Dueling stories surround N.C. State's Hofmann Forest deal | Wake County | Indy Week

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Dueling stories surround N.C. State's Hofmann Forest deal



The sale of Hofmann Forest is so radioactive that both the prospective buyer—Illinois agribusinessman Jerry Walker—and the seller—North Carolina State University—are claiming that a controversial prospectus showing the property could be commercially developed is the other party's doing.

University officials have asserted that they had never seen the leaked prospectus outlining 9,000 acres of commercial development for Hofmann Forest. However, the buyer's representative claims the university saw those plans during a general exploratory study—a claim N.C. State emphatically denies.

Last week, the INDY broke the story of the Hofmann LLC prospectus, which shows parts of the forest would be developed for commercial and residential uses. Other tracts would be converted to agriculture, the document states. Tom Percival is the Lumberton-based consultant for the prospective buyer, Hofmann Forest LLC, which is owned by Illinois agribusinessman Jerry Walker. He plans to purchase the 79,000-acre property for $150 million. Percival said the development plans in the document "are renderings that were done many years ago by North Carolina State University as a general study and were not prepared by or for Hofmann Forest LLC." The prospectus was assembled in early 2013 to show Walker and current and prospective members of Hofmann LLC "all of the possibilities that the forest possessed in the early stages of forming the LLC," Percival said. Walker is the sole officer listed for Hofmann Forest LLC. Percival refused to reveal other members of the company, nor would he disclose who put the prospectus together. But he maintains that despite the contents of the prospectus, Walker does not intend to develop the land. "It was just a way to show potential and current members of the LLC one potential use of the property," Percival wrote in an email. He did not return several additional emails and phone calls from the INDY seeking more information. Brad Bohlander, N.C. State's chief communications officer, reiterated in an email Tuesday that N.C. State "had not previously seen and was not previously aware of the Hofmann Forest LLC document, the potential buyer's analysis of possible uses of the property, or that the potential buyer used this information in this format."

Bohlander said the prospectus does, however, contain information the N.C. State Natural Resources Foundation Inc., which co-owns the property, provided to multiple prospective buyers as part of the due diligence process. This includes maps, details about employee costs required to run the forest and a 2009 concept plan.

That plan was prepared by the Foundation and Weyerhaeuser Real Estate Development company, Bohlander said, "concerning potential uses of Weyerhaeuser's adjoining property and approximately 4,000 acres of the Endowment Fund property located to the south of Highway 17."

Weyerhaeuser Real Estate Development Company is a wholly owned subsidiary of Weyerhaeuser Company, one of the largest timberland owners in the world.

The real estate company operates in at least 10 states. Its southeastern headquarters is in New Bern, N.C. The company specializes in selling forestland in the eastern part of the state.

Bohlander said the Foundation and the company solicited preparation of the concept plan "as part of an ongoing effort to value this portion of the property. It was not created in connection with this sales process."

Hoffmann Forest LLC filed incorporation documents with the N.C. Secretary of State's office Jan. 30, 2013, nearly two weeks after Mary Watzin, dean of the College of Natural Resources, announced the N.C. State Natural Resources Foundation had voted to put the forest up for sale. The Foundation co-owns Hofmann Forest in Jones and Onslow counties with the N.C. State Board of Trustees of the Endowment Fund, making the forest state property.

Percival did not expound on whether Walker plans to convert part of the property for agriculture. However, he said earlier that Walker wants to diversify his operations with timber farming. The leaked documents say 70,000 acres of the forest could be converted to agricultural uses—50,000–60,000 of which could be converted without running into problems with the wetlands on the property.

Walker is the manager of Walker Ag Group, an Illinois-based farming empire with operations in at least 23 counties in seven states.

Bohlander said in an email that there is room for the buyer to pursue "agricultural endeavors" in the sales agreement, but that Walker is committed to preserving the legacy of the Hofmann Forest and allowing for the university to conduct research on the land.

"Throughout the sales process, N.C. State has negotiated in good faith," Bohlander wrote, "doing our best to ensure this sale will achieve the goals of preserving the legacy of the forest and allowing for the continuation of the current uses of the land, including opportunities for continued research. The buyer has made publicly clear a commitment to honor these outcomes, which is consistent with the sales agreement signed by both parties."

Opponents of the sale—including a coalition of professors, foresters, wildlife conservationists and land owners suing N.C. State to stop the transaction—say they think the sale has been rigged from the start.

Fred Cubbage, a forestry professor at N.C. State and plaintiff in the lawsuit, says prices for other forest land sold recently are "a good bit higher than those for Hofmann, and Hofmann is well-organized, roaded and managed."

Cubbage estimates that Walker could make up to $500 million on the forest, mostly off agricultural conversion, development and a lease with the U.S. military that is described in the sales agreement.

A Wake County judge last week denied the coalition's motion to temporarily block the sale, citing not enough evidence that the sale poses a significant environmental threat. She is considering a motion to dismiss the case, but opposition to the sale is gaining steam elsewhere. N.C. State's Student Government Association will vote Wednesday on a resolution to request university administrators abandon the sale, according to the student newspaper The Technician.

This article appeared in print with the headline "Who knew what and when did they know it?"

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