Chips Act Path of progress investing is where the big dollars are made Oregon

[Jay Hinrichs]

For investors who may look to diversify their portfolio or who are not 100% in the camp of ( if it does not cash flow its not an investment)

or appreciation  is ( gambling) if you have been following the Chips Act news this is going to create a lot  of path of progress opportunities for investors.

Intel is one of the big winners.  With Oregon the #1 winner then Arizona then Columbus.  Oregon is getting 8.5 Bil from the feds and another 50 bil from other sources . Hillsboro Oregon is the number 1 Intel campus the most important campus in the company and the one that will never go anywhere. over the coming years there will be over 50 billion invested in the Hillsboro Ronler acres and surrounding area for up grades and new facilities and of course this will bring in support companies and expansion for Intel.

Once Oregon and AZ are up and running the next target will be Columbus while Columbus is moving along it will take longer there to get to full production and the focus will be Hillsboro Oregon first AZ second Columbus 3rd and there are reasons for this.  Work force that already exist in Oregon the concentration of Silicon Forest that already exists etc.

So what is the play.. Well right now there is a Huge issue with LAND to expand to and these issues are being worked on at the state level. Oregon has the housing and has the draw for quality of life to bring in top talent that's a given.. But you need the land to build the new facilities.

So how does that impact the longer term investor that may want to partake in Path of progress?  Identifying the areas were growth will happen through simple logic  studying infrastructure studying the city county long range planning documents that are usually only looked at by the Trammel Crow's of the world.. and get in front of this.  Not to mention for the cash flow investor housing will be key of course.. So either in long term buy hold or renovating older to new or building new. 

When an area the size of Hillsboro Oregon gets a 50 BILLION dollar influx that money is going to be  spread wide and deep.

@Nathan Gesner  Some of you may already be aware of whats happened with land values for properly zoned property. And the windfalls to the owners are life changing .  Hillsboro needs an additional 2k plus acres to go from current use to supporting new Chips related activities and business's..

Bottom line for some investors there is going to be some incredible path of progress windfalls.

[Nathan Gesner]

As you already know, my friend is under contract to sell some acreage for $23 million. I think he should have held onto it longer (he doesn't need the money), but he's in his 70's and wants to play while he still can!

Wyoming is building a nuclear power plant in a town of 2,400. https://energycommunities.gov/terrapower-nuclear-plant-wyomi...

Cheyenne is under consideration for a company that will produce portable nuclear power plants the size of a semi that can power 750 homes for five years. https://cowboystatedaily.com/2024/03/15/wyoming-a-finalist-f...

Wheatland, Wyoming (population 2,500) recently announced a rare earth mine that could possibly turn Wyoming into the largest producer of rare minerals in the world, knocking China out of the running. https://americanrareearths.com.au/cowboy-state-daily-rare-ea...

There are opportunities around the country to get ahead of growth.

[Jay Hinrichs]

Quote from @Nathan Gesner:

As you already know, my friend is under contract to sell some acreage for $23 million. I think he should have held onto it longer (he doesn't need the money), but he's in his 70's and wants to play while he still can!

Wyoming is building a nuclear power plant in a town of 2,400. https://energycommunities.gov/terrapower-nuclear-plant-wyomi...

Cheyenne is under consideration for a company that will produce portable nuclear power plants the size of a semi that can power 750 homes for five years. https://cowboystatedaily.com/2024/03/15/wyoming-a-finalist-f...

Wheatland, Wyoming (population 2,500) recently announced a rare earth mine that could possibly turn Wyoming into the largest producer of rare minerals in the world, knocking China out of the running. https://americanrareearths.com.au/cowboy-state-daily-rare-ea...

There are opportunities around the country to get ahead of growth.

 Yup path of progress is where fortunes are made no doubt .. but its also the strategy least talked about especially on BP.. dont know why .. I like the Rare Earth play.. that sounds like its going to be a major bonanza for work force housing. 

[Manny Darnell]

The Chips Act - Intel news is exactly why I’m looking at Columbus as my starting market. Great development and job growth opportunities. 

Currently looking into surrounding “trickle down” markets that are more affordable but will still benefit from the influx, so if anyone has any suggestions for an out of state investor they will be welcomed and greatly appreciated!

[Jay Hinrichs]

Quote from @Manny Darnell:

The Chips Act - Intel news is exactly why I’m looking at Columbus as my starting market. Great development and job growth opportunities. 

Currently looking into surrounding “trickle down” markets that are more affordable but will still benefit from the influx, so if anyone has any suggestions for an out of state investor they will be welcomed and greatly appreciated!

Keep in mind at least as it relates to Intel..  Columbus is down the list of priority for the company it will happen just not as fast as Oregon or AZ..  but I am sure there are other  companies expanding there but the premise is the same get ahead of were development is going. But one has to be careful that its not another Fox Conn situation that happened in the Milwaukee Wisconsin area.

[Marcus Auerbach]

I had a front fow seat to the Foxconn situation. Trump and Walker breaking ground with golden shovels, talking about 11,000 jobs, its a sure thing, investors going cracy, the same piece of land selling 3 times in a year, more than doubleing in price every time. And then - no factory.

Moral of the story is, you can be early and rake in a huge profit - or lose it all. Or you can be late to the party and pay more to get in, but don't have to worry about demand.

I can't say I am not day dreaming about things like this, but I am also a bit risk averse. I think it's fine to risk a small portion of your net worth on a gamble, but everything else means betting the farm.

Speaking of farm, here are 50 acres in Hilsboro for $3M https://www.zillow.com/homedetails/NW-West-Union-Rd-Hillsbor...

Dang, maybe if I..?

[Jay Hinrichs]

Quote from @Marcus Auerbach:

I had a front fow seat to the Foxconn situation. Trump and Walker breaking ground with golden shovels, talking about 11,000 jobs, its a sure thing, investors going cracy, the same piece of land selling 3 times in a year, more than doubleing in price every time. And then - no factory.

Moral of the story is, you can be early and rake in a huge profit - or lose it all. Or you can be late to the party and pay more to get in, but don't have to worry about demand.

I can't say I am not day dreaming about things like this, but I am also a bit risk averse. I think it's fine to risk a small portion of your net worth on a gamble, but everything else means betting the farm.

Speaking of farm, here are 50 acres in Hilsboro for $3M https://www.zillow.com/homedetails/NW-West-Union-Rd-Hillsbor...

Dang, maybe if I..?

Morning Marcus..  this is the exact point.. the property you highlighted is Way out of the possibility of development  EFU  means Exclusive Farm Use.. it would be difficult to build one single family home on that parcel given Oregon zoning and development laws. the play is adjacent to the city limits or urban growth boundaries or in the study areas.. Or infill .. And of course this is all state specific.. For myself I put a small group of investors together in 09 and optioned 120 acres that does border the UGB already has major roads and infrastructure fronting it and is 1 mile from Ronlar acres Intels largest Campus in the US.  And exactly no one in my little group is paying more than about 10k a year for this option.. We optioned it for 5.5 million and each annual payment is 100% goes to principal so no interest carry at all. Based on what Nathan Gesners relative is selling their 23 acres for  1 mil an acre we have about 100 to 120 million dollar prop once brought in. we have been approached by the big boys we got an offer last year of 20 mil and turned it down LOL  .. my partners are all younger than me and bought their options in their Roth IRAs  its a pretty cool long term play with some risk of course.. but oh such upside for them.. It will be tax free when it cooks off.. I just hope I am still alive when it happens. but it will happen we border the city limits there is development directly across the street. I may not see it but my kids and grandkids will be happy !!!  And well thats OK to. Its a legacy since I wont be leaving them any rentals to speak of.. this will have to do. :)

[Jay Hinrichs]

Quote from @Marcus Auerbach:

I had a front fow seat to the Foxconn situation. Trump and Walker breaking ground with golden shovels, talking about 11,000 jobs, its a sure thing, investors going cracy, the same piece of land selling 3 times in a year, more than doubleing in price every time. And then - no factory.

Moral of the story is, you can be early and rake in a huge profit - or lose it all. Or you can be late to the party and pay more to get in, but don't have to worry about demand.

I can't say I am not day dreaming about things like this, but I am also a bit risk averse. I think it's fine to risk a small portion of your net worth on a gamble, but everything else means betting the farm.

Speaking of farm, here are 50 acres in Hilsboro for $3M https://www.zillow.com/homedetails/NW-West-Union-Rd-Hillsbor...

Dang, maybe if I..?

[Jay Hinrichs]

Quote from @Jay Hinrichs:

Quote from @Marcus Auerbach:

I had a front fow seat to the Foxconn situation. Trump and Walker breaking ground with golden shovels, talking about 11,000 jobs, its a sure thing, investors going cracy, the same piece of land selling 3 times in a year, more than doubleing in price every time. And then - no factory.

Moral of the story is, you can be early and rake in a huge profit - or lose it all. Or you can be late to the party and pay more to get in, but don't have to worry about demand.

I can't say I am not day dreaming about things like this, but I am also a bit risk averse. I think it's fine to risk a small portion of your net worth on a gamble, but everything else means betting the farm.

Speaking of farm, here are 50 acres in Hilsboro for $3M https://www.zillow.com/homedetails/NW-West-Union-Rd-Hillsbor...

Dang, maybe if I..?

Marcus on this map our option is one the property in SB 4 B right above the blue box that says council approved purchase.. U can see city directly across the street  Industrial already coming to the East major thoroughfare on the south border and East border .

Nathans relatives property is in the green industrial coming soon..I suspect they bought it years and years ago for next to nothing.   but its maps like these and deductive reasoning to make these purchases..

I bought one in Rohnert park CA in 95 ish  4 acres for 27k that could not be built on .. but it was right behind a Home depot shopping center and there was a free way interchange.. took till 2020 but in 2017 it got brought into the city limits.. the Indians built the biggest Casino in N. CA across the street from us.. and we got upzoned to mixed use resi commerical and sold to a developer that was doing a land assemblage and that one cooked off for 2.2 mil cash.. so I dont know.. 27k plus 10k in prop tax's over a 24 year hold to then net 2.2 mil.. I never ran the math.. but one thing I do think is a 27k little rental in the mid west probably would not have made us that much money in cash flow and appreciation over the same hold period and we just mowed it about every 3 years .. Same thing I put two of my buddies together so we each has about 12k in cash into it and we each got what 700k back.. we had basically zero basis so we each 1031 into some other assets.

[Marcus Auerbach]

Quote from @Jay Hinrichs:

Quote from @Marcus Auerbach:

I had a front fow seat to the Foxconn situation. Trump and Walker breaking ground with golden shovels, talking about 11,000 jobs, its a sure thing, investors going cracy, the same piece of land selling 3 times in a year, more than doubleing in price every time. And then - no factory.

Moral of the story is, you can be early and rake in a huge profit - or lose it all. Or you can be late to the party and pay more to get in, but don't have to worry about demand.

I can't say I am not day dreaming about things like this, but I am also a bit risk averse. I think it's fine to risk a small portion of your net worth on a gamble, but everything else means betting the farm.

Speaking of farm, here are 50 acres in Hilsboro for $3M https://www.zillow.com/homedetails/NW-West-Union-Rd-Hillsbor...

Dang, maybe if I..?

Morning Marcus..  this is the exact point.. the property you highlighted is Way out of the possibility of development  EFU  means Exclusive Farm Use.. it would be difficult to build one single family home on that parcel given Oregon zoning and development laws. the play is adjacent to the city limits or urban growth boundaries or in the study areas.. Or infill .. And of course this is all state specific.. For myself I put a small group of investors together in 09 and optioned 120 acres that does border the UGB already has major roads and infrastructure fronting it and is 1 mile from Ronlar acres Intels largest Campus in the US.  And exactly no one in my little group is paying more than about 10k a year for this option.. We optioned it for 5.5 million and each annual payment is 100% goes to principal so no interest carry at all. Based on what Nathan Gesners relative is selling their 23 acres for  1 mil an acre we have about 100 to 120 million dollar prop once brought in. we have been approached by the big boys we got an offer last year of 20 mil and turned it down LOL  .. my partners are all younger than me and bought their options in their Roth IRAs  its a pretty cool long term play with some risk of course.. but oh such upside for them.. It will be tax free when it cooks off.. I just hope I am still alive when it happens. but it will happen we border the city limits there is development directly across the street. I may not see it but my kids and grandkids will be happy !!!  And well thats OK to. Its a legacy since I wont be leaving them any rentals to speak of.. this will have to do. :)

Wow, now that's one great way to leverage a Roth IRA! Seems to me like the risk is getting smaller each year, meanwhile the upside is growing.

It's a great way for the land owner to draw cash out of their land over a long time, softening their tax impact. How did that deal come together? Was it for sale for a while?

[Jay Hinrichs]

Quote from @Marcus Auerbach:

Quote from @Jay Hinrichs:

Quote from @Marcus Auerbach:

I had a front fow seat to the Foxconn situation. Trump and Walker breaking ground with golden shovels, talking about 11,000 jobs, its a sure thing, investors going cracy, the same piece of land selling 3 times in a year, more than doubleing in price every time. And then - no factory.

Moral of the story is, you can be early and rake in a huge profit - or lose it all. Or you can be late to the party and pay more to get in, but don't have to worry about demand.

I can't say I am not day dreaming about things like this, but I am also a bit risk averse. I think it's fine to risk a small portion of your net worth on a gamble, but everything else means betting the farm.

Speaking of farm, here are 50 acres in Hilsboro for $3M https://www.zillow.com/homedetails/NW-West-Union-Rd-Hillsbor...

Dang, maybe if I..?

Morning Marcus..  this is the exact point.. the property you highlighted is Way out of the possibility of development  EFU  means Exclusive Farm Use.. it would be difficult to build one single family home on that parcel given Oregon zoning and development laws. the play is adjacent to the city limits or urban growth boundaries or in the study areas.. Or infill .. And of course this is all state specific.. For myself I put a small group of investors together in 09 and optioned 120 acres that does border the UGB already has major roads and infrastructure fronting it and is 1 mile from Ronlar acres Intels largest Campus in the US.  And exactly no one in my little group is paying more than about 10k a year for this option.. We optioned it for 5.5 million and each annual payment is 100% goes to principal so no interest carry at all. Based on what Nathan Gesners relative is selling their 23 acres for  1 mil an acre we have about 100 to 120 million dollar prop once brought in. we have been approached by the big boys we got an offer last year of 20 mil and turned it down LOL  .. my partners are all younger than me and bought their options in their Roth IRAs  its a pretty cool long term play with some risk of course.. but oh such upside for them.. It will be tax free when it cooks off.. I just hope I am still alive when it happens. but it will happen we border the city limits there is development directly across the street. I may not see it but my kids and grandkids will be happy !!!  And well thats OK to. Its a legacy since I wont be leaving them any rentals to speak of.. this will have to do. :)

Wow, now that's one great way to leverage a Roth IRA! Seems to me like the risk is getting smaller each year, meanwhile the upside is growing.

It's a great way for the land owner to draw cash out of their land over a long time, softening their tax impact. How did that deal come together? Was it for sale for a while?

Well Marcus since its U and me on this thread. ( and I cant believe more BP members are not interested in learning about these types of investments)  but anyway here goes.

The property was originally optioned from the land owner who bought it in the 50s for next to nothing in today's dollars..The company that had that option that started in about 2002 also optioned it for 5 mil or so with annual option payments ( they were a large SFR builder as in larger Regional builder). come 08 and well that builder was one of many in the PDX market that had way to much inventory and the banks called most of their loans and he lost MILLIONS and pocketed much fo the last draws and actually decamped to Cabo and bought a resort at Cerritos beach that is still there today. Was big time local news etc.

We got wind of it through one of our Broker contacts.. the issue for the land owner is he had taken roughly the same option payments yearly 150k And now with the option failing he was going to have to capture all that income as earned income and pay tax.. ( which of course he is kind of like a lottery winner the 150k a year was always gone in 10 months) So he was in a potential bad spot with IRS and we were able to step in and take over the option for the same terms. Although we did extend it and we did negotiate that our option payment would be a full credit to the purchase price so NO INTEREST Carry for us.. We put 200k in cash down in 09 which was kind of tough for me given the situation at the time with all the defaults I had on my loans out in the mid west. But I came up with the cash and then  sold off 50% of the shares to the smaller investors for the 200k and got all my cash back so now I have zero cash in it and 50% ownership.. I then sold 50% of my 50% to another investor that pays my annual payment of 75k a year.. so long and the short of it is I ended up with 25% of this deal and zero cash in it and zero cash to hold it. Now as we know its totally illiquid and I just carry it on my balance sheet at a very low equity number.. However I have the right partners and at some point the land will be paid for although we hope to have it sold before then.. Also the seller who we have the option with retains 25% of the up side.. So if this cooks off at 100 mil they get 25 mil and our partnership gets 75 mil and we divvy it up. All my junior investors used their roth the partner I have that is paying the 75k a year for his 25% is a builder/developer like I am .

At first we thought this might come in as residential and our plans were big subdivision with small commercial center at the corner of Evergreen and Jackson school road.. but the Hillsboro long range plan and the state and the chips act has changed that as with our 117 acres and the props to the north we total around 350 acres that can be easily developed and that's what big companies are looking for..

So will see I know its not what 95% of the Cash flow buy hold BP members want to do and I get that. But I did want to point out that every city has its areas like these and there are huge upsides in Path of progress we all see it we all see the farmer that bought on the city limits 30 years ago and hit a huge payday..

My current 90 home project in Oregon was like that Farmer owned it for decades And when we bought it for 7. 2 mil cash they did not even do a 1031 just paid their cap gain and called it a day.

www.ivyridgeestatescanby.com  is the project and its been a winner.. albeit a few years behind schedule with pandemic and lumber and every other impediment.. ( could not get garage doors for a while :)  )

So hopefully if anyone actually reads this and has interest they will see the benefit of learning how to go into the cities look at long range planning get to know the long range planners identify movement we can all do it as small investors we do not have to be big corporations 

[Eric James]

I think all types of real estate investors are interested in path of progress. Even cash flow investors.

[Marcus Auerbach]

@Jay Hinrichs Thanks for sharing the backstory! Even better! What an awesome deal! 

I think this may over most peoples heads, because it is so next level. And not repeatable in the exact same steps like a step 1 to 3 recipie. The circumstances were shaped by a historic event. So it it truely next level stuff for a number of reasons, timing being the first.

2009 was an increadible tough year to come up with 200k in cash to buy a piece of paper!

The knife was falling and nobody knew how deep it would go. I was a total rookie, just bought my first duplex and was terrified.. Maybe your perception was different, but I remember the sense we had at Wacker Neuson going through rounds of layoffs, dealers defaulting, order cancelations and no sense when the construction equipment industry would recover, or if there would even be a full recovery - ever.. nobody had ever seen anything like it. 2008 was bad, I think Lehman Brothers collapsed in October, by 2009 we had to assume the equipment industry would never be the same. So yeah, that was a tough year to write a big check for a piece of paper! 

The average BP investor is worried today (!) - in a market that is both hot and extremly predictable and set in its direction - if they can break even on a property or chip in 200 dollars.

The rest of the story sounds like right out of Dolf De Roos' playbook. Selling of the pieces of the contract until you have no money in it. But wait, still not good enough. Next step you are selling off the annual option payment. At this point I am just shaking my head - wow, what a deal, well done. And: well earned!

[Jay Hinrichs]

Quote from @Marcus Auerbach:

@Jay Hinrichs Thanks for sharing the backstory! Even better! What an awesome deal! 

I think this may over most peoples heads, because it is so next level. And not repeatable in the exact same steps like a step 1 to 3 recipie. The circumstances were shaped by a historic event. So it it truely next level stuff for a number of reasons, timing being the first.

2009 was an increadible tough year to come up with 200k in cash to buy a piece of paper!

The knife was falling and nobody knew how deep it would go. I was a total rookie, just bought my first duplex and was terrified.. Maybe your perception was different, but I remember the sense we had at Wacker Neuson going through rounds of layoffs, dealers defaulting, order cancelations and no sense when the construction equipment industry would recover, or if there would even be a full recovery - ever.. nobody had ever seen anything like it. 2008 was bad, I think Lehman Brothers collapsed in October, by 2009 we had to assume the equipment industry would never be the same. So yeah, that was a tough year to write a big check for a piece of paper! 

The average BP investor is worried today (!) - in a market that is both hot and extremly predictable and set in its direction - if they can break even on a property or chip in 200 dollars.

The rest of the story sounds like right out of Dolf De Roos' playbook. Selling of the pieces of the contract until you have no money in it. But wait, still not good enough. Next step you are selling off the annual option payment. At this point I am just shaking my head - wow, what a deal, well done. And: well earned!

In all honesty I did not know how bad it was going to get otherwise I would have held on to that cash.. It worked out . but no doubt was a risk. And as I said above I hope to be alive and well when it kicks off but if not my kids and grandkids will find themselves with a nice legacy inheritance.  In the the meantime I just keep working away like we all do in this business.. its not work its a lifestyle. For me if I was not doing deals I would be bored to tears :)  only so much golf and fishing one can do .

[Jay Hinrichs]

Quote from @Eric James:

I think all types of real estate investors are interested in path of progress. Even cash flow investors.

I have to think Eric your market has seen ALOT of this just think of those that owned the dirt that Tesla bought !! or a number of other concerns moving to TX.

[Jay Hinrichs]

Quote from @Marcus Auerbach:

@Jay Hinrichs Thanks for sharing the backstory! Even better! What an awesome deal! 

I think this may over most peoples heads, because it is so next level. And not repeatable in the exact same steps like a step 1 to 3 recipie. The circumstances were shaped by a historic event. So it it truely next level stuff for a number of reasons, timing being the first.

2009 was an increadible tough year to come up with 200k in cash to buy a piece of paper!

The knife was falling and nobody knew how deep it would go. I was a total rookie, just bought my first duplex and was terrified.. Maybe your perception was different, but I remember the sense we had at Wacker Neuson going through rounds of layoffs, dealers defaulting, order cancelations and no sense when the construction equipment industry would recover, or if there would even be a full recovery - ever.. nobody had ever seen anything like it. 2008 was bad, I think Lehman Brothers collapsed in October, by 2009 we had to assume the equipment industry would never be the same. So yeah, that was a tough year to write a big check for a piece of paper! 

The average BP investor is worried today (!) - in a market that is both hot and extremly predictable and set in its direction - if they can break even on a property or chip in 200 dollars.

The rest of the story sounds like right out of Dolf De Roos' playbook. Selling of the pieces of the contract until you have no money in it. But wait, still not good enough. Next step you are selling off the annual option payment. At this point I am just shaking my head - wow, what a deal, well done. And: well earned!

Marcus I have one more comment on land deals.. and how folks get brainwashed into only one kind of investment IE cash flow..  when I started buying foreclosures in Atlanta metro in 2012 we got in before the hedge funds kicked us to the curb.. I was offered more than one Pipe farm.. A pipe farm in those days was a fully completed SFR subdivision with the utls ( Pipes) sticking out of the ground ready to hook up.. I looked at one which was 105 lots for 125k cash the whole thing.. probably cost 3 million to build it..  I went about trying to raise the money to buy it and at that point investors I talked to said NOPE does not cash flow LOL.. I am like come one..  builders snagged them and 3 to 4 years later are making huge profits since they had zero land cost.  I did buy 14 lots in one subdivision for 3k a lot these were great 1/2 acre lots with homes around them already. we held 24 months and exited at 30k a lot.  so that one worked nicely.

[Marcus Auerbach]

Quote from @Jay Hinrichs:

Quote from @Marcus Auerbach:

@Jay Hinrichs Thanks for sharing the backstory! Even better! What an awesome deal! 

I think this may over most peoples heads, because it is so next level. And not repeatable in the exact same steps like a step 1 to 3 recipie. The circumstances were shaped by a historic event. So it it truely next level stuff for a number of reasons, timing being the first.

2009 was an increadible tough year to come up with 200k in cash to buy a piece of paper!

The knife was falling and nobody knew how deep it would go. I was a total rookie, just bought my first duplex and was terrified.. Maybe your perception was different, but I remember the sense we had at Wacker Neuson going through rounds of layoffs, dealers defaulting, order cancelations and no sense when the construction equipment industry would recover, or if there would even be a full recovery - ever.. nobody had ever seen anything like it. 2008 was bad, I think Lehman Brothers collapsed in October, by 2009 we had to assume the equipment industry would never be the same. So yeah, that was a tough year to write a big check for a piece of paper! 

The average BP investor is worried today (!) - in a market that is both hot and extremly predictable and set in its direction - if they can break even on a property or chip in 200 dollars.

The rest of the story sounds like right out of Dolf De Roos' playbook. Selling of the pieces of the contract until you have no money in it. But wait, still not good enough. Next step you are selling off the annual option payment. At this point I am just shaking my head - wow, what a deal, well done. And: well earned!

In all honesty I did not know how bad it was going to get otherwise I would have held on to that cash.. It worked out . but no doubt was a risk. And as I said above I hope to be alive and well when it kicks off but if not my kids and grandkids will find themselves with a nice legacy inheritance.  In the the meantime I just keep working away like we all do in this business.. its not work its a lifestyle. For me if I was not doing deals I would be bored to tears :)  only so much golf and fishing one can do .

 Yeah, same. My two businesses are gameified, and I am just as excited sometimes as I was as a child when I was riding my bike to buy used computer parts using my friends piggybank money (my first OPM lol) and then sell a working computer for a profit!

[Carlos Ptriawan]

Quote from @Jay Hinrichs:

For investors who may look to diversify their portfolio or who are not 100% in the camp of ( if it does not cash flow its not an investment)

or appreciation  is ( gambling) if you have been following the Chips Act news this is going to create a lot  of path of progress opportunities for investors.

apologize but isn't there has been announcement that Hillsboro plant has been cancelled by intel ?

unless it's AI chip there's not much else of chip demand these days.

[Marcus Auerbach]

Quote from @Jay Hinrichs:

Quote from @Marcus Auerbach:

@Jay Hinrichs Thanks for sharing the backstory! Even better! What an awesome deal! 

I think this may over most peoples heads, because it is so next level. And not repeatable in the exact same steps like a step 1 to 3 recipie. The circumstances were shaped by a historic event. So it it truely next level stuff for a number of reasons, timing being the first.

2009 was an increadible tough year to come up with 200k in cash to buy a piece of paper!

The knife was falling and nobody knew how deep it would go. I was a total rookie, just bought my first duplex and was terrified.. Maybe your perception was different, but I remember the sense we had at Wacker Neuson going through rounds of layoffs, dealers defaulting, order cancelations and no sense when the construction equipment industry would recover, or if there would even be a full recovery - ever.. nobody had ever seen anything like it. 2008 was bad, I think Lehman Brothers collapsed in October, by 2009 we had to assume the equipment industry would never be the same. So yeah, that was a tough year to write a big check for a piece of paper! 

The average BP investor is worried today (!) - in a market that is both hot and extremly predictable and set in its direction - if they can break even on a property or chip in 200 dollars.

The rest of the story sounds like right out of Dolf De Roos' playbook. Selling of the pieces of the contract until you have no money in it. But wait, still not good enough. Next step you are selling off the annual option payment. At this point I am just shaking my head - wow, what a deal, well done. And: well earned!

Marcus I have one more comment on land deals.. and how folks get brainwashed into only one kind of investment IE cash flow..  when I started buying foreclosures in Atlanta metro in 2012 we got in before the hedge funds kicked us to the curb.. I was offered more than one Pipe farm.. A pipe farm in those days was a fully completed SFR subdivision with the utls ( Pipes) sticking out of the ground ready to hook up.. I looked at one which was 105 lots for 125k cash the whole thing.. probably cost 3 million to build it..  I went about trying to raise the money to buy it and at that point investors I talked to said NOPE does not cash flow LOL.. I am like come one..  builders snagged them and 3 to 4 years later are making huge profits since they had zero land cost.  I did buy 14 lots in one subdivision for 3k a lot these were great 1/2 acre lots with homes around them already. we held 24 months and exited at 30k a lot.  so that one worked nicely.

 I had a front row seat to the 2008 crisis working for a construction equipment manufacturer. I remember I spent a week in Vegas with one of our sales reps trying to shake up some interest for our new excavator line. We had a brand new 16,000 lbs machine on the trailer and really bad timing. It was the week after construction was shut down at the Aria City Center project. I think they let about 10,000 workers go. Contractors and dealers were so upset with us when we showed up with the new machine and asked them if they wanted to test drive it. Like we didn't read the room. It was depressing. After basically getting sucker punched all day we picked ourselves up over dinner and a beer and made plans for the next day to turn this arround. Same result next day. People were so depressed, we got yelled at and told to f# off. I flew home Friday, we had spent $800 on diesel, a bunch on hotels and meals and absolutley nothing to show for.. 

Monday morning we were discussing another round of layoffs at the factory. Construction equipment is very sensitive to economic cycles. Contractors buy a lot of machinery when they are optimisstic and have jobs lined up. And they buy absolutley zero, if the outlook is not great. Just look at the caterpillar stock price

[Carlos Ptriawan]

Quote from @Jay Hinrichs:

Quote from @Jay Hinrichs:

Quote from @Marcus Auerbach: and that one cooked off for 2.2 mil cash.. so I dont know.. 27k plus 10k in prop tax's over a 24 year hold to then net 2.2 mil.. I never ran the math.. but one thing I do think is a 27k little rental in the mid west probably would not have made us that much money in cash flow and appreciation over the same hold period and we just mowed it about every 3 years .. Same thing I put two of my buddies together so we each has about 12k in cash into it and we each got what 700k back.. we had basically zero basis so we each 1031 into some other assets.

 That's the fun part of "land" speculation right Jay ;-) lol 

btw that too is very common in asian country especially when the land is developed into resort , say something like in bali or thailand...

[V.G Jason]

Wyoming working from it will be like oil in the dakotas/bakken, no one will live there full time still but do turn rotations to make sure the work is done. It's not going to be like midland/permian, where some may live there and it's super pricey. 

Oregon and Arizona are absolutely going to run up from this, but I'm never comfortable investing outside of a STR in Oregon which are we working on now. I won't create a LTR portfolio there. Arizona I am open to as we already own some land that's already gotten very valuable there, just not sure what I want to do with it yet. I have some land in other parts of the country too where I tie it in with a prospective builder to give them a ROFR on building on it to a prospective land buyer. I charge them a demand fee, like an option.

[Jay Hinrichs]

Quote from @Carlos Ptriawan:

Quote from @Jay Hinrichs:

For investors who may look to diversify their portfolio or who are not 100% in the camp of ( if it does not cash flow its not an investment)

or appreciation  is ( gambling) if you have been following the Chips Act news this is going to create a lot  of path of progress opportunities for investors.

apologize but isn't there has been announcement that Hillsboro plant has been cancelled by intel ?

unless it's AI chip there's not much else of chip demand these days.

they are spending 30 to 40 billion upgrading Ronlar acres.. the demand is for associate uses. and other companies.. Not sure if they are building more fab plants .  So intel would not be the direct buyer of our land when it comes to market.. the question is not if its when and whether I will be cognizant enough to enjoy the massive windfall or it is just going to be my legacy to my children and grand kids.. Either way I am fine with that.  My day of wanting to buy a Jet is long gone :) that crashed and burned in 09 when the economy tanked and I had to start over.

[Jay Hinrichs]

Quote from @V.G Jason:

Wyoming working from it will be like oil in the dakotas/bakken, no one will live there full time still but do turn rotations to make sure the work is done. It's not going to be like midland/permian, where some may live there and it's super pricey. 

Oregon and Arizona are absolutely going to run up from this, but I'm never comfortable investing outside of a STR in Oregon which are we working on now. I won't create a LTR portfolio there. Arizona I am open to as we already own some land that's already gotten very valuable there, just not sure what I want to do with it yet. I have some land in other parts of the country too where I tie it in with a prospective builder to give them a ROFR on building on it to a prospective land buyer. I charge them a demand fee, like an option.

are you doing STR on the Coast ?  Or ?  there could be some good plays for office downtown PDX as it has the highest vacancy rate in the nation for established cities of its size.  Thanks to super weak governance during the BLM riots Antifa and homeless.. allowing open air drug use ( legal drugs) and the killer theft under 900.00 is not enforced causing rampant thievery and many stores to close kind of like We see in the mid west and rust belt when neighborhoods change and retail exits as its not sustainable.

[Carlos Ptriawan]

Quote from @Jay Hinrichs:

Quote from @V.G Jason:

Wyoming working from it will be like oil in the dakotas/bakken, no one will live there full time still but do turn rotations to make sure the work is done. It's not going to be like midland/permian, where some may live there and it's super pricey. 

Oregon and Arizona are absolutely going to run up from this, but I'm never comfortable investing outside of a STR in Oregon which are we working on now. I won't create a LTR portfolio there. Arizona I am open to as we already own some land that's already gotten very valuable there, just not sure what I want to do with it yet. I have some land in other parts of the country too where I tie it in with a prospective builder to give them a ROFR on building on it to a prospective land buyer. I charge them a demand fee, like an option.

are you doing STR on the Coast ?  Or ?  there could be some good plays for office downtown PDX as it has the highest vacancy rate in the nation for established cities of its size.  Thanks to super weak governance during the BLM riots Antifa and homeless.. allowing open air drug use ( legal drugs) and the killer theft under 900.00 is not enforced causing rampant thievery and many stores to close kind of like We see in the mid west and rust belt when neighborhoods change and retail exits as its not sustainable.

 I think bigger plant would be in phoenix Arizona when tsmc move to AZ.

Also as intel losing market share to amd, some of their plant was in New York. 

I checked Hillsboro OR is basically already established site of Intel r&d….

But if I am the land speculator I would follow whee tsmc is lol this chip act is about moving production from China to US.

This trade war is extremely serious to tech company bottom line , in Asia some of tech products are moved to Chinese product following CCP instruction , while in Europe and canada and obviously here Chinese product is forever banned lol lol lol

[Carlos Ptriawan]

Quote from @Carlos Ptriawan:

Quote from @Jay Hinrichs:

Quote from @V.G Jason:

Wyoming working from it will be like oil in the dakotas/bakken, no one will live there full time still but do turn rotations to make sure the work is done. It's not going to be like midland/permian, where some may live there and it's super pricey. 

Oregon and Arizona are absolutely going to run up from this, but I'm never comfortable investing outside of a STR in Oregon which are we working on now. I won't create a LTR portfolio there. Arizona I am open to as we already own some land that's already gotten very valuable there, just not sure what I want to do with it yet. I have some land in other parts of the country too where I tie it in with a prospective builder to give them a ROFR on building on it to a prospective land buyer. I charge them a demand fee, like an option.

are you doing STR on the Coast ?  Or ?  there could be some good plays for office downtown PDX as it has the highest vacancy rate in the nation for established cities of its size.  Thanks to super weak governance during the BLM riots Antifa and homeless.. allowing open air drug use ( legal drugs) and the killer theft under 900.00 is not enforced causing rampant thievery and many stores to close kind of like We see in the mid west and rust belt when neighborhoods change and retail exits as its not sustainable.

 I think bigger plant would be in phoenix Arizona when tsmc move to AZ.

Also as intel losing market share to amd, some of their plant was in New York. 

I checked Hillsboro OR is basically already established site of Intel r&d….

But if I am the land speculator I would follow whee tsmc is lol this chip act is about moving production from China to US.

This trade war is extremely serious to tech company bottom line , in Asia some of tech products are moved to Chinese product following CCP instruction , while in Europe and canada and obviously here Chinese product is forever banned lol lol lol

 But in middle is tsmc lol

whether this Taiwanese company is moving to arizona or we ban you too lol

[Mark Brown]

As a former employee at Intel, former resident of Hillsboro I agree this positions investors uniquely to benefit from this. Namely with the increases in land value and housing. My only question would be does this indicate that new housing will be built (i.e. more supply = less demand & appreciation) or more buyers inundating those class A markets (i.e. capped supply = more demand & appreciation). Or would it just even out and have negligible effect (i.e. more supply & equally more demand = nominal gains in appreciate or appreciation stasis).