History Lesson 
Should You Buy This Land?
Our writer becomes a salesperson, then a buyer, as she tries to unearth the answer. Hint: The Brooklyn Bridge isn't such a bad buy.
(Page 2 of 3)
There were only two other students in that week's training class. Both were management trainees. We ended up having two trainers for our session. The first, a guy named Bill Williams, was being transferred to a Horizon office in West Texas. His replacement, just up from Austin, was Bob Towerie, a former Highway Department attorney who said he had seen how much money could be made in land while working for the state. He had been with Horizon since May.
The three days were spent helping us memorize the Horizon pitch and perfecting our presentations. We also learned a few little maneuvers for taking control of situations. For example: Suppose we walk into a house and see a big, comfortable chair sitting in the living room with a pipe on the table beside it. We know that's where the man of the house sits. Sit in his chair, we're told. That way we'll dethrone the king. Then we'll be in charge.
The central element of Horizon's sales pitch is a large, loose-leaf notebook called the presentation manual. The book, which I was told cost $300,000 to produce, is ingeniously designed so that the cover makes a flip stand. It is full of beguiling color photographs. Horizon believes the notebook is the best tool for overcoming a common sales problem: people don't want to buy sight unseen.
We were told the manual was psychologically designed to lead the prospect through the presentation at the pace the company wants him to go, giving him just enough information at the right time. Or, put in the company's words: "The presentation manual is your best tool for control. Most prospects will want to jump from fact to fact or push the presentation to a climax too early. The presentation manual will keep them on your track and allow you to bring out the features when you want to bring them out."
The salesman begins by trying to establish the credibility of the Horizon Corporation: its growth, its worth, its reputation. He talks of the beauty of the developments, emphasizing strongly Horizon's master planning, and he lists the wide range of available activities, from swimming pools to country clubs to riding facilities.
The salesman shows the customer the land "chosen" for him.
"Now, Mr. And Mrs. Jones, the property I have just shown you has been registered in Washington, D.C., with the Department of Housing and Urban Development, and this Federal property report is yours to keep for as long as you may own the property," the salesman says before surrendering the report. "Now, by law, I am required to get your signature that you have received this Federal property report. Would you please okay right here?"
But most people don't sign so readily. They have questions, and Horizon has provided the answers, or "closes," for their objections.
The customers want to think it over, so the salesman turns to a chart in his presentation manual that shows that 91 per cent of all people 65 and over are still working, living off relatives, receiving pensions, or on welfare. Only 9 per cent have investment income.
"Would we have to assume that these people who are still working at age 65 at least though about saving or investing? Wouldn't we also have to assume that the people depending on friends and relatives also thought about saving and investing? And how about those depending on anything from Social Security to welfare? Can't we assume that they thought about saving and investing all their lives? Now these 9 per cent (living off investment income), what did they do that the others did not do? They had to stop thinking about it and start doing something about it...Please don't make the mistake that so many others do when opportunity exists. Okay, this agreement and let's get you started in the direction of that 9 per cent who will one day live on income from investments."
Perhaps the excuse is: We can't afford to invest at this time.
"Mr. and Mrs. Jones, is it the monthly investment that would be a problem for you or is it the initial investment? [Usually, it is the down payment, the manual says.] In other words, owning this property would not really take food off your table or clothes off your children's backs, would it? [Smile, says the training manual. Normally, the reaction is "no".] Fine, then go ahead and okay in these two places."
One salesman's own technique was to ask the prospect what he would do if his father came to him that very day and said his mother needed an operation, but before she could have it, he needed to give the hospital $200. The father doesn't have the money. "Could you find $200 for your mother?" the salesman asks. When the prospect answers yes, the salesman says he is not trying to suggest the property and the mother are equally important, he just wants to show the customer that he can get a hold of the money if he really wants to.
All Horizon management kept stressing honesty. Don't tell the customer he'll make money in two or three years; it's more like 10 or 20, you don't really know, they say. Don't tell them we'll resell their property. Don't tell them they can sell their property at any time.
Horizon apparently decided I would do okay as a salesman—at least long enough to try to sell some land to my friends. Horizon—the Dallas office, anyway—does not use the steak dinner approach. Nor, to my knowledge, does it have free fly-ins. Nor, with a few exceptions, does it give away free gifts.
Instead, it relies heavily on its telephone room to find enough people to listen to the Horizon story in their homes. However, salesmen are expected to do most of their own prospecting for potential customers. That usually means a salesman's friends and relatives get called on first.
I, however, insisted on seeing a real live presentation before I went out on my own. I was assigned to accompany a fairly new salesman on his appointments.
His talk was rusty, and I counted four mistakes in it, several of them major.
He told the couple that the cities near which Horizon has developments—Tucson, Phoenix, Albuquerque, and El Paso—were the four fastest growing cities in the nation. Not true. They are growing four times faster than the national average.
He said Horizon was the largest land developer in the country. Not true. It is the largest in the Southwest.
When the man indicated he wasn't interested in Rio Communities because of the length of time till the investment matured, the salesman tried to switch him to El Paso. "In my opinion, this property will mature in five years," he said. Mistake. We don't know how long it will be.
And when the man said he still wasn't interested, the salesman tried to interest him in buying El Paso or Albuquerque property which he could exchange later for land at Lake Livingston, when Horizon opens that development sometime in the spring. The man still didn't buy.
Afterwards, I asked my companion if he knew that Bob Towerie, the Austin attorney, had said we weren't to sell land based on being able to trade it in later for Livingston. The national office had not yet approved that trade.
The salesman hadn't been told. "If they don't allow the trades," he said, "there are going to be a lot of unhappy people around Dallas. That's the main way we've been selling land for the past couple of months."
The next day, I had to make my first sales presentation alone. I couldn't do it. I told the office I just didn't have what it takes to be a saleswoman. It was true, I didn't.
Very shortly after resigning from Horizon, I headed for Albuquerque. I wanted to find the answer to what I felt was the critical question: If one purchased property in Horizon's Rio Communities, would that land be worth enough in 0 or 20 years to be a legitimate investment? Was, in fact, the population of Albuquerque exploding and would the spillover inevitably head for Rio Communities?
My first stop was Rio Communities. Rio Communities is actually five developments—Rio Del Oro, Rancho Rio Grande, Rancho Rio Grande East, Rio Grande Estates, and Canyon Del Rio—lumped under the one name.
Rio Communities is a massive acquisition of land 35 miles south of Albuquerque near the town of Belen. It consists of some 230,000 acres—a land area larger than Albuquerque. Rancho Rio Grande lies to the west of the Rio Grande; the other four developments stretch from the river east into the foothills of the Manzano Mountains up to the Cibola National Forest.
Most of those 230,000 acres are undeveloped desert land. The land has its own arid beauty, particularly on the bright, sunlit day I viewed it. No one else was around except a young Chicano on a Shetland pony and a station wagon-load of Horizon customers zooming north on the Manzano Expressway. The Manzano Expressway is a weird-looking phenomenon out in the middle of nowhere, an unpaved swath of freeway bulldozed across the landscape. Here and there a bullet-riddled street sign acknowledges some land-planners dream.
The wide-open spaces I had expected. But Enchanted Mesa, the developed area of Rancho Communities, was a surprise. Horizon had promoted its master planning so much and its color photographs had looked so good that I had expected to see the beginnings of a beautiful community.
But Enchanted Mesa is ugly. It doesn't look like master planning to me; it looks like a poorly done rural subdivision. Its stucco and frame houses are some of the least interesting architecture around. (The most unusual, though certainly not the best looking, is a French provincial stucco with the French provincial part rising above the house proper, like a false front second story.)
In the older part (though not the newer) the streets are not curbed; utility wires drape across the sky; and regulations for things like fences seem non-existent.
The country club has been built, and so has the soon-to-be occupied shopping center. But despite what I think about Enchanted Mesa, it is the place to live in the Belen area. Enchanted Mesa has housing restrictions; anyplace else in the area an expensive house could have shanties for neighbors.
The photographer and I stopped at a Belen cafe. We told a woman there we were considering buying property in Rio Communities, but we wondered whether or not it is a good investment. "Maybe for your grandchildren," she says.
We used the same story with a real estate agent in the area. The realtor pulled out files of letters. Three or four people each week write asking him to list their Rio Communities property. Another three or four walk into the office with the same request.
"I have to turn them down," he said. "There is no market now for that property. I can't sell their land."
Horizon almost admits as much. We were taught in training class that the land investments are not liquid assets; they can't be turned into ready money. But the Horizon ads, particularly the one from last spring, perhaps imply something else.
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