Fortress Management LLC - Recent Deals for Evangel and Greenwood
I attended a meeting last night presented by Denny Reedy of Fortress Management LLC. He wants to help the Steeplechase neighborhood negotiate a deal for the price of 4% of leasing bonuses. Most of the audience seemed to want to jump on the deal, but I'm hesitant. He indicated his company negotiated the Evangel deal for over $10,000/acre and just recently signed the deal for Greenwood, getting between $18,000-$20,000/acre. Both deals were for 3 years with no options. He did not mention any other groups that they are working with, but his website (www.fortressmanagementllc.com) shows multiple groups he is working with. He stressed the fact that they are now obtaining bids from not 2, but 4 major oil companies; therefore, they are getting top dollar for the leases.
When questioned about how much time it takes to get your money, Mr. Reedy indicated that they stipulated 90 days in the Evangel leases, but now are using a 45-day period in their leases. I think most of the audience were seeing dollar signs in a short time and want to proceed.
I understand that there is more money to be offered if you go with a group. Also, you get a better price if you get bids from multiple companies. So why shouldn't we get more companies like Fortress to bid on our group? Does anyone have an opinion or information regarding a better "middleman" to make our deal with the oil company?
Today, I heard that one of the landowners that was included in the "Evangel deal" had received a lease that had different terms than what was originally agreed upon through Fortress. That landownder has not signed yet because of this problem. Could this be one of those "bait and switch" leases?
I'm having a hard time following the discussions here, so please feel free to send comments to me at sissy6206@yahoo.com. Please put "Shale" in the subject line.
I appreciate any help or comments.
When questioned about how much time it takes to get your money, Mr. Reedy indicated that they stipulated 90 days in the Evangel leases, but now are using a 45-day period in their leases. I think most of the audience were seeing dollar signs in a short time and want to proceed.
I understand that there is more money to be offered if you go with a group. Also, you get a better price if you get bids from multiple companies. So why shouldn't we get more companies like Fortress to bid on our group? Does anyone have an opinion or information regarding a better "middleman" to make our deal with the oil company?
Today, I heard that one of the landowners that was included in the "Evangel deal" had received a lease that had different terms than what was originally agreed upon through Fortress. That landownder has not signed yet because of this problem. Could this be one of those "bait and switch" leases?
I'm having a hard time following the discussions here, so please feel free to send comments to me at sissy6206@yahoo.com. Please put "Shale" in the subject line.
I appreciate any help or comments.
Tags: Steeplechase
Views: 166
Replies to This Discussion
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Permalink Reply by EASYMONEY on
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Everyone is cashing in on being negoiators. You will want someone to look at your lease and negoiate the best lease possible along with the highest bonus. Think about it, if 20,000 bonus is what you'll receive per acres, this mean each homeowner on an average will get 5,000 out of the deal. Four percent is 200.00. I'm sure you will pay an attorney more than 200.00 dollars to look at your lease. Also, there is so much information available to point where, when you do get your lease, you should take some time a carefully review it for yourself. If there is something you don't understand, get on the internet and research. I bet the ones who didn't have a negoiator got a bummer for their lease, even though they didn't have to give up a percentage of their bonuses. Overall, just pray and hope that you'll get the best deal possible. You know everyone is trying to cash in on this, and there are some that are honest and some that's not. We all can only hope for the best.
Lots of Luck.
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Permalink Reply by SBossierGuy on
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You have some valid points, but my main concern is a negotiator's qualifications. I understand a lawyer may be a good choice. But some of these guys are CPAs and I really question whether they know what is a good lease or not. How many negotiations does a CPA actually participate in? Seems like a used car salesman would be more qualified.
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Permalink Reply by KAS N1 on
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$200 is a great deal but what if you have 80 acres and you get $20,000 per acrea. You are paying him $40,000-$50,000 to get you the same deal. That seems outrageous to me.
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Permalink Reply by PM on
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Do you take less than 1 acre properties to auction or is this only for large properties?
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Permalink Reply by Snake Stewart on
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Isn't that what these other guy's are doing ? They turn your info over to their attorney who turns it over to auction house for sealed bids. Somebody please explain it to stupid ole' me ,how a guy is "negotiating" you the best deal if its freakin' sealed bids.I am bound to be missin' something, for people to be so excited about paying 2 additional fee's( negotiator & attorney ) to get a sealed bid ?
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The lawyer isn't free.
The "negotiator" isn't free.
The auction house isn't free.
You are correct, thats actually 3 entities that you would be paying.
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Hey snakestewart it might be worth it for people in my area because we don't have a hoa and the only offer we have had is $5500 from Twin Cities (still say it is best they can do), I was going to talk with some of my neighbors about this option. If we can get $15,000-$20,000/acre instead of $5,500 it would be worth paying a fee. I still need to look into other options. Does anyone have other suggestions? We live in Bossier City and can't seem to get a group together. We are in Old Green Acres, I sent a email a while back to Green Acres Place but never got a reply back so I feel we are too far from their area.
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Please don't confuse my response in the earlier post into thinking I am for bonus or royalty % payments because I am not . I'm not a HOA.The only subdivision close to me has 5 trailerhouses in it . Just somebody that knows my land is worth far more then these clowns are letting on.It doesn't take a degree in Rockology or any other kind of ology to tell someone...............No, My lands worth much more then that!
You may have to be the first on your street that says "I don't give a rip what they say". It's got to start somewhere.
$5500 on 1/4 acre will net you about $1375 before taxes.Just seems like to me its worth a shot.How many more chances do we get ?
P.S. HOA's in this area haven't pulled their weight. May be a blessing that you don't have one.
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I see your point but it is more difficult to sell a mansion vs a middle class house. The realitor should receive more money. From what i understand, it is more difficult to get a lease on 1/2 acres vs 80. Isn't that why we are all pooling? The larger the acreage the easier it is to negotiate a good deal. I think the % should max at a certain number of acreas. Say 3-4% of the first 20 acres.
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Permalink Reply by sissy on
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Update as of 7/16/08 - Yesterday, I spoke with a Greenwood resident who said they got $19,000/acre through Denny Reedy (Fortress Management, LLC). I was also told that XTO has recently obtained about $80 million to use for leasing. That is probably why I heard that XTO will top whatever offer you currently have. I received a flyer on my door yesterday from a Landman with Fleet Oil and Gas Ltd. Anyone know anything about that company? I am in Section 25 (Steeplechase)
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Permalink Reply by Shaq on
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Why should they get paid on the full amount? If you are deaf, dumb and blind you can still get $10,000 in this market. A better way to do it, IMO, is to figure out what the current going rate is and then pay him only on amounts that are exceeding that target.
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Permalink Reply by Rocker on
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I've seen the Fortress lease and I've been to the same meeting in Grawood. The 4% is not bad but the royalty deal says if I get 25% then Fortress doesn't get anything but if I get more than 25%, Fortress gets that amount. I think Fortress makes a deal for higher royalties and the landowner still only gets 25%. I think they have revised their lease since then, but I would read over that section in the lease about royalties carefully, after all you are entitled 100% of your unleased land.
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