Developer called said they want to buy my property, what do i do?

[Rudy Avila]

Hello Bigger Pockets members wondering if anybody has experience in this subject. I have a property right in the middle of a growing city. Its a duplex non conforming, now its zoned commercial. My 1.5 acre property is on a block that everyone knows will be developed sooner or later and today I got a call from a developer saying they want to buy my property for cash and asked how much do i want for it. I said i dont know you tell me? My property currently is cashflowing $2,550, plus looking to rent another room out for another +$800 a month should be rented for that amount within a month or 2,  plus my plans this year is to rent that extra acre left over for another $500 a month more. I explained to them that, so they can see im not just a homeowner with the property doing nothing and that its already doing good for me. Whats happening in the city is an Aldi just went up on the same block few houses down, across the street from that a very big shopping center is going up with a Sonics restaurant and more, what triggered this is a huge company came to town. It will be fully built in the next 3 month (after 2 years of building it) with 600 new jobs. When they call again i will say to them again i am interested in selling but for a price that ill make money on if not it wont be worth it for me because Ill Still make the same amount of money they want to pay me in X amount of time Plus still have the property. Any suggestions what to do? Tell them I want a big amount now or hold off till things get way hotter and then sell? if so anybody hold off so long that they got a very huge payday? Thanks 

[John Warren]

@Rudy Avila you should reach out to several local realtors, especially those that are in the commercial space. You need to get a handle on how much your property is worth today, and more importantly, the future value of the property. The commercial brokers that are working with developers would be a good place to start I would think. 

On a more simplistic note, if you are getting great cash flow then you should figure out how many years of cash flow you are recouping when you sell. If you are only recouping a few years, it may not make sense to sell. If you are getting 15-20 years worth of cash flow then why not?