LAND OWNED BY WINDING RIVER ASSOCIATES
IN WASHINGTON COUNTY, UTAH

Winding River Associates (“WRA”) owns over 4,500 acres of land in Southwest Utah, located in Washington County.  The property consists of four parcels, all northeast of the county seat of St. George City, with acreage as follows:

• Winding River South (Hurricane City)            2,212 acres (under contract to sell)

• Ash Hills (Toquerville/LaVerkin)                    1,758 acres

• Winding River North (Hurricane City)               307 acres

• Gateway Industrial Park (Hurricane City)         233 acres

          Total Approximate Land Area                      4,510 acres

GENERAL

Washington County is known as “Utah’s Dixie,” and St. George City styles itself as “The Other Palm Springs.”  The climate is warm year-round, air quality is excellent and the scenic views are magnificent.  St. George is the last major municipality en route from Los Angeles, Las Vegas and other points south of Zion and Bryce Canyon National Parks.

Substantial development has occurred within St. George, but developable land in the city has become less available.  It is believed that a substantial portion of the future land development in Washington County will occur along the St. George/Hurricane City corridor where the subject parcels are located.

LOCATION

The properties are located in picturesque southwestern Utah in Washington County, about 135 miles east of Las Vegas and ten to fifteen miles north of the Utah/Arizona border.  The county seat of Washington County is St. George, served by Interstate Highway I-15.  WRA’s holdings lie approximately nine to fifteen miles northeast of St. George.

Quail Creek Reservoir

WRA’s properties are located near the forty-thousand-acre-foot Quail Creek Reservoir, formerly partially owned by WRA.  Quail Creek Reservoir serves as a recreational facility for fishing, boating, camping and other activities for the area.  The reservoir is also a potential source of water for the future development of WRA’s properties. 

Zoning

Winding River South, Winding River North and Gateway Industrial Park are located within Hurricane City.  In December 1997 Hurricane City approved a City land use map included herein in Section 3, Exhibit 1; which shows the zoning for the parcels located in Hurricane.

PARCEL DESCRIPTIONS

Winding River South (under contract to sell)

The Winding River South parcel consists of approximately 2,212 acres and is considered by many to be the most valuable, privately-owned property of its size available in southern Utah.  A master plan has been prepared by the nationally recognized land planning firm of EDAW, Inc., and a consistent land use map has been approved by Hurricane City.  Winding River South is located approximately three miles east of the Interstate I-15 and State Route 9 (“SR-9“) interchange, with about 2.2 miles of highway frontage creating the parcel’s northern boundary. 

Five entrances from SR-9 to the Winding River South parcel are approved and paved to the property boundary.  The portion of SR-9 located nearest to Winding River South and Winding River North has been recently widened to four lanes with a continuous left turn lane and serves as the main route to the west entrance of Zion National Park, which is visited by more than two million people per year.  The route is also used to reach the north rim of the Grand Canyon and Bryce Canyon.

Utilities run to and partially through this property, including an eight-inch, high-pressure natural gas pipeline trunk operated by Questar located within the SR-9 right-of-way in front of the Winding River South parcel.  Significant water rights are owned by WRA which are associated with Winding River South, and municipal water is presently available. 

The water rights associated with the Winding River South land are summarized below:

Additionally, WRA has the right to obtain up to an additional 1,060 acre feet of culinary water from the City of Hurricane.

Ash Creek Special Service District (“ACSSD”) provides solid wastewater collection and treatment utility services for Hurricane City and the municipalities east of Hurricane, including Toquerville and LaVerkin.  ACSSD recently purchased from WRA the property (170+ acres) where the sewer lagoons are located.  ACSSD presently uses a sanitary sewer lagoon system but it is anticipated that the present system will be replaced by a mechanical system to be located southwest of the current site.  When the sewer lagoon system is replaced with a mechanical plant, WRA or its successors in interest have the right to purchase any of this property that ACSSD intends to sell.   

Winding River North

Winding River North consists of approximately 307 acres and provides a spectacular view of the Virgin River.  A Special Improvement District is already in place providing all the utilities and major roads necessary for the property’s development.  Since the land map presently designates industrial zoning for the area, an office/industrial development is envisioned at this time.

Ash Hills

Approximately 1,500 acres of the 1,758 acre Ash Hills parcel lies within the town of Toquerville, a small “bedroom community.”  Rising westerly from Ash Creek, the contour of the land slopes gently from an elevation of about one hundred feet above the creek to an undulating plateau.  The topography is variable, with ridges, basins and rolling hills.  The Ash Hills parcel is considered by many to be an extraordinary property; however, to date, little in the way of infrastructure installation or land planning has taken place.  Recently, WRA acquired the rights to 1,500 water hookups from the Washington County Water Conservancy District enabling the property to now be planned and developed.   

Gateway Industrial Park

Gateway Industrial Park is the best industrial park in southern Utah.  WRA owns approximately 233 acres with frontage on both sides of the road known as “Old Highway 91,” with excellent visibility from both I-15 and SR-9.  Topography is mostly level and provides a picturesque view of the nearby mountains.  A Special Improvement District has established all utilities and the main roads allowing the property’s development.  To date, a 1,200,000-square-foot Wal-Mart distribution facility has been constructed and is operating, along with facilities for PacifiCorp, Pace American, Gale Industries, Winkel Distribution, Inc., Mikohn Gaming Corporation and DATS Trucking.  Pepsi and a spec building (Crocker Building) have now been built.  Neither of these were WRA transactions.  In June 1999, an affiliate of Winding River Realty and WRA completed construction on the 87,000 square foot Mikohn manufacturing facility.   

CURRENT AND POTENTIAL DEVELOPMENTS

Potential significant events which may materially improve and/or expedite the development of WRA’s acreage include the following:

1.         SunCor Development is currently developing a 2,200 acre mixed use community at the intersection of I-15 and SR-9.

2.         A new reservoir (presently referred to as the “Sand Hollow Reservoir”) has recently been completed and water is now flowing into it.  This is a 1,300 acre surface area, fifty-thousand-acre-foot reservoir located approximately one mile south of Winding River South.

3.         A 15,000 acre State Park around the reservoir and the sand dunes to the south is approved.  Construction of some of the facilities are expected in the near future.  The use plan includes activities such as boating, fishing, horseback riding, four-wheeling, hiking, etc.

4.         The principal north/south artery of the proposed Southern Utah Corridor, which is to link vehicular traffic from Utah and other states in the northern United States with Mexico, could potentially be located on or near the Winding River South acreage.

5.         The approval process for a new, larger regional airport for the St. George/Washington County area is well underway and is planned several miles to the south, connected by the Southern Corridor described in Paragraph 4 above.

6.         A proposed Lake Powell pipeline could provide St. George with sufficient water capacity to sustain the area’s growth well into the twenty-first century.  The feasibility study has been completed and some design efforts are underway.  The terminus of this pipeline is the recently completed Sand Hollow Reservoir.