West Ada

10 years, $1 million spent, still no deal: This man plans to remake downtown Meridian

Other developers want to build apartments on the land. But the developer’s price is high, and he’s not budging.

In 1884, the railroad came to Meridian, creating a hub where there had been only a loose patchwork of homesteaders before. At the station built there, farmers would ship crops further west. Families would send packages back east.

Around the station grew other businesses to serve the community. Meridian’s downtown was born.

Today, as the city pushes to redevelop its downtown, the old Union Pacific Railroad station property is holding Meridian in the past.

That property — 20 acres, two blocks long and half a mile wide — is an industrial dead zone. A few businesses that leased property from Union Pacific have since boarded up. These days, the area doesn’t get much traffic, save for the trucks rumbling along the dirt between two construction companies that remain.

“This blighted Union Pacific property is in the heart of our downtown and has been an obstacle to redevelopment as long as I have been involved with the city,” wrote Meridian Tammy de Weerd in a statement to the Idaho Statesman. “We have worked for years with Union Pacific hoping to see potential improvements.”

The property is prime for redevelopment. City leaders say that building anew on the blighted railroad land could catalyze growth downtown that they have longed for.

In the last few years, developers have inquired about the land. But upon further inspection, they discover that there’s someone who already has it tied up: Bill Ditz. And he has his own agenda.

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Bill Ditz, with Mountain West Group, hopes to transform the business district in Downtown Meridian adjacent to the railroad corridor. Darin Oswald doswald@idahostatesman.com

Few have heard of Ditz. On his website, he describes himself as a “visionary executive.”

That might be a fair description, given how few of his projects get past a vision. In the nearly 25 years he’s worked in the Treasure Valley, the 68-year-old self-described developer from Eagle has yet to build anything.

For the last decade, Ditz (pronounced deets) has concentrated all his efforts toward developing the 20-acre station property. There’s just one problem: He doesn’t actually own the land.

Neither does Union Pacific Railroad, Ditz contends. The government granted the railroad an easement years ago, giving it the right to use the land indefinitely, but no actual ownership.

Ditz hopes to transform the Union Pacific property into a multiblock urban neighborhood with numerous buildings, below-ground parking and hundreds of thousands of square feet of apartments, offices, restaurants, and a children’s theater.

But Union Pacific has not readily agreed to its own redevelopment — especially not when redevelopment entails relinquishing land it had controlled for over a century.

Ditz says he has found the underlying land owners and has a contract to buy the land from them once Union Pacific gives up its rights. That means anyone who wants to build on those 20 acres must go through Ditz.

Some developers say he has sat on the land too long. Josh Evarts, a Meridian businessman who’s worked on three projects downtown, said it’s time to get a deal done.

“If someone has been working on a project for 10 years and doesn’t have anything to show for it, to hold onto it is just hurting our downtown renewal efforts,” Evarts said in a phone interview.

Ditz said he has sunk more than a million dollars into untangling a complicated web of land records and contracts that date back to the city’s original platting in the 1800s and the founding of the railroad.

It’s an essential project for him — one that could turn around his career and cement his legacy as a developer.

“I’ve put everything I have into it,” he said.

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“This station property-this blighted little industrial district-has tended to put a damper on entrepreneurial investment,” Bill Ditz said. The manager of Boise-based Mountain West Group has worked to sort out the easements and ownership of the involved properties in hopes of improving the area. Darin Oswald doswald@idahostatesman.com

A developer on the fringe

Ditz was born into a family of California developers. His father, a lawyer-turned-homebuilder, ran a company that cranked out 30,000 houses across California and Arizona.

Ditz followed his father into the real estate world, working in the 1980s as a project manager in Northern California, where, he said, he helped develop over 2.9 million square feet of real estate.

In 1991 he moved to Eagle to work for the Sundance Co., a Meridian development firm. After a year, he tried to make it alone, pursuing a few deals in Boise, like one to buy the Hillcrest Shopping Center on Overland Road and another to complete a high-tech office remodel on Fairview Avenue. Both fell through.

In the early 2000s, Ditz decided to try his luck in Colorado Springs, Colorado. The real estate bubble fueled a string of residential and industrial projects there. But when that bubble burst, Ditz packed up and returned to Idaho.

“It’s a cyclical business,” Ditz said. “You don’t want to be holding the bag when the music stops and there aren’t any chairs.”

As the economy crawled back to life, Ditz re-entered the real estate game, starting a firm he named the Mountain West Group. He says he nearly bought the Owyhee Hotel downtown — until Clay Carley got ahold of the property.

Ditz never had the financing to execute his plans. He existed on the fringes of the Boise real estate world, watching as established players like Corey Barton and David Turnbull of Brighton Corp. profited off the region’s immense growth.

He was always hunting for investors who never seemed to commit, or the timing was off, or maybe he hadn’t built up sufficient real estate karma — but really, he just didn’t have any cash, and in real estate, you need money to make money.

“It’s been a real struggle to do these projects when you don’t have a lot of money — that all-important money,” he said.

Finding the heirs

To understand why no one has developed this prime piece of real estate, Ditz says you have to go back in Meridian’s past, before Meridian existed and there was just the railroad.

Here’s what Ditz says happened:

In the 1800s, the government helped railroads expand by allowing them to claim 20 acres of public land every few miles for stations. When a railroad decided it didn’t need the land anymore, it would return the land to the government.

About 1890, the railroad claimed these 20 acres and sent the paperwork to Washington to secure it.

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Meridian students dress in their Sunday best to board the Union Pacific train to Moscow during the 1930s. City of Meridian

But two people were in the midst of buying that land, too: a homesteader named Eliza Zenger, who had just moved from Utah with her husband, Christian, who filed the original plats for Meridian; and a man named Joseph Reed. While the paperwork that would make those 20 acres a railroad station was still in transit, the county office sold the property to Zenger and Reed.

“The government sold the property twice,” Ditz said.

Legally, the railroad easement trumped Zenger and Reed’s ownership. With the railroad occupying their land, the two owners stopped paying taxes on it. If you don’t pay taxes long enough, the government can seize the land — which is what happened to Zenger and Reed. In 1907, the county sold it at a low price at auction to four new owners.

Over the years, their families lost track of the fact they owned any land in Meridian at all. On the surface, the railroad was still in charge of the land. Everyone just figured Union Pacific owned it. Including Union Pacific.

Ditz convinced Union Pacific otherwise.

In 2009, he and a business partner, John McCarthy, heard that Meridian wanted to redevelop that downtown property. The City Council had considered the site for a new city hall a few years earlier but gave up when officials realized that the greater task would be finding the heirs to the underlying landowners.

Ditz raised his hand. He spent months working with a genealogical researcher to track down the heirs.

When he found them — all 53 heirs to the property — many of them were convinced Ditz was roping them into an elaborate scam. After all, how do you react to a phone call from a stranger who tells you that your great-great-great-grandmother once bought one of the original platted parcels in Meridian, but that for the last century the railroad had used that land via an easement, and that you might be able to earn a small fortune by signing a contract to sell this land you didn’t know you owned to a man you don’t know?

After months of phone calls and meetings, Ditz persuaded the heirs to sign his contract: if they were to sell the property, it would be to Ditz, and Ditz alone.

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Joseph Reed and Eliza Zenger, two of Meridian’s earliest settlers, bought the Union Pacific land from the United States government in the 1890s. Their patents were signed by President Benjamin Harrison. Provided by Bill Ditz

Getting it perfect

Real estate development is a game. More precisely, it’s like that Milton Bradley game Perfection, where a player must fit a dozen plastic pieces into matching slots in a tray before time runs out. If you don’t, the tray springs up and “pop!” goes Perfection — scattering the pieces in all directions.

The next piece for Ditz to fit was Union Pacific, which still maintained its old rights to the 20 acres.

Union Pacific said it wouldn’t give up its rights to the property unless the two construction companies it subleased to — Builders FirstSource, a building materials supplier, and PrecisionCraft, a log home builder — also agreed to move. But the two companies had little incentive to find a new location. Though they were subleasing the dirt, they had built their own offices and warehouses on it.

Ditz offered to buy them other land in exchange. Without any money himself, Ditz found an investor who could buy a parcel to complete the swap.

It took years to find land Builders FirstSource and PrecisionCraft could agree on. He made offers on a few properties, even putting down deposits on some, but just when Ditz thought he had a deal, ProBuild said it couldn’t wait any longer and would stay downtown.

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Kate Talerico ktalerico@idahostatesman.com

“Timing is really critical on these things so often,” he said. “And each time you have to spend money: on engineers, on deposits, and some of them are nonrefundable. You negotiate like crazy for all of them to be refundable, but I still lost $100,000 on nonrefundable deposits.”

“Pop” went Perfection.

Ditz had to begin anew. $80 million — that’s how much he wanted to finance the 5-block project.

Four years after his original deal fell through, Ditz found a new potential investor: Bill Truax, president of the Galena Opportunity Fund in Boise, which invests in residential projects throughout the Northwest.

Ditz went back to Union Pacific’s tenants to ask: Would they still be willing to move if Ditz bought them a new property? Sure, they said.

But Truax had no interest in a messy land swap. He pulled out.

After another investor deal fell through around the end of 2018, Ditz was defeated. “We shut down the whole effort,” he said. “It was a catastrophic loss, financially.”

“Pop” went Perfection, again.

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Many businesses near the railroad in Meridian have been vacated, leaving unmaintained property. Darin Oswald doswald@idahostatesman.com

Scaling down the scope

Last December, just when Ditz had decided to move on, something happened to restart the project. After years of pressure from Ditz, the city, and its urban renewal district, Union Pacific said it would sell six of its 20 acres on the corner of Main and Broadway. No land swap necessary.

Ditz was halfway through a training program to become a health insurance salesman. He quit to return to the land he could never rid himself of.

He hired architects to scale down his dreams onto a smaller canvas. He came up with a plan for 160 apartments and condos, with 112,000 square feet for offices and 36,000 square feet for restaurants, plus 500 underground parking spots.

Truax came back to the table. But he wanted to buy out Ditz, to control the project fully.

“It’s about how much skin you have in the game,” Truax said.

Truax wanted to build more apartments, including workforce housing, and toss out Ditz’s below-ground parking lots and office space. He predicted he’d need close to $150 to $200 million to build the project —much more than Ditz had estimated.

Truax agreed to a price with Ditz for the railroad land. He wouldn’t tell the Statesman what it was. But when he went to sign the papers, he said, Ditz asked for 30% more than they’d previously talked about.

“There’s a price for someone like Truax if he doesn’t want me involved,” Ditz said.

Truax walked.

Overpriced properties have become common in downtown Meridian, say developers like Josh Evarts.

“It disincentivizes people like myself from investing in downtown Meridian,” Evarts said. “We’re working really hard just to get things to pencil.”

Ditz said the price he wanted was justified: He would be “liberating the most important piece of property in downtown.”

“I’m the one who’s paid all the bills, the one who’s fought to get this project developed,” he said.

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When Bill Ditz started working on plans to redevelop the 20-acre Union Pacific property north of the railroad, he envisioned a five-block development plus a new stadium for the Boise Hawks. After he could not persuade the two builder companies subleasing the land on the east part of the parcel, Union Pacific said they would be willing to sell their rights to a 6-acre block between Main and Third streets. His new plans include six buildings, including space for a children’s theater. Provided by Bill Ditz

Will it ever be built?

On a sweltering morning in July, Ditz stood in the middle of the 6-acre property he doesn’t own and envisioned all that he wanted to build there.

He pointed to a vacant tire shop: “That’s where we’ll have our office — a temporary one.” Over near the sidewalk, that’s where the restaurants will go, with big outdoor patios. If politicians ever find the funding — or the time to negotiate with Union Pacific over the rights to the tracks — this is where a light-rail station will go, too.

Even after 10 years, Ditz talks with fresh energy about the project. He remains optimistic that he can pull it off.

“My enemies and naysayers are saying it’s not going to happen,” he said. But he’s tuning them out. “This project’s going to change the course of history in downtown Meridian.”

But Truax worries that development could stall without an experienced developer at the helm. Truax wagers that if he got control of the land, he could get most of the work done on a residential and retail development in three years.

“There has to be a point where Bill decides if he wants us as an equity partner or not,” he said.

For now, the project remains in limbo. Ditz says he’s close to finding another investor.

“It took a very unique individual and a unique approach to get this deal put together,” he said. “And that was me.”

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Kate reports on West Ada and Canyon County for the Idaho Statesman. She previously wrote for the Louisville Courier-Journal, the Center for Investigative Reporting and the Providence Business News. She has been published in The Atlantic and BuzzFeed News. Kate graduated from Brown University with a degree in urban studies.
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