Tejon Ranch reaches deal with environmental groups

BAKERSFIELD
May 8, 2008 10:11am

Part of California’s largest single piece of land in private hands – the 270,000-acre Tejon Ranch in Kern and Los Angeles counties – will be blocked from commercial development in a deal announced Thursday between Tejon Ranch Co. (NYSE: TRC) and several major environmental groups.

The agreement with the Sierra Club, the Natural Resources Defense Council, Audubon California, Planning and Conservation League and the Endangered Habitats League would result in the permanent conservation of a significant portion of the ranch’s landholdings while guaranteeing that the signatory environmental organizations would not oppose the company’s development plans for approximately 30,000 acres located on the western edge of the ranch, the company says.

That development includes the planned communities of Centennial and Tejon Mountain Village, and a development project at the base of the Grapevine in the area adjacent to Tejon Industrial Complex.

“Without a doubt, this agreement is good for the company and its shareholders,” says Michael Winer, portfolio manager for Third Avenue Management LLC, the company’s largest shareholder, and member of the Tejon Ranch Co. board of directors.

“It’s the key to unlocking the value of Tejon Ranch. By removing the potential obstacles that have plagued similar development efforts in California, we’ll be able to move ahead with the entitlement processes on our current development projects in a much more timely fashion,” Mr. Winer says.

The agreement calls for Tejon Ranch Co. to commit to phased conservation over the next several decades. Through a combination of dedicated conservation easements, either initially dedicated or tied to project approvals, and designated project open space areas, Tejon Ranch Co. will permanently protect approximately 178,000 acres.

The agreement also lays the groundwork for the purchase, at a price determined by a state appraisal process, of an additional 62,000 acres of ranch land, resulting in a total of 240,000 acres of conserved land. Under the agreement, the ranch will also be able to continue with its historic revenue producing activities on those lands.

“Our vision has been to preserve California’s legacy and provide for California’s future, and this agreement does exactly that,” says Robert Stine, president and CEO of Tejon Ranch Co. “The agreement we’ve reached is good for conservation, good for California and good for the company and its shareholders.”