In 1970, Patrick Bates, the man who is widely considered the dean of western ranch real estate, began his industry education. He was a wide-eyed novice with no immediate ties to agriculture who seized an opportunity.
“I entered this business as a student. I had no agricultural experience, but I believe that actually worked to my advantage because I had no preconceived ideas,” said Bates, president of the Bates Land Consortium in Salt Lake City. “I had tasted neither success nor tough times in farming or ranching, so my judgment wasn’t colored by personal experiences or emotional ties.”
Through previous business dealings, Bates had established a relationship with Hod Sanders. Sanders, along with his wife Clover, founded a potato chip company in 1950. By 1970, they had grown Clover Club Foods into the nation’s largest privately held convenience food company.
Along the way, Sanders had purchased several ranches in the West including two near Pinedale, Wyoming, which he was looking to divest. Although Bates had never sold a ranch, Sanders called him about listing both places. Within an hour, Bates had secured an opportunity to sell them.
“At the time, I didn’t know anything about ranches. I only knew baseball,” said Bates, who as a scholarship athlete played catcher at Brigham Young University and eventually spent two seasons in the Los Angeles Dodgers minor league organization. “As a result, I asked a jillion questions and soaked it up like a sponge.”
The older man soon became a trusted friend and mentor. By the fall of that same year, Bates had sold both ranches. The transactions were significant not only because they were Bates’ first land deals, but they were unsolicited, an attribute that became a hallmark of Bates’ business.
“One of the great blessings of my life and career is that I’ve never solicited a listing,” Bates said. “They have either come from referrals or repeat customers.”
From the outset, Bates determined that he would be selective, only accepting listings that offer the potential to work for both his clients and for him. The Bates Land Consortium represents about 10-12 properties per year unlike larger brokerage firms that scramble to maintain much larger inventories.
“In the western states, deeded land that can be bought and sold is a relatively rare commodity,” Bates said, noting that in Utah only 17 percent of the land is privately held and with that figure rising to no more than 55 percent in the other states where he is licensed. “When something is rare and precious, there is a built-in appreciation for it.”
Being selective also keeps the work fresh and engaging, making it difficult for Bates to identify his most interesting deal.
“Because we limit the practice, every listing we handle is different,” Bates said. “If a property’s attributes, the people involved, or the challenges being addressed aren’t interesting, then the listing doesn’t end up on our inventory.”
Baseball Lessons for Life as told by Patrick Bates
Baseball can teach people a lot of lessons, but you have to consider the numbers. In major league baseball, the season is 160 games. A team can lose 50 or so and still make it to the World Series. Baseball is a game, where you can lose more than a few and still get the big win. It’s a sport for real people.
A hitter gets about four at bats each game, meaning he gets 640 at bats during the season. If he gets 210 base hits, then he’s batting .333, which as everybody knows is a heck of an average.
But take the numbers a step further. Every batter gets about five pitches per at bat, so they look at 3,200 pitches per season. Out of that, a good hitter harvests 210 base hits. That’s one hit for every 16 pitches.
So what did that teach me? A person has to go long and think long. You can’t get have “Strike three!” with the bat on your shoulder. You have to approach each and every at bat, thinking, swinging and battling for the win because you never know when you’re going to connect.
New challenges also provide Bates “with a healthy case of the butterflies,” he said. “I’ve always tried to operate at the highest levels with the highest attention to detail. I don’t know how to do it any other way –and frankly I’d be afraid to try. Complacency has no place in this business. ”
By design, the limited inventory also keeps the Bates Land Consortium staff small, allowing Bates and his two associates to concentrate on personal service and personal relationships.
“The biggest reward in this business is the win,” Bates said. “The win is helping people solve problems, whether it’s settling an estate, expanding their operations, or, if necessary, helping them sell graciously to meet other obligations. And I don’t care how many innings it takes to get the win. In my experience, going into extra innings makes you a better ballplayer.”
In addition to going extra innings, Bate is committed to going the extra mile, especially when it comes to gathering, organizing and presenting information about a piece of property.
“Having comprehensive, well-organized will help a buyer make a decision in a relatively short time,” said Bates, who suspects that on a percentage basis his firm has the shortest due diligence period in the industry.
He learned this lesson, which has served him so well, early in his career. A potential buyer was looking at a property offered by Bates. The buyer’s financing was being handled by Traveler’s Insurance Company. Bill Taylor, the senior lending officer, called and asked to tour the property as part of the company’s review.
During the showing, Taylor told Bates, “Before I leave, I want to teach you one thing: Tell the truth, the whole truth, and nothing but the truth. Then, if you’ve done that, you’ve earned the right to tell the truth attractively.”
The attractive, accessible truth is crucial because the buyer is not acting alone, Bates said. Normally, the buyer has an advisory team that includes an attorney, an accountant, a financial advisor, and, if the buyer is smart, his wife, he said, laughing.
Generally, when a buyer and his team are presented with a well-organized, complete set of facts, something important happens when they get about half-way through the document review, Bates said.
“Comprehensive, objective information not only gives clients the basis for informed decision-making, but it establishes trust,” said Bates. “Business travels at the speed of trust.”
Earning trust is at the core of all of Bates relationships, both business and personal. After finishing his stint in minor league baseball, Bates was returning home to southwestern Washington State. The trip took him through Salt Lake City, so he decided to reconnect with a young woman he had met earlier at Brigham Young University by asking her out to dinner. Her name was Anita Anderson.
When he called, Anita asked, “Where have you been for two years?” He told her. And she replied, “Well, are you done?” When he said yes, she agreed to the date.
The next morning, instead of getting on the train back to Washington as planned, he called Anita and asked her out for dinner again. She accepted.
On the third morning, after the cancelling the return ticket, Bates once again called Anita. This time the proposal didn’t concern dinner.
“I told her that I wasn’t going to go back to Washington,” Bates said. “She said, ‘Oh?’ and I said, ‘I’m going to spend a year in Salt Lake trying to prove to you that I’m the kind of man that you’ll want to marry.’” It worked. They have been married for 48 years, making Salt Lake City their home.
In the mid-1960s, the national economy was in the doldrums and Utah was particularly hard hit. Jobs were hard to come by. Bates applied to be a salesman at the two largest car dealerships in the city. The manager at the first dealership didn’t hire Bates telling him, “You wouldn’t be worth a damn.” The hiring manager at Ken Garff Oldsmobile asked, “Do you have a suit, a blue blazer and some gray slacks? We want to hire you.”
Unbeknownst to Bates at the time, Ken Garff was one of the three owners of Utah’s famed Deseret Livestock Ranch. Bates sold cars for two years and then went into real estate. Ken Garff noticed. When he and his partners decided to sell their 210,000-acre property, Garff called Bates.
“My phone rang and Ken said, ‘I hear you’re selling ranches,’” Bates said. “When I confirmed that information, he invited me to a meeting where he introduced me to his partners, David Robinson and David Freed.” Bates left the meeting with the listing in hand.
“In 1974, three-and-a- half years and 47 showings later, I sold the Deseret Livestock Ranch,” Bates said. “It was a big notch in my gun.”
Bates sold the ranch to a “citizen of the world who lived in Hong Kong.” The investor, who had British citizenship, graduated from the American University, taught jump school at Fort Benning and traveled the globe, spent a good deal of time in Utah enjoying the ranch. After nine years, he determined it was time to close that chapter of his life. He called Bates with the news that he wanted to sell the ranch. He offered Bates the listing.
In 1983, Bates sold the 210,000-acre property again. This time the sale took 60 days, he said.
“I still had all the information together, so it speeded things up considerably,” Bates said. “I keep every scrap of paper generated by every deal I’ve ever done because you just don’t know when you might need it.”
The opportunity to market the Bell Ranch also originated with a direct phone call to Bates, but it was a long, indirect route to the actual listing. In 2006, Bates got a call from the Lane family in Chicago, owners of the 290,000-acre property in New Mexico.
“They had a situation that required a Solomon-like solution,” Bates said. “It took me a year to come up with a plan that met their needs, but ultimately it involved selling the ranch.”
While the family embraced the plan, including the sale, they decided to “list the property with a firm that supposedly had a bigger Rolodex,” he said. But despite giving the listing to another firm, the family asked Bates to conduct every showing. He did in 2007, 2008 and 2009.
Originally listed at $115 million, everyone involved expected the transaction to take time, but after three years with no luck at the big-name firm, the family reconsidered. In January 2010, Bates received the listing. He closed the sale in August 2010.
“It was a significant sale,” Bates said. “Not everyone gets the chance to sell a ranch with 290,000 deeded acres.”
While selling large ranches is a significant accomplishment, Bates doesn’t consider these often record-breaking sales his greatest achievements. That accolade is reserved for his family.
“My greatest accomplishment to date — and forever — is my family,” Bates said. “My wonderful wife of 48 years…my two children who warm my heart every day…my grandchildren…they are the reason that I do what I do. No doubt, I love the ranch real estate game, but I play it because it allows me to take care of them.”
He continued, “You know the word ‘retirement’ scares the hell out of me. As long as my health remains good, my mind remains sharp and I can drive safely to and from the ranches that I need to see, I’m going to play the game and keep bringing people and land together.”
Why? Because land ownership is important.
“Real estate is as the word implies is ‘real.’ It’s not something based on a dot.com or something floating in a cloud,” he said. “It’s real property in the real world, a concept understood by kings. Remember, the El Camino Real, the way of kings? I think the men and the women who are wise enough to own land, whether it’s for production or for play, are assuming a bit of the crown.”
He continued, “Plus, land ownership provides an opportunity to form a partnership with the Lord to enhance something that is vital to us all.”
A Formula for Success
All P’s and No Q’s as told by Patrick Bates.
When it comes to a real estate transaction, I have a formula for success. It involves four P’s. The first three P’s go to the left of the equal sign and the fourth P goes to the right, so the formula looks like:
P+P+P=P
The first P is people: Do I like these people, regardless of whether they are buyers or sellers? Do they like me? If the answer is yes, then I move forward. If the answer is no, I don’t because if there is not a foundation that we can build a relationship on, then the deal won’t work.
The second P is property: Do I like this property? Does it have merit in the marketplace because of its beauty, its productivity or some other unique attribute? Is this property good enough and strong enough to provide the buyer with a built-in backdoor if he ever chooses to sell it?
The third P is price: Price must be realistic. I’ve been fortunate to set some price/acre and price/animal unit records, but I always determine whether or not I can meet or come very close to the sellers’ expectations in the marketplace.
The fourth P is paid: Will my sellers get paid? If they get paid, then I get paid.