All Forum Posts by: De Rasche

One thing from Sam Zell that I use is determine "what is the worst that can happen?"  Sm says once you assess the risk and decide you can survive it, then move forward after appropriate due dilligence.  

Matthew

Good advice you received above.  My developer friends do not care for logged timber land as they say the stumps will cost more to remove than the money you made from the logging.  Now in our area that is usally because it is pine and the price is down.

If the bid from a logger or broker is for hardwood and more valuable, then math wins in the decision.

it will take years for hardwood stumps to rot on their own and less time for pine stumps.  If you are selling to a developer then the time frame from logging to potential sale should factor in the stumps.  Once stumps are there and it is going to be a few years before sale to adeveloper, then hard to keep cut with a bushhog with all those stumps and tree tops left behind.  PS loggers alwas promise not to leave limbs and tops behind but...

We are about to do 10 acre lots on 400 acres.

A wise friend advised us to lidar scan the area to determine best location for roads and lots.  Then select cut by pushing tree over first then cut log (trackhoe can do) only in areas for roads, etc.  

Then buyer who may want a wooded lot has trees, if buyer not want, then we can cut for them then.

We will add the value of the lumber on the lot sale price as wooded lots here are diferent and thus more valuable for the folks who want that product.

hope this helps,

De

You have received great advice above. 

I am in the area and have worked all over Memphis.

If you send me the number and street, I may be able to give you input.  Some streets here change by the block as to issues.

Second the good advice above and in our area if over 4 acres then you are not selling a lot, but a farm.  

Whole set of easier rules to go through for zoning and sale.  

If you sell over 4 a year they figure you are bypassing the subdivision approval process and restrictions.  

We still put a covenant in the deed to restrict negatives that may harm neighbors land value.

Also, our area requires 1.5 acres minimum for sewer and thus minimum lot size in your area for septic (if no sewer available) can be found out by calling zoning office or a friendly developer may be able to help.   

The best deal of my life came about when an agent sold a property out from under me.  I even had a cash offer in that they never presented.  Thought about legal action and instead got educated with good advisors and found a gold mine with that unspent money.  Find people you can trust and communicate well with to find a better deal and replace this one.

20 yeaars later the deal I wanted was worth about the same $ and the replacement property worth 10 fold.  

Will,

Memphis is an investors paradise for homes with signifigant per cent or so of home sales to non-Mmemphians.  They are offering sight unseen and then confirming with an inspector.  Lots of reasons for the low costs.

I personally am not in that market other than as a real estate agent.

Email with any opinions I can help.

You are correct in your assumption folks are selling without knowledge of what is coming.  Most of it is public record and I keep up to help my listings and for the investors I shop for to know if their area is going up the bell curve or down .  I have indistrial developer friends who know where the jobs are going and makes me know why politicians get rich.

Let me know how your deal works out.  

My niche would be to look for 20 plus plus acres (economy of scale) with lots of road frontage just outside that tourist area and in the path of the new growth.  Then sell off 10 at time for a higher price so the hold is minimal invest cost.  Buying the current "spot" is top of the bell curve property in cost and the "old spot" in ten years, so take your time.

enjoy your journey

D

Cows are inexpensive right now, which is good for geting in and bad news if you are having to sell.

My pasture renter is about to retire and he just took a financial bath selling his cows. 

Raising cattle is tough, so if you have limited experience doing so, you might want to buy an exisitng farm that is well managed and you can retain staff. 

kristen

Just in case you have not found an answer...

Lots of unknowns here.  Road frontage is a good thing normally, not sure if it is a 1.2 mill good thing.  Especailly if this isa new build, check with state highway for access to the road if a state road.  Some hway departments limit the access to an area with a cut through if a divided road, thus the road frontage gives you more options.  Run your plans by local zoning and highway folks to make sure you are "ok" and you can do a contract with that "OK" as a condition with a time limit for a contingency.  Our closing attorney is usally good at helping us word this type issue and we are real estate agents and still defer to his legal expertise.

Will

We bought the land about 6 miles out of Memphis.  We chose that area because there is 10000 new jobs in last five years and another 250000 on the way.  The highways locally just widened and an intermodal rail is now open.

We plan to develop and we chose at my age to only get properties that we can do that in the next 5-10 years.

We do have other land purchased in my thirties that was a long term hold and lots of memories with kids and bonfires on that land.  Good fortune or God watching out for me put a highway open near it and now suburbs join it.  

We have three contracts that close Jan. 15th, so we did not have a partnership agreement (pre-nup haha).

A local closing attorney will probably have a template if you go the general partnership route.  I listen to Sam Zell interviews to educae on real estate and it is all about risk assessment for his decision to buy or not.  A partnership puts your partner's performance as risk on you, so be wary.

You seem to be choosing a manageable buy and just check out other options in the area before you settle. To help decide, go to zoning and industrial development board' offices and they can show you what is coming down the pike.  Usually the folks in those offies are very helpful in our area.

Our closing attorney was going to form a general partnership if we chose that route and under $1000 to do, closer to $500. 

My friends and I just did a group purchase.  But we split the land up that was in part chosen because the road frontage allowed us to divide it.  We have three contracts at purchase or you could have one contract (don’t like this option personally), form a type of partnership and absolve after closing with the land split up.

If you go the route you are suggesting, I would suggest an extensive agreement through a lawyer for the what if’s.  What if one of you is no longer able to make decisions, what if one wants to sell and the other days no, what if one wants a $50000 gate and the other no gate, what if one gets divorced and it was not their wish?  The list is never complete, this we partner on the search, but separate at closing.

Hope this helps.

Dennis