The following story was reported by The Utah Investigative Journalism Project in partnership with KUER.
On June 30, 2023, a beaming Senate President Stuart Adams, R-Layton, joined a handful of local politicians to celebrate the completion of the U.S. 89 highway expansion. For years, Davis County commuters had negotiated orange traffic cones while the project was underway. Now, cyclists, walkers and runners cruised along brand new frontage roads and bridges from Antelope Drive to the Oak Hills Drive park-and-ride lot.
It was the Utah Department of Transportation’s largest construction project in a decade, pulling out stop lights, building bridges, on-ramps and a new lane of traffic to turn the state road into a full-fledged highway.
Adams told reporters his desire to improve 89 got him involved in politics back in the 1990s. It took him from pushing for safety by adding traffic lights to Highway 89 while on the Layton City Planning Commission to later becoming president of the Utah Senate, overseeing the funding of transportation projects across the state.
In all, the U.S. 89 expansion project cost $526 million, including $3.9 million to Adams’ own development company. UDOT purchased almost 7 acres of land from Terraventure Investments, the real estate development company run by Adams and his brother, even though only a small portion was needed for the project.
But records show the agency initially planned to purchase an easement and smaller portions of that 7-acre parcel.
What started as a $1.3 million offer was negotiated up to $3.9 million by the Senate president.
UDOT director Carlos Braceras said buying whole parcels lets the agency protect the property values of other nearby parcels that the agency had also bought.
“Our perspective is that we wanted to protect what development goes in there so that it didn’t negatively impact the new interchange we put in,” Braceras said.
While Adams would not comment for this story, his presence at the negotiating table is another example of the deep ties Utah lawmakers have with the state’s real estate and development.
Business as usual?
UDOT spokesman John Gleason said there was nothing unusual in the deal with Terraventure.
“On the U.S. 89 project, we worked closely with more than 230 different property owners and invested approximately $55 million in property acquisitions. Senate President Adams' property was acquired using the same fair and consistent process applied to all property owners on the project,” Gleason said in a statement.
The Utah Investigative Journalism Project, however, reviewed dozens of UDOT’s property acquisition contracts for the U.S. 89 project over three years in Davis County. Out of 35 transactions, the majority were payments for easements or purchases of small parcels of land. The average amount paid was just over $300,000.
Braceras said it is common for UDOT to buy whole parcels historically, and the agency bought many whole parcels over the life of the decade-long U.S. 89 project.
But Adams is no ordinary developer. As Senate president, he leads funding efforts for UDOT through his work on the Senate committee overseeing transportation and the powerful Executive Appropriations Committee. According to Braceras, the two have worked closely together for decades.
That close intersection of business and politics raises concerns for Sen. Nate Blouin, D-Millcreek. Blouin called for the resignation of Adams after The Salt Lake Tribune reported Adams initiated a change to Utah’s child rape law that benefited a relative.
Blouin said it's unfortunate that Adams appears to again be benefiting from his position as one of the most powerful politicians in the state.
“In an ideal world, these are things that should be clear cut to the public as the decision’s getting made, not once someone finds out that, ‘Oh maybe there was a problem, maybe there is a conflict here that one of our leaders is going to significantly benefit from,” Blouin said.
“I don't think you would see UDOT making these decisions to spend millions of dollars on these things if it was known widely to the public that the president was going to benefit from this like he seemingly has,” Blouin said.
UDOT’s Gleason said the agency began negotiating over the Adams property in 2019 “as a part of UDOT’s efforts to build a new frontage road directly through his property and minimize the need for additional easements along the new U.S. 89 corridor.”
Gleason also noted the deal meant Terraventure Investments had to demolish storage sheds on one of the properties sold to UDOT.
The Utah Investigative Journalism Project received a log showing negotiations between UDOT and Terraventure Investments. It shows a back-and-forth with UDOT and David Adams II in 2021 over fair expenses to cover the losses the business would face for vacating its storage units. The negotiations were at an impasse. Then, in 2022, UDOT also met with Stuart Adams.
The document is a brief description of the meeting, but mentions that Stuart Adams discussed trading his property for “adjoining property.” UDOT had also purchased parcels east and south of Adams’ properties. The parcels are part of Layton’s Town Center Master Plan, a proposed development that blends housing with retail and other businesses in a desirable walkable neighborhood. The UDOT staffer told Stuart Adams that he would have to discuss the trade with Braceras.
UDOT’s director, however, said he didn’t recall speaking with the Senate president about a land swap, and Gleason said there was no documentation of it.
“If it was mentioned, it appears to be something that was not pursued,” Gleason wrote.
According to the negotiation log, Stuart Adams insisted in 2022 that if a land trade didn’t happen, “he wanted the appraisal for his land updated.”
The original appraiser looked at two large parcels of land owned by Terraventure Investments, one 2.8-acre parcel west of U.S. 89 and just north of 1400 North in Layton, and a second parcel of nearly 5 acres south of 1400 North.
That 2020 appraisal focused on a “partial acquisition” and fair payment for a temporary easement on the portion of land UDOT needed for the project. It valued that easement for the south parcel at $792,000. The appraisal for the north parcel, including costs related to the storage sheds, was $523,900.
Those valuations add up to $1.3 million, a third of the $3.9 million UDOT ultimately paid for all the acreage in 2023.
Records show it was not typical for UDOT to buy whole swathes of land in Davis County at this time, rather than an easement. While UDOT was negotiating with the Adams brothers, it also cut a deal with a nearby homeowner’s association to pay $145,000 for an easement on the east side of U.S. 89, south of Adams’ property. In the case of the HOA land, UDOT had to build drainage facilities that affected a larger area than any changes to the Adams’ properties. UDOT also had to demolish an HOA-owned sports court.
Adams family legal drama
In July of this year, UDOT put the land bought from Adams up for auction along with surrounding parcels, including a larger 16-acre parcel south of Adams’ former properties. But after the auction started, the parcels were abruptly withdrawn by UDOT’s director, Carlos Braceras.
One developer, who declined to be interviewed, had already put in a bid of over $20 million when UDOT pulled the plug on the auction.
Braceras said the auction this summer was canceled because UDOT is working with Layton City on land use for the property, so it might be developed with a good stock of affordable housing.
“I’m not sure if that was a good bid,” he said of the $20 million offer, “because we didn’t get all the bids yet.”
UDOT’s auction info at the time, however, put the minimum bid for the properties at $16,750,000.
Braceras said Stuart Adams had no influence on the cancellation of the auction.
Scott Priest is a developer in Davis County who has competed with the Adams brothers for land on more than one occasion and even went against them in the fight to expand Highway 89. Priest said he’s got no beef with Stuart Adams and considers him a fair businessman.
Like Adams, Priest has also sold property to UDOT and said it’s not uncommon for the department to use only a portion of the land it buys.
“They always buy more land than they need,” Priest said. “They typically make money doing that.”
The real winner, Priest said, is UDOT — and, therefore, taxpayers — because it will make a tidy profit off selling the land.
“I’m sure they’ll make money off what they paid Stuart,” he said. “They bought the whole thing to go into some sort of shopping center.”
He believes Adams may have lost out on a more lucrative opportunity down the road.
“Is it a bad thing?” Priest asked. “It’s a bad thing if you’re the (former) property owner.”
That may be the case if everything was business as usual with the Adams’ company at the time of the sale. By the time UDOT bought the land, however, Stuart and David Adams were locked in a contentious legal battle to split the real estate development empire they inherited from their father.
In 2022, the brothers decided to divide the company and go their separate ways. Things have not gone smoothly since. In a lawsuit Stuart first filed against his brother on Jan. 30, 2023, he accused David of reneging on an agreed settlement on the allocation of the assets of their different companies.
For his part, David argued that negotiations were still ongoing and even cited communication from Stuart’s own attorney that they had yet to settle the handling of all the company assets.
David filed his response to the complaint on March 24, 2023, almost two weeks after the company sold its property adjacent to Highway 89 to UDOT for $3.9 million.
Lauren Cohen, a professor of finance at Harvard Business School who studies the dynamics of family businesses, said it’s common to see family businesses grapple with a change in corporate structure. Whether that’s a key leader in the business passing away, or a dispute between principals who also happen to be family, these shocks often force the business to sell off assets.
“If you can’t come to amicable terms, you are forced to sell,” Cohen said. “In finance, those are called fire sales. They are terrible for the seller but great for the buyer.”
According to Benjamin Means, professor of law at Joseph F. Rice School of Law at the University of South Carolina, family firms locked in ugly litigation sometimes have to make tough decisions.
Adams may have lost out on a long-term investment, but getting three times what UDOT originally offered might have been exactly the deal the company needed while the brothers duked it out in court.
“It is certainly hard to make effective medium-term or long-term plans when you are in the middle of a battle for control of the company,” Means said.
