The Texas Parks and Wildlife Department has decided to end its half-yearlong effort to reclaim land once used for decades to house Fairfield Lake State Park using eminent domain — after an appraisal valued the property at more than four times higher than earlier this year.
The department issued a statement Tuesday saying it no longer plans to pursue the acquisition of the property housing the 5,000-acre state park. The decision was made after three Freestone County residents, appointed by a judge, set the value of the property at $418 million. The department said the property was worth $85 million. Meanwhile, the property was bought by an affiliate of Dallas-based Todd Interests in June for $103 million.
Representatives with the Freestone Central Appraisal District and the Freestone County District Clerk's Office were not able to immediately provide more information to CoStar News about the appraisal process and judge-appointed committee.
Having the judge-appointed commission value the Central Texas acreage at four times what another buyer paid for it six months ago raises some serious questions, said James King, director at King Land & Water, who has decades of experience brokering land throughout Texas.
"Common sense tells you that was a ridiculous appraisal," King told CoStar News. "If this is what the land is worth, how does the seller feel? If they sold it to this developer at below-market value, it could be something the IRS would be interested in to see if there's any fraud and what the property is truly worth."
This appraisal was likely completed in a "very subjective process," and it also would be interesting to see whether the appraisal would be used for tax purposes, said King, who was not involved with the deal. The United States has been cracking down on "bogus appraisals" that have been coupled with charitable deduction benefits with various conservation easements, King said.
"The IRS has clamped down on the appraisal process, but there's some stink here that needs to be looked at," he added.
Shawn Todd, who founded Dallas-based Todd Interests, did not immediately respond to an interview request from CoStar News. Todd Interests is the property owner through affiliate FLG Owner. In July, Todd began developing a luxury residential development and golf course on the acreage, which sits about 100 miles southeast of downtown Dallas.
Prior to Todd's acquisition of the acreage, a Texas ranch company had been marketing the property totaling more than 5,000 acres for $110 million on behalf of Vistra, the Irving, Texas-based parent company of TXU Energy and Luminant. In the marketing materials, brokers touted it as having the largest private lake in Texas.
David Yoskowitz, executive director of Texas Parks and Wildlife, said the department recognizes the importance of conserving the state's natural resources and providing recreational opportunities for Texans, but it "must also responsibly manage the state's fiscal resources" to maximize the benefit of its parks for all Texas residents.
In making this decision, the department said it "does not intend to exercise its power of eminent domain in the future" to obtain the property once housing Fairfield Lake State Park.