Group Efforts? Revitalize a WHOLE TOWN?

Question

Many communities have been devastated by natural disasters. Has anyone ever tried to bring a group of investors together to rebuild a town? One where most of the homes were damaged or destroyed as were businesses. The people never came back and the businesses never had a reason to reopen. I drove through one of these recently (one of the saddest things I've seen) and thought, a pool of investors all doing individual fix and flips or fix and holds could revitalize a town. Once the houses started coming back so would the businesses.

What are your thoughts?

Andrew Garcia · Answer

Hi @Greg Carroll, the biggest issue I see with this strategy is that you need people to buy the flips or rent the newly renovated properties.

Sure, some people can afford that but if you were to do it to the whole town, you would have listings sit for months.

That would likely be your biggest obstacle.

It would be great if you could pull it off, however.

Hope this helps! Let me know if I can be of any assistance.

Roger Flot · Answer

Its an interesting thought.

I guess my first question would be 'what was the town's original purpose and could that be recaptured?'  Every town should have a reason -thats why people originally moved there to begin with.  If that can be recaptured, then that is your initial pitch to investors.

Next, ' how much of the infrastructure remains?'  A tornado can be devastating, but it usually leaves plumbing alone... if there was underground wiring, that should be intact as well.  But if it was an earthquake, then there could be dangers underground unseen.

Finally, what is the prospect to give confidence to buyers that their investment will be safe going forward.  Probability of recurrence is going to be a mental hurdle to many.  I am amazed at the way folks along the California coast rebuild through the yearly fires and mudslides.  Are there preventative measures that can be taken to insure that probability can be lowered?  And whats the plan if it happens again.  The recovery along the gulf coast with Katrina could provide lessons as many smaller burgs were forced to decide if it was worth rebuilding again.

PS: will the local government be on board with the revitalization?  I know in Puerto Rico, while there is desire to invest and fix it the way the investors want - the local governments are wary and can become overly involved and intrusive. Maintaining historic integrity (if any exists) can add to cost of overall project as well.