New York investors snapping up Colorado River water rights, betting big on an increasingly scarce resource

With the federal government poised to force Western states to change how they manage the alarming shortfall in Colorado River water, there is one constituency with a growing interest in the river’s fate that’s little known to some: Wall Street investors.

Private investment firms are showing a growing interest in an increasingly scarce natural resource in the American West: water in the Colorado River, a joint investigation by CBS News and The Weather Channel has found. For some of the farmers and cities that depend on the river as a lifeline, that interest is concerning. 

“Our only source of water is the Colorado,” says Joe Bernal, who raises cattle and grows crops on land across Colorado’s Grand Valley, relying on water from the drought-depleted Colorado River.

“That’s all we’ve got is that river,” he says.

Bernal’s family came to the Grand Valley nearly 100 years ago, and he has lived there his whole life. 

But now, he has a new neighbor: a New York-based investment firm called Water Asset Management, which he says bought a farm in the valley around 2017 that Bernal now rents and helps operate.

According to public records, the hedge fund — which is headquartered on Madison Avenue in Manhattan — has bought at least $20 million worth of land in Western Colorado in the last five years, making it one of the largest landowners in the Grand Valley.

The hedge fund, founded in 2005, says it invests exclusively in assets and companies that ensure water supply and quality. In 2021, its co-founder and president, Matthew Diserio, called water in the United States “a trillion-dollar market opportunity.”

Bernal says that when first heard of the firm, he was concerned.

“Would I have invited them here? No.” Bernal says. “Am I glad that there’s a big company here buying properties in our valley, under our system? Not really.”

Andy Mueller, general manager of the Colorado River Water Conservation District, says he doesn’t think the firm wants much with the land.

“It’s the water,” Mueller says. 

“These are folks that have identified the drought as an opportunity to make money,” he added.

Mueller’s job is to protect Colorado’s share of the river, which flows through seven states and is an important water source for cities including Denver, Salt Lake City, Albuquerque and Los Angeles. He said Water Asset Management has acquired more than 2,500 acres of farmland and is interested in the water rights that come…