cooperative Sanctuaries. This designation exemplifies the Club’s long-term commitment to the protection of the natural environment.
Our Red Oak Ridge development in Hot Springs, Arkansas incorporates many of the same environmentally conscious practices. Large areas within and around the neighborhoods are set aside as greenspace. Walking paths connect the neighborhoods and traverse through adjacent forestland. In addition, Red Oak includes two man-made lakes that provide stormwater detention for the development. The area surrounding the lakes retains its natural vegetative cover to limit erosion and sedimentation. We have developed a fish management program to enhance fishing and we prohibit motorized boats to maintain water quality and a peaceful environment.
Our rural land sales efforts have focused on lands that we have identified as non-strategic or that have a higher and better use than timberland management. These higher uses can be the result of conservation objectives, demand for rural recreational real estate, or other uses such as solar energy sites. In Minnesota, rural lands have been in high demand for both conservation and recreational purposes, and we have largely completed a strategic initiative to sell these lands over the last 15 years. In Arkansas, and our other southern states, rural land sales tend to focus more on recreation and adjacent landowner interest. The merger with Deltic Timber provided additional future lands for sale that were analyzed through our land stratification process. Our merger with CatchMark increased our ownership in Georgia, South Carolina, and Alabama. Over time we will research and identify those specific areas and properties that are best-suited for conservation outcomes.
We are proud to have a significant amount of conservation outcomes from our rural land sales, totaling nearly 240,000 acres since 2004. More recently, since 2018, approximately 70% of our rural land sales acreage has been for conservation outcomes with nearly all the remaining 30% for recreational purposes. These conservation outcomes have been particularly prevalent in Minnesota where our lands were scattered in areas with unique recreational values and wildlife habitats. In Idaho, early conservation transactions included a conservation easement on over 50,000 acres as part of Idaho’s Forest Legacy Program along the scenic St. Joe River. The St. Joe River is a blue-ribbon Westslope cutthroat trout fishery and the easement permanently secured public access and protected wildlife habitat and sustainable forest management in perpetuity. In Arkansas, we partnered with and sold land to the Central Arkansas Water District, which had established a 4,500-acre land purchase program to acquire properties with the objective of safeguarding one of the largest sources of drinking water in the region – Lake Maumelle and the Maumelle River. The purchases enabled specific restoration initiatives in the watershed by focusing on minimizing erosion and silting in the lake and preventing development. A notable Arkansas conservation outcome this year was the sale to The Nature Conservancy to extend the Blue Mountain Nature Reserve, adding nature and bike trails for public use.
Rural recreational land transactions provide an opportunity for neighboring landowners to increase their ownership, and for both in-state and out-of-state buyers to find a place where they can get away to a rural home, go hunting, fishing, hiking, and enjoy the outdoors. Recreational land buyers often have a management plan for wildlife habitat on the property and may obtain a related income stream from active timber management. These transactions can provide the owner a legacy of land ownership and can introduce future generations to the benefits of the outdoors, timberlands, and wildlife.
A significant portion of the timberland we once owned in north-central and north-eastern Minnesota was uniquely situated in its ability to participate in conservation outcomes. Over the last 15 years, we have implemented a strategy to work with numerous private and public partners to sell over 143,000 acres for conservation and other public values. When our final planned conservation sales in Minnesota are completed, the total could exceed 157,000 acres for these purposes. The conservation transactions have accomplished several goals among a wide range of stakeholders including opening landlocked parcels, keeping working forests as forests, protecting wildlife habitat, wetland mitigation restoration banks, tribal lands, recreational trails, and preserving unique locations.
Sometimes complex transactions can accomplish a set of very different goals among a range of stakeholders. Such was the case with the “Plan B” transaction, which involved the Boundary Waters Canoe Area Wilderness (BWCAW), a renowned recreational paradise in the northern third of Superior National Forest. Minnesota School Trust Lands held 82,400 acres of lands granted at statehood to support public education that were embedded within BWCAC, and that had not been accessible in order to generate revenue for the schools. The U.S. Forest Service (USFS) wanted to incorporate the lands into the BWCAW for recreational access.
The solution was a creative three-way land swap with The Conservation Fund (TCF) purchasing 40,000 acres of neighboring PotlatchDeltic land over five phases, which would then be exchanged in phases for equally valued School Trust Lands inside the wilderness area. TCF would then sell those lands within the wilderness to the USFS for incorporation into the BWCAW. The last two phases of this transaction for PotlatchDeltic consist of just under 15,000 acres and are expected to be completed by 2022. Once completed, the transactions will ensure that the new Minnesota School Trust lands serve as long-term revenue sources for the schools, keep working forests as working forests, support jobs and local communities, and enable the lakefront lands placed within the BWCAW to be preserved for recreational access.
Protection of wildlife habitat was a conservation outcome of several of our transactions in Minnesota. A transaction with The Trust for Public Land (TPL), with a subsequent sale to Crow Wing County, resulted in wildlife habitat conservation on nearly 2,000 acres along the Mississippi River. The area is known as the Mississippi River Northwoods and was the largest remaining stretch of the Mississippi River unprotected from development in north central Minnesota. The land connected with other properties to provide a nine mile stretch of waterfront that protects eagle and red-shouldered hawk nests and provides critical habitat along the Mississippi River Flyway, used by 60% of North America’s migratory birds. In addition, the lands provided perpetual public recreation benefits for hunting, fishing, wildlife viewing, hiking and canoeing.
In another landmark multiparty conservation exchange, over 9,400 acres of PotlatchDeltic land was part of a series of exchanges with TCF that enabled Ecosystem Investment Partners (EIP) to acquire about 22,000 acres in the Sax-Zim Bog area and establish what was, at the time, the largest wetland mitigation bank in the country. The transaction resulted in further land swaps with St. Louis County and the Minnesota School Trust Lands. Ditches for farming had drained the original wetland and through ecological restoration, habitat was re-created for northern peat bog native plants and animals. The Environmental-Real Estate restored wetlands also benefited wildlife like moose, Connecticut warblers, great gray owls, boreal owl, and northern hawk owl. The wetland mitigation bank is adjacent to Minnesota’s Sax, Fermoy and Zim Wildlife Management complex which is protected and managed for sharp-tail grouse and sandhill crane.
Conservation transactions have also included tribal governments in an effort to consolidate tribal ownership within reservation boundaries. Established relationships with tribal leadership created an open exchange of ideas and strategies that produced desired land ownership exchanges. Direct sales to tribal governments from the Fond du Lac, Bois Forte, Leech Lake and White Earth bands enabled consolidation of tribal ownership within reservation boundaries to achieve objectives such as enhanced tribal hunting and gathering, wild rice lake management and other tribal social and conservation goals.
Conservation strategies can also include keeping forests from being converted to non-forest uses, which can be a significant risk in Minnesota. Conservation outcomes ensure that ecosystems stay intact, protect clean air and water, and maintain habitat for wildlife and provide recreational opportunities, while also providing sustained economic benefits including local jobs. In 2020, we completed the sale of 72,440 acres of forestland in 14 counties in northern and central Minnesota to TCF18 through its Working Forest Fund®. Called Minnesota’s Heritage Forest, the transaction is one of the largest land conservation projects in recent state history. The land sold includes approximately 31,600 acres located within the reservation boundaries of two bands of the Minnesota Ojibwe Tribe – the Bois Forte Band and Leech Lake Band. TCF will continue to manage these lands as sustainable working forests under SFI certification and continuing traditional recreational uses. TCF’s purchase will provide time for the development and implementation of permanent conservation strategies and sustainable management outcomes with the goal of transferring ownership to public and tribal entities over the next decade. These projects are just a few of many we have completed in our efforts to get the right lands in the right hands as we finish our land sales initiative in the state. Reflecting on our land ownership that spanned decades in Minnesota, we can see the tangible results of our relationships with many conservation partners that will leave a legacy in Minnesota.