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Colorado ranch developed by Michaels co-founder sold at auction

The sprawling Pitkin County, Colorado, ranch owned in part by one-time billionaire Sam Wyly has recently been sold for $12.75 million -- a figure far below the initial asking price back in 2014 of $59.5 million. That price continued to drop after that because, as one real estate professional noted, "The market for large acreage and high-end luxury property is a very small market."

The 244-acre Woody Creek property, called Circle R Ranch, was finally auctioned off last month in what was the latest financial hit for the Texas entrepreneur who co-founded Michaels Stores Inc. -- the chain of arts and crafts stores.

Wyly, along with his brother Charles' estate, was hit with a $300 million judgment from the Securities and Exchange Commission (SEC) for alleged fraud. His brother was killed in 2011 in a car crash near Aspen when he was 77.

The brothers had reportedly developed the property together back in the early 2000s. However, Sam Wyly claimed to own just 1 percent of it. The rest was reportedly owned by an offshore trust located on the Isle of Man.

The winning bidder in the auction, which lasted for just a half an hour, was a Texas developer who already owns a home in Aspen. The developer, who described the new purchase as an investment, has a history of buying luxury properties at bargain prices.

The ranch includes six homes as well as cabins and horse facilities. The new owner says that the deed prohibits further subdivision. However, he says that he can still build a minimum of four more large homes on it.

Colorado properties of all sizes are auctioned off for a variety of reasons. There are some good deals to be found. However, there may be some complex legal issues associated with these properties. If you're considering bidding on a property at auction, it's wise to seek the guidance of an experienced Colorado real estate attorney.

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