Coeur Terre is an Illegal Monopoly
By North Idaho Slow Growth Research
There are many serious problems with the Coeur Terre Development.
In previous articles NISGR has pointed out the entirely dysfunctional traffic grid surrounding Coeur Terre, caused by shortsighted Central Planners. We have also investigated suspicious changes to Idaho’s Tax Code that appear to benefit Coeur Terre property owners. And finally, we are critics of the entire planning process, which almost certainly violated Open Meeting Laws.
But the worst problem with Coeur Terre is that the corporation that owns it is in flagrant violation of Idaho’s Monopolies and Trade Practices Laws. And local governments who have had extensive dealings with Lakeside’s planning agencies over the last decade see no problems and are fully cooperating with the scheme.
According to Title 48, Chapter 1 Idaho Competition Act, there are laws against persons who conspire to monopolize any area of Idaho Commerce . So unless real estate development is exempted, these laws should apply to the owner of the Coeur Terre Properties. (See text at the bottom of this article.)
Lakeside Companies is a private equity firm whose business plan appears to be to control all real estate development along the Huetter Corridor. According to its timeline the company did not begin investing in land until 2012 and did not sell its first home until 2015, yet in less than a decade it has grown to control an enormous portion of the CDA/Post Falls new home market.
Lakeside appears to be extremely well-connected with both local and national money-interests. It is tied into corporate investment networks and appears to have access to unlimited capital, with which it is buying up both land and companies. And the amount of sway it has over regional governments is enormous.
So why has Lakeside been allowed to flout the laws? How can a corporation that is so flagrantly monopolistic be permitted to expand?
“Acquisitions that Substantially Lessen Competition”
It is important to understand that a firm does not have to control every property in an area in order to have an effective monopoly. A company that controls a large percentage of a housing market can manipulate the supply in such a way that the “free market” cannot regulate prices, and “outsiders” cannot compete effectively.
That is why Idaho statutes prohibit “Acquisitions that Substantially Lessen Competition” [48-106], and “Unreasonable Restraint of Trade or Commerce” [48-104], as well as “attempting” or “Conspiring to Monopolize any line of Idaho Commerce” [48-105].
To complicate things further, there are two ways a firm can monopolize an industry. A horizontal monopoly is one where a single firm dominates the market for a particular product. In the case of Lakeside, this “product” is land. Through its subsidiaries Lakeside now owns tens of thousands acres in both Kootenai and Spokane counties, and wields enormous influence over area land use policies. And with the purchase of over 1400 highly coveted acres along the Huetter corridor, Lakeside partners now have complete control over virtually all undeveloped land between CDA and Post Falls.
Yet at the same time, Lakeside is working to “vertically integrate” its holdings. Its subsidiaries cover all aspects of real estate development and include:
- Kootenai Land Company (Site development, Platting, Master Planning, Utilities)
- Architerra and Markam Builders (Home Building and Sales)
- Echelon Village (Real Estate Management, Rentals)
- HOAM (Home Owners Association Management Company)
- Century Farms (Land Holding, Land must be farmed to qualify for low taxes)
So it appears that Lakeside is well on its way to dominate the regional real estate market in West Coeur d’Alene by buying up all available land and controlling every aspect of its development. The following chart shows the growth of Lakeside over time. The firm is spending tens of millions to buy up companies and property without any concern for cash flow because they have unlimited funds to invest.
A Real Estate Monopoly was Always the Plan
We don’t know how much Lakeside paid for the Coeur Terre properties, or what the terms of the sale were. But it seems clear that Lakeside had an inside track and that all other less influential parties who may have been interested in developing portions of the property were shut out entirely. If the sale of the property had been more transparent or open to other purchasers, the property may have been developed gradually with more concern for market forces, instead of being partitioned by monopolistic central planners.
But there was never any intention of allowing ANY outside involvement in the planning, development, or ownership of Coeur Terre. The property was always intended to be a “Master-planned” community; developed and controlled by wealthy investors with a particular Agenda. Every park, home, business, roadway, tree, and bike lane in Coeur Terre will be designed by Lakeside planners, and built by Lakeside’s developers.
And even after the properties developed by Lakeside associates are sold, a Lakeside directed “Home Owners Association” will continue to control the properties, tax the residents, and “enforce” HOA Policy Violations. Forever.
In short, Lakeside is backed by unlimited “Global Capital”. It is buying up all the property in the region, controlling every aspect of its development, and has no intention of ever giving up corporate control of any of the property.
How could a cartel of powerful investors plotting to control all residential and commercial land use in an area possibly make their designs more obvious?
So the question is, if the Lakeside Company is not illegally monopolizing all real estate planning and development along the Huetter Corridor, what exactly would monopolistic activities look like?
If Lakeside is not a monopoly, then all Idaho’s statutes governing Monopolies and Trading Practices are a dead letter.
What is really disturbing about all this, however, is that our Government Officials do not seem to bet the least bit concerned about any of this. No one seems to think that monopoly capitalism or this type of central planning is a problem. Does anyone study history?
Most government leaders seem to be entirely on board with a private syndicate of wealthy investors controlling virtually all developable land in the area. It’s business as usual. Why is that?
Is There a Remedy?
Is the Lakeside Company untouchable? Or are government leaders more aligned with the interests of wealthy monopolistic planners than with the desires of the citizens they supposedly represent. Perhaps three decades of tolerating centrally planned “redevelopment” of the area under the fraudulent banner of “Urban Renewal” has something to do with this.
How can the government protect us from monopolistic cartels when government agencies are part of the problem.
Is there a remedy? We’re not sure, but maybe. According to Idaho Statutes: 48-108, the Idaho Attorney general may bring action against corporate monopolies. The previous Attorney General served appeared to be uninterested in enforcing anti-monopoly laws, but as of January, we have a new A.G. in Boise.
Will the New Attorney General be another “insider” who tolerates corrupt and monopolistic business practices? Or will he follow Idaho law and put an end to Monopolistic Conspiracies such as Coeur Terre? Time will tell.