What It Takes to Develop Property in Colorado Mountain Communities | Ep 4

What does it really take to develop property in a Colorado mountain town, and why do some projects succeed while others never get off the ground?

In this episode of Real Estate in the Rockies, Ashley Kappel and Jessica Chariton sit down with longtime Salida resident, realtor, and developer Walt Harder to unpack the realities of real estate development in mountain communities.

With over 20 years of experience in both real estate and development, Walt shares what most people do not see behind the scenes, from navigating land use and zoning to identifying opportunities and managing risk.

This conversation goes beyond surface-level real estate talk and dives into how development actually works in places like Salida and across Colorado.

In this episode, you will learn:

• What real estate development looks like in mountain towns like Salida
• Why development projects are more complex than most people realize
• How zoning, land use, and local regulations impact what can be built
• What makes a property a strong development opportunity
• Why off-market properties can be some of the best opportunities
• The biggest risks and challenges developers face in Colorado

Ashley helps break down the legal and land use considerations involved in development. Jessica brings insight into how development connects to the local real estate market and community demand.

Walt brings decades of hands-on experience, offering a real-world perspective on what it takes to successfully navigate development in mountain communities.

Walt Harder is the owner and managing broker of Harder Real Estate and Development, LLC, and has been a Salida resident for over 20 years. Since moving to Salida in 2000, Walt has built a career that spans residential, commercial, industrial, and retail development across Colorado and beyond. With a deep understanding of both real estate and land development, he brings a unique perspective to identifying opportunities and navigating complex projects. Walt is also the owner of Timber Creek Ranch, reflecting his passion for land, space, and the Colorado lifestyle.

Links:
 Website: http://hred.co
Facebook: Walt Harder, Harder Real Estate and Development

Real Estate in the Rockies is the podcast exploring Colorado mountain real estate, housing, land use, development, zoning, community growth, and mountain living in Salida, Buena Vista, Chaffee County, and communities across the Rockies.

Hosted by Colorado real estate attorney Ashley Kappel and local realtor Jessica Chariton, the show brings together developers, community leaders, housing experts, investors, and local voices to break down the conversations shaping mountain towns today.

Whether you’re buying property in Colorado, navigating real estate development, exploring affordable housing challenges, or simply interested in the future of mountain communities, Real Estate in the Rockies delivers real conversations and local insight from the people living and working in these communities every day.

Subscribe on YouTube, Apple Podcasts, and Spotify for new episodes every week.

Connect with Jessica: https://jessicachariton.homesmartpreferredrealty.com/

Connect with Ashley: https://www.collegiatepeakslawandmediation.com/

Please share this podcast with anyone who is interested in Real Estate development, Community Conversations about living in Colorado Mountain Towns. 

Transcript

SPEAKER_01 0:00

Today we had Walt Harder on our podcast. He is well known in Salido for better or worse. And I think he'd probably be the first to admit that. So don't feel bad saying it. And we had a really interesting conversation with Walt.

SPEAKER_02 0:15

Yeah, talked a lot about misconceptions of developers and government regulations that slow developers down and make it more difficult. And a lot about affordability and the issues that mountain towns face with housing shortages. And what's the future of our community in the next 20 years? His outlook on that.

SPEAKER_01 0:39

We're excited to have you hear our conversation. And we hope to hear from you if you have questions or want to give feedback about the discussion that we have today. Welcome to Real Estate in the Rockies, a Colorado Real Estate podcast focused on Mountaintown real estate. I'm Mountain Capital, real estate attorney, and I'm Jessica Harrison, local realtor. And we're here to help you understand what's really happening in the Rockies. We're giving both legal perspective and real world experience so you can make smart and competent decisions in the Colorado real estate market. So you don't miss an share with someone who cares about the future of the communities.

SPEAKER_02 1:25

Because in the rummies, real estate isn't just about property, it's about community.

SPEAKER_01 1:34

Today we are here with Walt Harder. What would you title yourself as first and foremost?

SPEAKER_04 1:41

Development's my primary function. Yeah.

SPEAKER_01 1:45

Okay. And we're excited to interview him, and we're just gonna hop right into the questions.

SPEAKER_02 1:50

Yeah, thank you so much for being here. We really appreciate it.

SPEAKER_04 1:53

Honored, thank you.

SPEAKER_02 1:54

So tell us a little bit about what drew you to this mountain town and community and kind of what you've learned about markets like this that you know along the way.

SPEAKER_04 2:07

Um, I met my wife in Colorado Springs in 98 and married her a year to the day after I met her, and she's a Salida native.

SPEAKER_02 2:15

Okay.

SPEAKER_04 2:15

And uh we started coming to Salida and hanging out here in 98, 99. I actually ended up moving here uh late '99, early 2000 with the birth of my first son. And um, I had already gotten into real estate in the springs, but never signed up with a firm. And uh her father, Larry, who became like a father to me, um, hired me at first Colorado. And so that's how I got into real estate. All right within the first year, year and a half, um, because I was new, I had no clients. And I I needed to have something to list. Back in the old days, they used to pay 60% of the available commission to the listing agent and 40 to the guy that brought the buyer. And I thought that was grossly unfair.

SPEAKER_01 3:02

The buyer does all the buyer agent does all the work. Yeah, right.

SPEAKER_04 3:06

And so I thought, well, I got to get some listings. So I talked a couple investors into buying a 44-acre parcel out on County Road 125, and I subdivided it for them, and then I had 12 listings. That's how I got it in development. Okay. It was uh they made all the money. I made some commission, but that was it. And I was like, I want to I want to do this for myself. Sure. Insanely so that you you kind of draw back and say, is this really worth it? And um, due to the the regulatory environment and and what we suffer through here and trying to get things approved, it's it's coming to the point here and nationwide, uh the developers have just kind of thrown out their hands and said, Okay, when when things make a little more sense, we'll jump back in, but today they don't.

SPEAKER_01 3:52

This is a a sideways question, but I have to ask it because I feel like it fits here. How is that how do you think that's affecting housing costs?

SPEAKER_04 4:02

Well, it's obvious, right? It's a supply-demand thing. So if there's no supply, we don't have to be able to do that.

SPEAKER_01 4:07

Developers bring the supply.

SPEAKER_04 4:08

Right. Yeah. Yeah. And and and but we're the evil people in the community, right? Because everybody who got here wants what they have, and anything more is too much. So it it's you're constantly fighting a NIMBY mentality.

SPEAKER_03 4:23

Yeah.

SPEAKER_04 4:23

It never goes away. But everybody in this room and everybody listening to this is living in a home that was created by a developer. Period.

SPEAKER_01 4:32

Yeah. Good point. Yeah. I I think I should interject here too that the point of this podcast is not to try to be controversial, but to have these conversations so that we can hear many different perspectives. Yeah. And so I appreciate that perspective that that's part of growth and having a housing supply because it's not going to be a one here, one there, one there.

SPEAKER_04 4:59

But the process has become so arduous and more importantly, expensive, right. Uh, due to all the reports and studies and and so forth that are required to get to that point, that that supply is dried up. So not only do you have uh developers who are in the business of doing that pulling back, but what used to create a large part of our supply is gone.

SPEAKER_03 5:22

Yeah.

SPEAKER_04 5:22

Is it it's no longer tenable. Um as a developer, I think it's important for me to see both sides. Like you said, it may be controversial to represent one side, but the reality is that people want things that are safe, secure, attainable, um, attractive, that fit and all those things. And those needs I respect. And and I I don't I've never wanted to just willy-nilly do things that that may or may not be uh a good fit for the community. But uh the lack of trust between the two uh opposing sides ends up creating this regulatory environment that overreaches everything and and pretty soon you're you're subject to scrutiny from everyone. And then nothing gets a project. Yeah, yeah.

SPEAKER_02 6:12

And when you say the regulatory environment, you're talking about like land use codes, all the all the civicity planning and zoning planning that you have to kind of go up against it too.

SPEAKER_04 6:25

And the public themselves, neighborhood petitions, yeah, oh yeah, referendums, yeah. We're going through that now. It's it's it's interesting. I mean, it's uh it's all part of the gig.

SPEAKER_02 6:35

So tell us a story about uh like a development pro like bring something to life for us, our listeners.

SPEAKER_04 6:43

Yeah, well, and I should introduce John Diesel as a as a partner uh years ago. Um and he's a great man, a good, good, honest, good soul. And um back in oh nine, well, in 2004, I built the Valvoleen Quick Lube out on the highway. Okay, owned and ran that for 10 years, got an education, nothing else. And um but uh uh what came out of that was a desire to do some more commercial development. And so at the time, in 2007-8, right, things were really collapsing. Meekham's old Texaco out on the highway, and I think it was called the Apple Grove Hotel next door, both went bankrupt, and they were both held, uh, liens were held by High Country Bank and they foreclosed on them. So had this beautiful, almost two-acre parcel right in the middle of Highway 50 across from F Street available. Um, I tried to buy it from Larry, the bank president, and it turned out I was in uh conflict, well, not conflict, but uh Fred Lowry was trying to buy it at the same time. And Freddie and I are friends, we're friends. What a great man. I don't know if you guys got to know him. He was he was a gem of an individual. Okay. Um anyways, he had a better relationship with Larry than I did, and he bought it. That works in a small town, it works in a small town. Relationships are everything, yeah. It's not what you know. Um, so, anyways, uh Freddie ended up buying it and um and he cleared it, which was great because the the demo costs were going to be significant. And that was right at the time when Color was passed some laws about uh pulling a demo permit. Again, another regulatory, in my mind, overreach. Um, and he just leveled the whole thing one night and and hauled the scrap down to a piece of property he's got on the east end of the highway. Somebody, I guess, turned him in. And and he ended up having this big remediation bill to go through the scrap pile to find out if there was any asbestos containing materials, ACMs. Sure. And um, and he had to go through that and I didn't. So I was a little bit grateful. I was at the birth of my second, my my third child, my uh my second son, on May 10th, 2007, when the phone rang. Trent was about three minutes old. And I looked at my phone and I looked at Dixie, I said, It's Freddie, I gotta take it. So I ended up talking to him for a couple of minutes. We had been haggling over price, and we settled on, I think it was $763,500. He's the number that sticks in my head at the time for that piece of property. And and we kind of shook hands on the phone. We actually had to, I called the title company, showed them what we were doing a couple days before the closing. They said, Hey, we don't have a contract. I said, Well, I got an agreement with Fred. We're we're good. I got the money and we're gonna do the deal. I said, Well, we need a contract.

SPEAKER_03 9:26

Yeah.

SPEAKER_04 9:27

So I actually had to go put a contract. Fred, you could do a deal with a handshake. Right. And it was gold. Anyways, we put a contract together and got it done. So I built the uh Sherwin Williams, it was at the time Family Dollar and then AutoZone.

SPEAKER_03 9:41

Oh, nice.

SPEAKER_04 9:42

Um AutoZone was reticent to come. They were our first tenant, and the way we pulled it off was I had all the clients from my Valveline quickly, which I stole owned at the time, and their zip codes and the number of people that came. And I was able to prove the demography of Salida and the number with the traffic we pulled in. They bought it, and so we signed the lease with Ava Zone, and then the other two fell fell in into place. John built that for me. Yeah. So I hired John to build that, and we got to be friends. Uh, we had been friends prior to that, and we rode bug bikes together and so forth, but that really kind of cemented our relationship. And he saw the lucrative nature of that project and said, really should you know kind of team up. Sure. Well, then, and and this was this is the kind of the story of the creation was uh shortly thereafter, things had fallen apart for the the Vandevere ranch property at the east end of town, um, which Solida wanted to see developed. And so it's convoluted, but ultimately John and I formed a company to bid the development of the National Forest Service building. Oh Celaida formed their own company as a developer, internally ticked me off.

SPEAKER_01 10:57

Well, we'll have someone on to respond to that. Yeah, I'd like it.

SPEAKER_04 11:00

Well, I mean, we're competing with ourselves, right? They're using tax dollars to and and the unfair part of it was that as a a municipal entity, they didn't pay property taxes.

SPEAKER_03 11:11

All right.

SPEAKER_04 11:12

So part of the bid to the Forest Service is what's called a triple net lease. It includes lease payment, insurance, and taxes. Well, we had to add taxes because we're a private entity, and they didn't. And so they won the bid. Uh, it ended up costing Salida taxpayers several million dollars over the course of the next few years because of cost overruns, um, an ultimate sale and resale uh by a local citizen who bought the project at undervalued because the guy selling it had no idea what he was doing. It was it was just a mess. It cost us a lot of money, it was frustrating. But John and I had formed this company, worked together to create this bid, yeah, and and now we have this mechanism in place to say, well, let's go do some deals. And we did it.

SPEAKER_01 11:54

Yeah.

SPEAKER_04 11:54

And we've been doing that.

SPEAKER_01 11:55

So that was the impetus that made you get the ball rolling.

SPEAKER_04 11:58

Yeah, it really got um larger scale developments going because we had the development arm, the construction arm, a little money between us. Some we brought in investors initially to to to fund projects. We didn't, you know, real money. And that's how we got started. And it was just a ton of fun. And we've been, he's like a brother to me. Um, he leaves me alone, I leave him alone. I don't, I don't question what he does. He don't quit. There's there's just a deep trust that works for us, and so the partnership flourishes. It's been a huge blessing.

SPEAKER_01 12:30

Yeah, that's great to have a partner like that. You mentioned a couple of things during that story that I think go well into this question, and that is what is different about a small mountain market as opposed to like you could have possibly been a developer in Colorado Springs, but you're here instead.

SPEAKER_04 12:50

Early on, building that Valve Lean Express care, there's a story behind it, but but ultimately I could have spent the same, actually, less, it would have been cheaper to build that in Colorado Springs, and I'd had three times the traffic. But I love this town. I like being here. I didn't want to move, I didn't want to have to go go there and monitor it, anyways. Um, the cost of doing business here is higher, right? It's not as lucrative, so there has to be kind of a an innate dedication to to your community.

SPEAKER_02 13:22

To to want to know why it's not as lucrative.

SPEAKER_04 13:26

Just numbers.

SPEAKER_02 13:27

Yeah.

SPEAKER_04 13:27

Yeah, I think not as many people, not as many customs. There's not as many. We struggled that that that business became profitable somewhere around 28, 29 cars per day. It took us forever to get there. We'd have been doing that.

SPEAKER_02 13:41

Yeah, more people just just go through.

SPEAKER_01 13:44

Yeah.

SPEAKER_04 13:44

And the cost of doing the business was is the same last.

SPEAKER_01 13:47

Getting supplies, worker cost of cost of labor.

SPEAKER_04 13:50

Yes, that is one of the cost of living. Sorry. I go when I'm in the springs, hey to admit, I'll usually buy gas and from diesel down there because it's 70 cents a gallon cheaper.

SPEAKER_02 14:00

Yeah.

SPEAKER_04 14:01

You know, we there's a little monopoly up here, and that's just what we suffer through.

SPEAKER_01 14:05

Yeah, right.

SPEAKER_04 14:06

The privileges of being in the mountain.

SPEAKER_01 14:08

That's a good way to put it. So you brought something up, and so you're in springs part-time and here part-time. What what led to that? And I think I'll just say, be controversial here for a second. There's some talk around town that you're not really local and you're coming in from a city to do this or that. Yeah. So it's probably good for people to hear your history and learn more about you, but also where things now as far as being a Celidon.

SPEAKER_04 14:37

My wife was a swim coach at a high school that was a great swimmer. And so my kids, as they grew up, naturally learned to swim at the Clida Hot Springs pool.

SPEAKER_03 14:48

Yeah.

SPEAKER_04 14:48

Um, my oldest son turned out to be a phenom. I mean, he still holds records that are haven't been broken in whatever it's been, 15 years or so. Um, and he's a he's a great kid, but he's a really amazing swimmer. So he ended up um wanting to keep swimming, and the opportunities here were limited. Ultimately, there was a team in Colorado Springs that that really wanted him, and that was a little closer and easier. So he started going there. Well, it was boiling the frog. Uh, we ended up getting an apartment so she could stay down there three, four days a week. Um, so they were doing the commuting.

SPEAKER_01 15:22

Yeah.

SPEAKER_04 15:22

And then we picked up a townhouse. And it was like, well, this will be a little bit.

SPEAKER_01 15:25

Might as well buy some real estate. Yeah.

SPEAKER_04 15:27

And then the next thing you know, I saw this house, and that's the house we're in now.

SPEAKER_03 15:32

Okay.

SPEAKER_04 15:32

So I'm a commuter, I'm a dual citizen.

unknown 15:35

Okay.

SPEAKER_04 15:36

I've been here 26 years. I I am I am as dedicated and in love with this town as anyone who lives here. Um, I'm here anywhere from two to five days a week, and there from two to five, you know, it depends on the need. Um, it's an hour and 50-minute drive. Um, I can fly it in 25 minutes.

SPEAKER_00 15:55

I was gonna ask about that.

SPEAKER_04 15:56

Love to do that when I can. Uh oftentimes I'm hauling things back and forth so I don't get to fly. But um, yeah, I'm you know, call it what you will. I if if the fact that I have a residence there somehow detracts from my usefulness to the community, well then point out where I can change.

SPEAKER_01 16:16

Make a difference.

SPEAKER_04 16:17

And I'll and I'll look at it. Um, you know, I I love this town, this community, and I know it well. Um, I love working here, I love being here. And um, but that's that. I don't know, I don't know where the animosity comes from, but perhaps there's there's something most of those people who I hear that from came from some city somewhere.

SPEAKER_02 16:38

Yeah, or ghost range plants.

SPEAKER_04 16:39

Since I've been here.

SPEAKER_02 16:40

Yeah. Right.

SPEAKER_04 16:42

So why did Grafa?

SPEAKER_02 16:44

What what do you think are uh misconceptions about developers and maybe you in particular?

SPEAKER_04 16:50

Um that we're just greedy uh people who destroy the landscape, I guess. That's that seems to be the the predominant feeling.

SPEAKER_02 17:01

Yeah.

SPEAKER_04 17:01

And I I, you know, I'm a carpenter by trade. That's I'm I build furniture. That's that's my thing. So I like to create, I like things that are visually appealing. Um, I like to to change the landscape to the better when it's to the benefit of a community. Um I don't like to do things cheap or or or chintsey. Um, I like quality a lot. Um so I just do what I do. I'm a hammer looking for a nail. Um but I'm I'm not trying to hurt anybody in the process. Um, it's a necessary thing. And as you pointed out earlier, it's a supply-demand issue that creates the high cost of living here. And as it becomes more and more difficult to create that supply, um the prices are going to continue to increase, which, you know, theoretically benefits those here, but it makes it hard for people to live here.

SPEAKER_01 17:55

One thing I often remind people when I'm working with them in real estate is that 83% of Chafee County is public land. Yeah. And so the cost of land alone is what is causing a lot of the, I mean, besides the labor, the material supply, getting everything out here. Yeah, it's just a matter of our land is really expensive because there's a very limited supply. So something I'm curious about with your trajectory. This isn't on our question list, but came to mind. Someone asked, um, were you do you feel like you had an advantage or you were able to buy land when it wasn't so expensive that allowed for that to John and I bought the 16 acres where Angel View is now up on the Mesa there between 120 and 140 for a total of $850,000 in a contract we signed in 13, 14, something like that.

SPEAKER_04 18:53

Okay. And we thought we were getting our eyes poked out.

SPEAKER_01 18:56

Yeah. That's what I wanted to hear.

SPEAKER_04 18:59

Yeah, it's all relative. We never felt like we were stealing anything. Right.

SPEAKER_01 19:03

But in retrospect, we look at when you sell a condo over there for that much now. Right. Yeah.

SPEAKER_04 19:08

Okay. So it's it's uh, and I feel extremely blessed, lucky. Yeah. When I moved here, um, Dixie and I both had low six-figure jobs. We were doing well, and and we we thought we were gonna be dicks. And along comes our first son. Like, guess not. Okay, and so my entire philosophy about life change. Suddenly, it's like, well, I had to provide for this, this new soul. Yeah, and um, and that became everything, right? So moving here, we took my first year in real estate, I made $44,000. Big pay cut. We bought a uh $150,000 house out in Punch Springs, took on a mortgage that, which by the way, was the average price of a house around this year, 2008. We bought the house in uh we closed in 2000.

SPEAKER_01 19:57

Oh, wow.

SPEAKER_04 19:58

Yeah, we've been here 26 years.

SPEAKER_01 20:00

Well, this was right after you got married. Yeah. There's like a beginning started.

SPEAKER_04 20:04

And and then Sheridan came along. We're like, well, yeah, I guess we gotta go. We'll talk about the swimming thing in just a sec, but um, and how that how that evolved. But um, well, we'll we'll go to that. It doesn't that one doesn't matter. Sheridan was a great swimmer. We ended up uh being there a lot, but he ended up with a swim scholarship to a nice college out uh in the south. And um, and then my daughter, who we adopted, had a lot of special needs that there just simply weren't the services for here when they started on the spring. So that really pulled. And I don't mean to drag this back to that, but I think that's helpful to understand. Important. And then my third, my third child, my son Trent, who's in his first year of college now at Benedictine in uh Hatchison outside Topeka, Kansas, um, got a full ride. Uh lacrosse scholarship. We'd never picked up lacrosse yet. No, yeah. He's an I mean, he's one of their lead players as a freshman. Wow. So um opportunities that that we didn't have. But the beauty is that we're rooted here as well. So they they also get the beauty of a mountain town experience, the outdoor experience.

SPEAKER_01 21:13

I, you know, I love to hunt and fish. I know when we moved here, Timber Creek Ranch was like people were trying to shut it down, and what like water issues were a big deal. So let's hear your side of the controversy. Because I think a lot of times what's interesting is in um like county or city meetings, we hear from the public and we sometimes hear from people from your organization, but maybe not the the bigger picture. What's your perspective on that particular development? Water specifically, what yeah, I'd like to hear about the water.

SPEAKER_04 21:49

How much of a problem that really was? So yeah, we live on the dry union aquifer, which is deep and wide. Um, you start hitting it at about 80 feet, 200 feet on the valley floor. Um, and a study was done of that aquifer back in um the mid-2000s, like oh four or five, somewhere else. Joe uh DeLuca was county commissioner, probably one of the best we've ever had. Um, and he commissioned this study to found out how much water is there? What do we really have?

SPEAKER_02 22:20

Right. Yeah.

SPEAKER_04 22:21

And it's it's a a very well recharged aquifer, so it's not sealed like the like the blue clay down in the San Luis Valley.

SPEAKER_03 22:28

Okay.

SPEAKER_04 22:29

Um, it recharges very well, it's very full. Um, overflow runs into the Arkansas, and at the time it was it was understood to be full. And so I'm able we're able to know how well that aquifer is doing every time we punch a hole in the ground.

SPEAKER_01 22:48

Because of the well that you hit.

SPEAKER_04 22:49

Where do we hit water? What's the flow? And so there's a tremendous amount of water underneath there, no, no lack whatsoever. Um, and thanks to the Upper Arkansas Water Conservancy District having created um the water plan that we have for this whole valley, we're able to properly store and account for water and buy it as needed. So the issue is people who don't really understand that or don't know what our water situation is in depth or or in in in true form, um, think that every time we punch a hole in the ground, we're we're gonna dry up their well and we're gonna run out of water. And it's just not the case. We're very, very blessed in this valley to have plenty of groundwater.

SPEAKER_01 23:35

When you think about Celida 10 years from now, 20 years from now, and I'll and I will say that's one of the things I hear about you that's controversial, is like, well, he cares about right now, but are you looking towards Celida's future and developments like that that you know need maybe 10 to 20 wells? Like, how do you see that going for the future of Solida? You think we'll be okay continuing to create developments like that? Or do we need to be working as a city to build the infrastructure out further for um like city water? Yeah, what what's your thought? What's your thoughts on that?

SPEAKER_04 24:13

Yeah, that's a good question. So there's a big difference between surface water and and groundwater, right? A sustainable water use system between us, we have we're we're surrounded by about 350 acres of state land at Timber Creek, which preserves those views in perpetuity. Um we also created about 100 acres of our own conserved land, also preserving those views, and secured the water to keep that irrigated.

SPEAKER_00 24:38

Okay.

SPEAKER_04 24:38

So long, expensive, arduous process, especially with the state water commission, um, but but got that handled. So the city of Salida in can't remember the year, but it was in the 2000s, somewhere in that 567 range. Um, we had between these two the absolute best city planners or administrators ever, Julie Schmula initially initiated the purchase of the Vandevere water.

SPEAKER_03 25:08

Okay.

SPEAKER_04 25:09

And um matter of fact, my father negotiated the other side, and I helped him with the contract from Glenn Vandevere to buy that water, which at the time looked like a huge I mean, a lot of people thought it was folly to do this, but it was one of the smartest things Soledad ever did. We secured more water than we could ever potentially use, in my estimation. Looking at how much we have, how much is reserved. We're currently leasing to Pueblo. This town could triple in size, and we've got the water.

SPEAKER_02 25:37

Really? But not BV, right?

SPEAKER_04 25:39

BV is a whole different story. Yeah, they were not as as forward-thinking as as we were, and and thanks to Julie for that.

SPEAKER_02 25:48

Um that's comforting to hear out loud. It is, but it's interesting to Yeah.

SPEAKER_04 25:53

BV is in a much different situation. It didn't, they didn't keep buying water, they never saw it cat happening. Yeah, I mean, it really was like BV went nuts. For it for years and years, BV was a 15 to 20% discount under Solita Real Estate.

SPEAKER_02 26:05

Right, right.

SPEAKER_04 26:06

Yeah, now it was the backwater.

SPEAKER_02 26:08

Right.

SPEAKER_04 26:08

Now it's the opposite.

SPEAKER_02 26:09

Yeah.

SPEAKER_04 26:10

Um, we did a deal in Solida, John and I. We bought the Adobe Village uh apartment complex, 32 units. We paid 100 grand a unit and demoed them, you know, gutted them, refitted them, and uh started to sell them. And I think our first sale was like 275. So it was a good deal. When we were done, they were selling for 400. The first two sales we did were to a Denver and a Boulder realtor. We advertised everywhere on these things, and they'd come up the Highway 285 corridor and go, Oh my god, I don't have to drive I-70, and I can get into the mountains. Sure. And so the realtor, yeah, right?

SPEAKER_02 26:51

Yeah.

SPEAKER_04 26:52

It's like this is amazing. Yeah. And and I I swear, those that was the day that we kind of hit the map. B V got discovered. And and the Denver, I mean, Denver has what, three times the population of Springs. Springs is is what moves up here. I I'd say that majority of our sales come off the front range.

SPEAKER_01 27:09

Yeah, people buying here. Yeah, I would agree with that. Right.

SPEAKER_04 27:12

So um BD being on the 285 quarter, which now is even more congested than it ever was, um, is what drove that. BB didn't see it coming. They're trying to catch up now. Water rights are expensive, hard to find, difficult to transfer, all the stuff. And uh John and I have a project up there that's hung up on water again.

SPEAKER_03 27:32

Yeah.

SPEAKER_04 27:33

And so it's it's a real consideration. But to slightest benefit, we we were very forward-thinking that um volume of water is not an issue. Okay, and boy, we should charge a lot for it.

SPEAKER_01 27:46

Is there someone we could have on here that would contradict that statement?

SPEAKER_04 27:50

Yeah, um, you know, I uh Bill Almquist, the city planner, would be great. He he would have some current stats on that and current numbers. Uh great guy. I think he's I think Bill has been one of the better planners we've ever had. Yeah, he's my yeah, really like him. He's he's he's a pleasure to work with, even though I may not like the answers I get or the or the stumbling stumbling blocks that we run into in development, but uh but Bill's a good guy, so maybe he would be and forward thinking. Yeah, yeah. Very, very much so. And and I am too. I mean, I can't, you know, I'm not I'm not uh, you know, get it done, get out, and move on and and leave it alone kind of guy. John and I have been we committed to the city of Salida a number of years ago. The way that just somebody in the city of Salida government interpreted the water code for multifamily was incorrect. And it took me 12 years of showing up to meetings and whining about the way that they allocated water for multifamily uh projects, finally got some traction, and they changed it so that you can buy the volume of water needed for like a 12-unit apartment complex instead of having to pay a residential water tap and sewer tap for every single unit, which made it impossible to build multifamily. But at the same time, city council, city planners, studies are all showing you guys need apartments.

SPEAKER_02 29:12

You need rental houses. High density houses desperately.

SPEAKER_04 29:16

And I said, guys, we can't build them. You with hamstring. We're we're 20 back at the time, we were $25,000, $30,000 of expenses before we turn to shovel the dirt. And you've got to be in an apartment, you know, usual 10%. Well, if you're getting $1,500 a month for a rental, you gotta be able to build that thing for $150,000.

SPEAKER_03 29:35

Right.

SPEAKER_04 29:35

And so when $30,000 of it was already eaten up in fees and expenses for water sewer, you never get there.

SPEAKER_00 29:40

You can do it.

SPEAKER_04 29:41

So we finally overcame that hurdle. And John and I committed that if they would correct that, we would build 100 units as quickly as we could, ideally in five years. Um, we're up to uh almost 50 now. And we have another 50 on the actually, we have another 60 on the planning table now that we should be able to build out in the next five years. And and we've held these. We we don't we haven't sold them. We built them, hold them, and we own these apartments. And that's our deep and long commitment to this town. We want to we want to see it prosper. And if we do, it doesn't, we don't.

SPEAKER_02 30:14

So tell me a little bit more about that. I mean, I don't know if you know that I was the executive director of the housing authority for a while. So affordable is kind of a big issue on my radar. Um, I mean, so you're talking about building apartments and multifamily for long years to come, but are you deed restricting them so that people can afford them?

SPEAKER_04 30:36

No and no.

SPEAKER_02 30:37

Tell me more.

SPEAKER_04 30:38

There deed restriction is a is a death knell. It's it's a terrible idea, I think, unless it's publicly owned. If you want to have something publicly owned, this is a great topic.

SPEAKER_02 30:49

Yeah.

SPEAKER_04 30:50

Um, do whatever you want with it. But I I am I am a free market capitalist uh libertarian who wants to see in case anyone was wondering. In case anybody was wondering, you wants to see as little government involvement as possible.

SPEAKER_01 31:07

No, yeah.

SPEAKER_04 31:07

And and the counter to that is always, well, if you let them run willy-nilly, they're just gonna build junk and and and it's gonna be ugly and all the rest of it. And that's that's not actually true. In a real capitalist world, it those things don't work. And so the capitalist knows what he's doing builds builds a product that is desirable, durable, and and uh marketable. Anyway, um, so I don't know if I reached out to you. Perhaps I had at some point. I've reached out to and and now to Margaret, who I think she's great, very smart woman. Um on an opposite end of the political spectrum than me, but but our goals are united.

SPEAKER_03 31:48

Yeah.

SPEAKER_04 31:48

And and so what we did with our first, we have a 24-unit apartment complex down at Confluid, which was the first larger one we built. And and I went to you or somebody.

SPEAKER_02 32:00

Was it was it Becky Gray or was it me?

SPEAKER_04 32:02

I started with Becky and then I ended up with you. That's right. I remember now.

SPEAKER_02 32:05

Yeah.

SPEAKER_04 32:05

We have some emails.

SPEAKER_02 32:06

Okay.

SPEAKER_04 32:07

And and I suggested this. I said, look, if you guys take a tenth of a percent ownership of this, it goes tax-free. Property taxes.

SPEAKER_02 32:15

Property taxes, right? Sales tax, too.

SPEAKER_04 32:17

Well, there's no sales. Um but property tax would be eliminated, right? And we're about $22,000, $23,000 a year on that. I still split it with you. You're gonna pay me that, let's call it $10,000 a year for the pain in the ass factor of having to deal with the state, which is significant. Because you will have to over and over again.

SPEAKER_01 32:36

Yeah.

SPEAKER_04 32:37

And I'm not gonna do it for free.

SPEAKER_02 32:38

Right.

SPEAKER_04 32:39

And you're gonna get a $10,000 credit.

SPEAKER_02 32:42

Oh, I do kind of remember this.

SPEAKER_04 32:43

Remember this?

SPEAKER_02 32:44

Yes.

SPEAKER_04 32:44

To use as you see fit to house people. So if if the market rent is $1,500 and you want to allocate that $10,000 however you want, you want to pay somebody's rent for nine months a year, or you want to subsidize somebody's rent $500 a month and do three of them, we'll set aside those units for your use so that you can provide affordable housing. And I think it was you that sent me over a 12-page document that wanted my last three years' tax returns, a personal financial statement, bank statements, on and on and on and on. I said, Oh no. No, no, I I'm offering you a gift. I'm not I'm not asking for anything. This I mean, I I'm happy to not do this.

SPEAKER_03 33:29

Right.

SPEAKER_04 33:29

But I but I think this is something we need. And and this is a way for you guys to put, you could you could put 10 units on the affordable list like that immediately.

SPEAKER_02 33:41

Well, there's all the bureaucracy of of the special limited partnership and all the rules.

SPEAKER_04 33:46

Okay, so there you go. So we are hamstrung by our own government to provide the things that our own government tells us we need.

SPEAKER_01 33:54

Yeah. That's I I don't dis that's a double negative. Don't just working on legislative policy committee this year for the Colored Association of Realtors, it seems like every extra tax bill that's introduced is in line with inhibiting affordable housing, but it's introduced by those that are wanting to create more housing. And it's like if you tax developers, builders on vacant property, for example, this is one of the ones that thankfully got shot down this year. You're they're not going to build here anymore.

SPEAKER_04 34:29

And we will not have houses for So you see that the intended consequences or the intended results end up with the exact opposite consequences. And it happens over and over and over again. And these people are well-meaning, they desire good things.

SPEAKER_02 34:47

Right.

SPEAKER_04 34:47

It's just they have uh, I think, a lack of common sense and a lack of business understanding.

SPEAKER_01 34:53

And so they the business part I would agree with. It's difficult to see that all play out in the world.

SPEAKER_04 34:59

Right. If you don't have any real world experience, which I would call common sense. And that lack ends up creating these regulations and rules and so forth that that countermand the intent. Yeah. Um yeah, boy, we can go on and on about that.

SPEAKER_02 35:17

Yeah, it's tough to navigate all that. I mean, I one of the reasons I'm not doing it anymore. I mean, it was it was so challenging to it's an ugly business, you know. And and I still I still feel very strongly about it, and I think that there's a need for it. And I I I you know, I I do think that affordability is is a is a huge issue, and it's almost impossible to build something affordably anymore to make it.

SPEAKER_04 35:46

Becoming impossibler all the time.

SPEAKER_02 35:48

Yeah.

SPEAKER_04 35:49

Every time a new regulation is enacted, a new fee is levied. Somebody has to be hired to manage and administer that. When when I got here, the city, the city of Salida was in the fire station, and there were three people there. And the mayor stopped by once in a while.

SPEAKER_01 36:07

I want to be the mayor then. Right. Yes.

SPEAKER_04 36:11

You go over to the tower, however you say it, building, and what do they have? A hundred and some odd. I mean, it's uh God, yeah. Every new regulation requires somebody to be able to administer that. You've got to pay them. Yeah, it costs more and more and more. Whereas the libertarian in me says, get your hands off of it and it will solve itself. And it always does. Give us an example. Um, deed restrictions.

SPEAKER_03 36:35

Yeah.

SPEAKER_04 36:35

The trouble with that is you limit the value of the property.

SPEAKER_03 36:38

Oh, yeah.

SPEAKER_04 36:38

So the developer looks at it now and says, Well, I I I'm gonna spend a million dollars to create a $1.3 million property, right? But it never moves past $1.3. Or, or I can never catch up with inflation. I'm not, I'm not, I'm not an inflation-adjusted asset anymore. It's not gonna bring the rents or the Yeah, my rents are limited, therefore, that's why you know the idiots in New York who are doing this rent control thing. I mean, it's just it's insanity by its very definition, doing the same thing over again, expecting a different result. Every single time rent controls, which is similar to, are imposed, it implodes. The owner no longer has an incentive to improve that property, maintain it, or or anything, or certainly build more. So supply is decreased, quality is decreased, everything implodes until it becomes slum. Happens over and over again. But yet, we got some guy in New York who wants to impose rent controls again, because maybe this time it'll work.

SPEAKER_02 37:37

Well, I mean, it's just so expensive to live here. I mean, I agree. You know, and there's people we need people in the service industry and the, you know, nurses and police officers teachers.

SPEAKER_01 37:49

That's what I was gonna ask you.

SPEAKER_04 37:51

Right. Well, I mean, uh from the other side, you would just hear the problem reiterated over and over and over again.

SPEAKER_01 37:57

Exactly.

SPEAKER_04 37:57

And we've proposed dozens of solutions. Nobody likes them. Deregulate, take away fees and expenses, which I agree with. I think that remove the impediments to the development. Right. Make make it affordable to do it again. What uh the expectation is that somehow, and I'm an altruist, but that I'm gonna do it out of the kindness of my heart and take a loss. Right. And I'm in the business of feeding my family. So that doesn't work either. And and maybe you can find an altruist out there who's willing to, but uh, you know, it's not me today.

SPEAKER_01 38:29

What is going on with the 5HC? Or is it it's the development 5HC?

SPEAKER_04 38:37

Yeah, we call it the back nine.

SPEAKER_01 38:38

Yeah, behind the golf course.

SPEAKER_04 38:39

Yeah, 15 or 16 eight.

SPEAKER_01 38:41

That would be so cool if it could be a back nine.

SPEAKER_04 38:43

Yeah, wouldn't it? Well, I mean, why don't we do that? We have a number of residents to the south of the development that don't want their review to go away. So um they're suing us. Uh it's kind of a quiet title action, uh a lawsuit against doing it, and um referring it to the electorate to down zone again or the electorate, meaning taking it to November. Yeah, taking it to an election. And what's ironic here, this is this has been an interesting one for for me. Um, the city originally zoned at R three, which is what they wanted.

SPEAKER_01 39:21

Right. I was at the city council meeting.

SPEAKER_04 39:23

Okay, yeah. I don't for I mean, give me R1. I mean, that's a sweet deal. Big watch, everything else, sell them for expensive. Well, I would have everybody goes home happy. I like R3, they didn't like, so we referred it, and the city said, Well, we don't want to go through the, I mean, an election is gonna cost them 30 to 50 grand. They're like, this is ridiculous. And nobody shows up for a special election except for people who are are ticked. So they're gonna show up and they'll win the thing. We get that. Um, so they brought it down to R2, and I redesigned the subdivision. Um, we've always committed to a lower density than we were allowed to, considerably lower. Like we're uh we were initially a third of what we could have built density-wise. And when the city kept pushing for higher density because they wanted that affordability.

SPEAKER_03 40:02

Yeah.

SPEAKER_04 40:02

And the more units we build now, thanks to this one-sixth law, we have to build these affordable units.

SPEAKER_03 40:08

Oh, within that. Yeah.

SPEAKER_04 40:09

And IH is the most ill-conceived thing I think the city's ever done. And everywhere that it's been done, it it limits supply, creates hardship, drives up the price of everything else. It's it's foolishness. But it's people want, they want to instead of letting a market solve the problem, they want to fix it. When you say the market solves the problem, like how, like, what is if there are buyers for $300,000 houses and I'm not impeded by all- you would build those. I can find a way to do it.

SPEAKER_02 40:43

Okay.

SPEAKER_04 40:43

But because of the regulation, because you can't find a way to do it. I can't. My fees, expenses, administrative costs, and so forth are far too high to achieve that price level because of all this regulatory environment we live in. If if that were removed, I'm gonna say it has to go away entirely, and I think achieving that balance is exceedingly difficult. Right. But we're we're so far to one side of it now that it's fully unachievable and won't be. Um, but if you remove those impediments, I'll find a way. I'm creative. I mean, this is part of the enjoyment of my job is figuring out how to solve those problems. And if there's this big market for $300,000 houses, and I know I could sell 50 of them if I could build them, I'll find a way.

SPEAKER_00 41:28

I wish we could test that. I do too. That would be so cool for here.

SPEAKER_04 41:33

It would be and it's entirely doable. But not not with and and it's it's not just local. I mean, it's it's oh, it's polar out of yeah.

SPEAKER_01 41:42

It's well, I would definitely say statewide right now, specifically. That's the way our state legislature is leading.

SPEAKER_04 41:48

We now are run into between uh over $15,000 per unit cost in just achieving the energy stuff that the city account the state now imposed. Everything has to be electric ready. Even if you don't build an electric house, you know, just electric furnace has to be electric ready, has to be set up for uh solar panels on the roof or a charger in the garage, all this stuff.

SPEAKER_02 42:11

And and that and now the fire code, uh 20.5, all those restrictions.

SPEAKER_04 42:17

It just gets harder and harder.

SPEAKER_01 42:18

Yeah. So think 5 HC will go through, it'll just be lower density, you redesigned it.

SPEAKER_04 42:24

Yeah, and and so but they're I last heard they're doing another referendum. So I um you know, and we're surrounded by R2 and R3. Yeah, so now they're asking for a zoning that's even bigger than what surrounds it, which doesn't matter. I don't know. At some point, it's the city's fight now. We're we're kind of throwing up our hands and saying you guys, you guys figure this out. We we have a zoning, we have you know certain rights and entitlements. Um we'll we'll build what you really want to see within certain constraints.

SPEAKER_01 42:54

I want to see those $300,000 houses. I can picture the sign by the neighborhood or the $1,500 rent.

SPEAKER_02 43:01

Yeah, $1,200 rent.

SPEAKER_04 43:02

We have $1,500 rent down at uh Conflict right now. Our our apartments there. Yeah, we we built those with a promise to keep them. Here's what's ironic, too, is uh Shafa publishes the the rents, you know.

SPEAKER_02 43:16

Yeah, the AMIs.

SPEAKER_04 43:17

AMIs, yeah. We're at or below 80% AMI really with no regulation, we're not deed restricted or anything else, but we're at or below 80% AMI right now. You know why? Because that's actually the market, yeah. And we want to keep them full. And we're smart enough to know that holding to a high rent results in vacancies.

SPEAKER_02 43:36

Yeah.

SPEAKER_04 43:36

And I'd much rather have somebody in there paying rent full time. Yeah, we're full all the time. Yeah, waiting list, as a matter of fact. And the same is true of Angel View, which is a little higher. Those are two bedroom, two bath, they're a little nicer. They got verandas, big views. Um, and so those rent for a little more, but they're not, we're not pushing the market. I'm not trying to get every last penny out of them. Rather have them full.

unknown 43:58

Yeah.

SPEAKER_02 44:00

Yeah, I'd be interested to compare the rents for like Jane's place to what you're what you're doing. Unless your less.

SPEAKER_04 44:08

I was shocked when they came out with shocked came out too. How how is that affordable? I'm below you, and I've got brand new units that are like sharing a bathroom or a kitchen.

SPEAKER_02 44:19

And they're probably bigger units than Jane's place are very small.

SPEAKER_04 44:22

Jane's place went so far over budget. So that was the issue.

SPEAKER_02 44:26

It was just how pricey it was.

SPEAKER_04 44:28

Public money went into that to subsidize that.

SPEAKER_01 44:30

Yeah.

SPEAKER_04 44:30

And and John built them. And I know we were having back office conversations about this. They said, John, if you'd given me that money, I could have built you twice as many units. Yeah.

SPEAKER_01 44:42

Well, that'll be controversial.

SPEAKER_03 44:44

Yeah, there we go.

SPEAKER_04 44:45

But that's what happens when government does things that the private sector should do.

SPEAKER_02 44:50

Right. I mean, I don't think the housing authority should be constructing apartments.

SPEAKER_04 44:56

Partners like who are offering you property tax bonuses. Right. And make it simple. Don't make it like this brain damage thing we've got to do. And let it let us work together. It's great. Could have been great. Hmm.

SPEAKER_01 45:11

Okay. So the the other conclusion question that I think goes along with that. I think something that's hard for people that have been here a long time is seeing all the land being grabbed up. Yeah. And what does that mean for the future of the valley or any mountain town for that matter? Like you look around and it's it's gonna all be houses someday. No more ranchy.

SPEAKER_04 45:36

83% of it won't be houses.

SPEAKER_01 45:37

That's true for here. Yeah, thankfully. Yeah, yeah.

SPEAKER_04 45:42

That's a blessing in itself, isn't it?

SPEAKER_01 45:43

It is. Yeah. So what if but looking forward to 20 years from now, um, what do you think Celida looks like? And is it a place you would want to live still?

SPEAKER_04 45:56

Yeah, I will. I'll still have a house here, without a doubt. Um that's a good question. And I guess I've thought of it a little bit. Because there is such a limited amount of land left, yeah, and and I think there are a very small number of developable, larger parcels left, yeah, that here's the kind of the sad truth is things are just gonna get expensive.

SPEAKER_01 46:22

That's what I think too. You know, more than they are now. People think it's expensive now. That's I'm like, you just want to get ready.

SPEAKER_04 46:29

Unless for some reason this area becomes really uh unappealing. And it could, with enough government fingers in the pot, you can make things so sour that people are like, yeah.

SPEAKER_01 46:42

Yeah. I think I really enjoyed the conversation. Rapid fire questions, Ashley. Do you want to ask? They're not hard.

SPEAKER_02 46:52

Land with a view or walkable downtown.

SPEAKER_04 46:55

Oh, for me personally, yeah. Or walkable. I love both. That's a tough one. Um, I mean, I love my office. I'm right around the corner there, and I'm real walkable, but I live on a place with huge views and a lot of land and nobody around me. So the answer is I like both, I'll tell you.

SPEAKER_02 47:12

All right, we'll let you. First job you ever had?

SPEAKER_04 47:17

Um mowing logs.

SPEAKER_02 47:20

Okay. Good entrepreneur job. Yeah.

SPEAKER_04 47:22

I was seven.

SPEAKER_01 47:23

Yeah.

SPEAKER_02 47:24

What would you do if money were no object?

SPEAKER_01 47:28

What kind of business will work? I'd give it away.

SPEAKER_02 47:32

That's a good answer. What is your personal motto? I think he said it during the interview.

SPEAKER_04 47:37

Do things that are hard.

SPEAKER_01 47:39

Yeah, that's right.

SPEAKER_04 47:41

I got that from Jordan Peterson.

SPEAKER_01 47:43

Yeah, I like him. Have you read his 12 Rules of Life book?

SPEAKER_04 47:46

I haven't. It's a good book. But I I became a member of the Peterson Academy, and I'm on my 10th class right now. Oh, cool. I love, I'm getting an amazing interview. A lot of the stuff, you know, the history stuff comes from his class. It's amazing. I would encourage you. It's the best 400 bucks you could ever spend. Okay. Peterson Academy.

SPEAKER_02 48:04

So along those lines, what's your favorite book or book you're reading now?

SPEAKER_04 48:09

Um I have two favorite books. One was Atlas Shrugged, and the other was The End of the World Is Just the Beginning by Peter Zion. And it was a fascinating discussion of geopolitical demography. Which I've become a student of demographics because of its predictive ability. Yeah. And it's an incredibly powerful tool. You asked what things are going to be like in 20 years. I mean, that's a that's a real question for a demographer, right?

SPEAKER_00 48:36

Yeah. Right.

SPEAKER_04 48:36

Um, so those are two of my favorite books. Of course, I Bible tops them. That's that's my favorite.

SPEAKER_02 48:43

All right. Okay. What is home mean to you?

SPEAKER_04 48:47

Wherever my wife is.

SPEAKER_01 48:49

Oh, that's great. That is great. I've never met her.

SPEAKER_04 48:52

She's she's a fool.

SPEAKER_01 48:54

She's never in Salida. She is. I'll say I'll come over to your office just to meet her. We'll have to be there to support everything that you're running.

SPEAKER_04 49:03

She does we have the best deal. Um great, great partnership. She is uh regional director for the Western U.S. for Cavi clothing. And so she travels a fair bit, um, lives on the phone and Zoom calls, but she is uh super busy, super smart, she's an amazingly smart um manager. She she manages people and events really.

SPEAKER_01 49:25

Cool. Yeah.

SPEAKER_04 49:26

Brilliant.

SPEAKER_01 49:26

Do you have any social media channels or anywhere if people want to?

SPEAKER_04 49:31

I have a Facebook page. It's just Walt Harder, and then I have um uh Heart of Real Estate Development. And my pleasure today, it's just enjoyable.

SPEAKER_01 49:43

This episode is sponsored by Heart of the Ruggies Home at Home Park Preferred Real City. We do real estate with Heart and the Heart of the Ruggins, and we serve Colorado Mountain communities working to help clients navigate real estate in these unique towns. Whether you're buying, selling, or exploring your options, our goal is to make every step feel informed, supported, and straightforward.