David Baker joins us to talk why investing in undeveloped land may be the secret strategy you've been waiting for. We also discuss why water rights may become one of the most valuable assets in the coming decades and how growing water scarcity is driving demand for land with access to water. Drawing on his background as a hedge fund manager, real estate investor, and founder of the Land Value Alpha Fund, David explained how water rights work, particularly in Montana, where groundwater and surface water rights can significantly increase property values. He highlighted research suggesting that investments in water infrastructure such as wells, pumps, storage systems, and distribution networks can generate substantial returns, while increasing demand for water, energy, and developable land is creating a powerful convergence that could push land prices much higher over time. Today we discuss...
- Why water scarcity is becoming a growing global issue and increasing the value of water-rich land.
- How groundwater and surface water rights work, particularly in Montana.
- The unique advantages of Montana as a headwater state that supplies water to much of the western United States.
- How property owners can develop wells and water infrastructure to increase the value of their land.
- Research suggesting that investments in water infrastructure can generate significant returns relative to their cost.
- Why water rights are becoming increasingly important for homeowners, farmers, developers, and businesses.
- How increasing demand for water and developable land could drive land prices substantially higher in the future.
- The relationship between land ownership and water access, and why water often determines a property's long-term value.
- Examples of investors and institutions acquiring land specifically for its water resources.
- How water banks allow water rights to be leased, traded, and allocated among different users.
- The challenges surrounding water allocation and legal rights in regions facing water shortages.
- Why desalination has not been adopted more broadly despite its potential to address water shortages.
- Real-world examples of water rights mistakes that can create major problems for landowners and developers.
- Why understanding local regulations is critical when investing in land and water resources.
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Today's Guest: David Baker
David N. Baker ("DNB") is the Managing Principal of Land Value Alpha Fund and Land Value Alpha Capital. The fund is dedicated to investing in what DNB considers the world's most inefficient asset class: Land. The Fund's investment strategy focuses on acquiring undervalued land in tertiary markets, conducting infrastructure development (building roads, pulling power, drilling water wells, installing remote power generation), acquiring and monetizing water rights) capitalizing on existing natural resources and gaining entitlements, for the highest and best use of the land, to generate superior (alpha) returns. With over 25 years of experience, DNB has successfully developed and invested in rural, commercial and residential land, while developing, redeveloping and operating self-storage facilities. He has led as owner and project manager, multi-million-dollar infrastructure projects in Montana and Oregon, including: remote road construction, power installation, water well drilling, septic systems, pump stations, underground irrigation and home site preparation.
Prior to Land Value Alpha, he was the majority owner and Managing Member of Mercadyne Automated Properties (MAP), a portfolio of self-storage properties that he purchased from 2014-2016 and brought from distressed, to cash flow positive and then sold the portfolio in 2023-2025. Prior to MAP he was an advisor to microcap public companies, taking several companies public, Galaxy Gaming, ZAGG, Akeena Solar and many others. Principal of three previous small cap/micro-cap, non-correlated, hedge funds and two advisory firms. David has directly invested in more than 200 small cap/micro-cap structured financings. He co-founded (Revere Data LLC fka Sectorbase), eventually acquired by Factset Data Systems, Inc. in 2013.
DNB's career has also included other investment management capacities, proprietary trading, investment banking and securities brokerage. Operational roles in database software, renewable energy (wind turbines), self-storage and fintech. He has authored or co-authored 7 financial analytics and database patents. David earned a B.A. in 1989 from the University of Colorado and received a J.D. in 1992 from Golden Gate University (interned with the SEC, division of enforcement and division of corporation finance). He has previously held Series 7, 63, 65 and 55 securities licenses.
David's Online Presence: