Investment exec buys lakefront land for $30 million

Dimensional Fund Advisors' Booth to build private residence, preserve most of area.

Thursday, May 03, 2007

David Booth, the top executive of a large California money-management firm that's moving its headquarters to Austin, has purchased about 45 acres off RM 2222 for $30 million.
Booth, 60, chairman and chief executive of Santa Monica, Calif.-based Dimensional Fund Advisors, and his wife bought the coveted undeveloped parcel with wildlife, birds and waterfront views in March and plan to build a house there.

The land sits where Bull Creek empties into Lake Austin. It once was part of the R.G. Mueller ranch and has frontage along Lake Austin and Bull Creek. Adjacent acreage is still in the Mueller family, after whom the former Robert Mueller Municipal Airport was named.
The land alone sold for twice the list price for the most expensive home currently on the market in the Austin area.

"It is one of those pieces that every developer in town has looked at at one time, because it is such a beautiful piece of property," although one that would be expensive to develop, said Mark Sprague, a partner in the Austin office of Dallas-based Residential Strategies Inc., a market research firm.

The seller was 4-D Partners LP, a Texas limited partnership. Austin attorney Rick Reed said he represented a party in the sale and couldn't comment, citing a confidentiality agreement.
The land has changed hands three times in the past few years.

Booth heads a firm that manages $143 billion for major institutional clients.
In addition to a home in Horseshoe Bay and an 8,500-square-foot house in Los Angeles' swanky Brentwood neighborhood, the Booths also bought a house off Westlake Drive that they are renovating. It will be ready in July. The family — Booth, wife Suzanne, son Chandler, 9, and daughter Erin, 16 — will move to Austin permanently in the summer of 2008.

Booth, a birdwatcher, said he plans to keep as much of the land as possible in its natural state. In the evenings, Booth said, the land gives rise to a "cacophony of sounds," from bluejays and cardinals, yellow-bellied sapsuckers and turkey vultures. He said deer and other wildlife are on the land, half of which he said is flat pastureland, with the rest sloping woodlands thicketed with cottonwoods, juniper, cedar, oak and elm trees.

"It's breathtaking. It's just got everything," Booth said. "It's the kind of piece of land you don't expect to find in a city these days." Austin attorney David Armbrust represented Booth in the purchase.

"It's a pretty significant acquisition, because it's really one of the last undeveloped parcels, and certainly the largest undeveloped parcel, along Lake Austin inside 360," Armbrust said. "It's one-of-a-kind. There's nothing that even casts a shadow."

The land is valued at $1.2 million on the Travis County appraisal rolls, which indicate that the previous owner paid taxes on only $49,251, largely because of a wildlife exemption.
Armbrust said Booth plans to file a wildlife management plan for the land with the Texas Parks and Wildlife Department, which Armbrust said would entitle him to keep the exemption. Such wildlife plans restrict portions of the land from development and help existing species on the land "thrive and survive," Armbrust said.

Booth said he has hired an arborist to care for the trees and improve the health of some that need "TLC." He also plans to hire a botanist and other consultants to study the land and to familiarize himself with its features.

"I want to do the right thing by the land and figure out what that is," Booth said. He would then come up with a master plan that would include where to build the house, which could take three or four years to complete, he said. Booth said he is not aware of any endangered species on the land.

As a high-profile parcel, Armbrust said, "it could have been developed very intensely into a bunch of condos, but he (Booth) is going to be a good steward of the land and tread lightly on it."
Other than a building permit and a permit for a dock, Armbrust said, the property, which is in the city limits, will require no zoning change and "is basically approved for what he wants to do on it."

Booth said he hopes to "do a little fishing off the dock," something he can't do in L.A. Booth would not confirm the sales price, although he said it was "a bigger number than I ever thought I could spend on a property." He has not yet hired an architect to design the house, but he said it will be built in a private area, away from the lake.

"If you have a good view of the lake, it means people have a good view of you," said Booth, 60.
Roy Butler, a former Austin mayor, co-developer of Avery Ranch and president of Capitol Beverage Co., said he seriously considered buying the property about five years ago.
Although it is beautiful, Butler said, "it was awfully pricey back then," and he opted not to buy.
Sprague said land along RM 2222 has gone up in value quickly. And with "only so many infill pieces on the lake that are that beautiful, it will go nothing but up in value."

As for Booth's land, Sprague said, it is "really special that somebody can buy that pristine piece of property and protect it."

In addition to Booth, several Dimensional Fund executives have bought million-dollar homes in Austin in the past year. The company employs 62 people in leased offices here. Booth expects to have 150 to 200 employees by the time the company's new offices open. In 10 years, he said, the firm could employ 800 people here, or about two-thirds of its U.S. work force. The company will keep an office in Santa Monica as well.

Booth said his employees are loving it in Austin. Although he declined to say what the jobs pay, they are generally high-paying and include traders, investment advisers, money managers, accountants and lawyers.

Booth said Wednesday that a graduate with a master's degree in business this year can expect a starting salary of about $150,000 range. He also has said his firm will recruit heavily at the University of Texas.

The company: Manages $143 billion for institutions such as big pension funds and some wealthy individuals. Uses sophisticated financial models to guide its investments. Has 400 employees worldwide.

The move: DFA has 62 employees here and could have 800 within 10 years, including investment analysts and traders. Plans to move into an office complex being built at Loop 360 and Bee Cave Road.

By Shonda Novak
AMERICAN-STATESMAN STAFF