The first thing visitors notice when driving through the iron gate of the 972-acre Circle H Ranch just west of Missoula is an emptiness. Large earth-toned homes rise up from the rolling hillside, but after the first few "clusters," the roads turn empty and abruptly end. Circle H developers originally planned 76 upscale homes here at the portion of the development called "the Ranch," a gated enclave that lies two miles from Lolo National Forest. Only 24 were built. Those homes sold for upwards of $750,000 at the real estate market's peak. Today, they are valued at roughly $300,000.
To the south of "the Ranch," back toward Interstate 90 along Butler Creek Road, an open gravel pit sits where developers said nearly 20 years ago that they would build an equestrian center. The stables never came.
Farther south, inside Circle H's proposed "West Pointe" subdivision on Macarthur Drive, there's more empty space where homes were supposed to be built. The hillside is exposed not far from a downslope home; a retaining wall was never constructed, leaving the adjacent house vulnerable to soil erosion. Signs advertising lots and homes for sale dot the snowy ground.
Cal Pickens stands inside the living room of a house on Macarthur Drive and, gesturing at the panoramic view, talks up the development like he has so many times before.
"On a clear day, you can see to Idaho," he says.
The Circle H Ranch owns this home. Pickens, a 58-year-old attorney based out of New Mexico, uses it as his Missoula office. Over the years, he's acted as a real estate pitchman and an advisor for the Circle H developers, primarily the New Jersey-based Circle H managing partner, Howard F. "Buddy" Seale.
"My relationship really is an arms-length advisor to him," Pickens explains.
On this chilly afternoon before Christmas, Pickens wears a light purple shirt with suspenders and a flower print tie. His mustache is tidy and his white hair combed back. Pickens, who says he owns property in several states and one foreign country, offers a primer on the interpersonal dynamics among the Circle H stakeholders before launching into the nitty gritty of the development's financial problems.
"You're not going to make friends being involved in this," he says. "It's so polarized that everybody thinks there's a side—there is one side, and there is no other side."
It's natural that there would be strong feelings. Circle H homeowners and investors have lost a significant amount of money and equity on the development. Pickens, for one, says he has cash in the project, though he won't disclose how much, aside from saying that it's "quite a bit."
He's just one of many. The story of the Circle H involves a convoluted paper trail that includes multiple lawsuits against developers, one felony theft prosecution, thousands of dollars in back taxes owed to Missoula County and an alleged securities fraud of historic proportions.
All of that has culminated with Wells Fargo now moving to foreclose on the Circle H. The bank says the development defaulted on a $5.7 million loan in 2009. With fees and interest, the Circle H owes more than $9.5 million. If the partners don't come up with the cash, Wells Fargo says in its foreclosure filings that it wants the property sold at auction.
There's more to the story of the Circle H than just unsavory financial dealings, however. The embattled development reveals a cast of characters chasing big dreams that have now been tainted by broken promises.
"It's too bad," says Circle H investor Ralph Swinburne, "because it could have been the greatest story in western Montana."
During the Great Depression, Howard Raser came to Montana with cash earned working as an auctioneer selling off properties that had been foreclosed on in Iowa, Nebraska, Oklahoma and Kansas. His goal when he reached Big Sky Country was to build a ranch where he could raise Appaloosa horses.
Originally from Nebraska, Raser stood a lean 6 feet 1 inch tall and, with his high cheekbones, cut a handsome figure. His grandson, Jay Raser, says that people were naturally drawn to him.
"He had a twinkle in his eye," Jay says.
Charisma is a good quality in an auction house owner. Such men acted as the investment bankers of the day, charged with handling what was at the time many a Montanan's most important investment—livestock.
Howard Raser first settled in Bozeman before making his way in the 1940s to Missoula, where he bought the Missoula Livestock Auction Company. He ran cattle across multiple county lines and, over the years, grew a livestock empire.
Part of that empire included a sprawling property west of Missoula blanketed with lupine, camas and bunch grasses. Raser saw it as the perfect place to fulfill his dream of continuing the Appaloosa horse bloodline. But a stroke in the mid-1970s made it harder for him to raise the horses he loved and tend to his businesses.
After Howard Raser's death in 1984, the ranch went to his three grandchildren. When the family opted to sell eight years later, Jay Raser, who is an architect and had served for several years on the Missoula Consolidated Planning Board, helped oversee the transaction.
"One of the first people that wasn't local, but out of state, that was interested in this property was this group out of New Jersey," Jay Raser recalls.