How to Monetize his Vacant City Lot?

Question

I was hoping some sharp minds here could give me some ideas in my situation.

I own a vacant city lot in my city, it's right across the alley from my home.  I inherited it over 20 years ago and it's basically a liability more than anything (meaning, it costs me money with no prospect of making me money).  Taxes are cheap (less than $100 a year) but I have to spend time with upkeep.

Here are the details of the land and what I have looked into to monetize it (and failed), with a diagram in case that helps.

Land details:

• Zoned Residential
• Situated next to (but below) the busiest road in my city.
• About 8,000 sq ft (with about 1/5th being an embankment)
• Irregular shape/contour
• No utilities at this time.

Monetization I have looked into (and failed)...

• Build a small home on it and rent it.  NOT ALLOWED. City will not allow development of a home on the lot.
• Rent space to billboard company - Called 2 billboard companiesNOT ALLOWED - city does not allow any new billboards to be erected inside the city limits.
• Build multi-bay garage and rent each bay out for car storage NOT ALLOWED - local law prohibits erecting of secondary structures without a primary structure.
• Rent to seasonal businesses like flower tents, local farmer, etc. Land is not 100% ideal for this (you will see in the diagram, it sit below the major artery road) but any rent would be worth considering.NOT ALLOWED - property not zoned commercial.

If any of you have any suggestions on how to monetize such a property, I'd love to hear them.  I'm fresh out of any ideas at this point.

Here's a diagram of the lot in case that helps...

Larry Tanner · Answer

That's no the case with this property.  My great uncle built the house I live in and bought that vacant lot at the same time.  He never developed it because he used it for pleasure (big garden, picnic parties, etc.).

What happened later, after he died and right before it was left to me by his wife (my great aunt), that big highway was put in and the govt took a good portion of the land.  Then, after the project was complete,  they gave some of it back (the embankment).  essentially, the land used to be worth something as it was able to be developed.  But when the road came through, that seemed to have really ruined it's potential.  My great aunt got a bad deal because they paid her for the land, but they did not pay for for the loss of potential lol.  Eminent Domain is great!

Chinmay J. · Answer

That was just an example... Doesn't have to be a church.. But any non profit...At least worth a question to city officials.

Scott Mac · Answer

HI Larry,

Strange they won't permit a new house since it increases the tax base?

Maybe increase your own home value by petitioning the local government to close and abandon the alley and deed it over to you and your neighbor, (though it would still probably remain an easement).

Then fence the whole of your property as one unit, and sell it as a large lot property in the city.

Also, most of these empty older city lots had a home on them at one time that either burned or was condemned.

When they razed a structure in the old days they would just push the debris from the house into the foundation and level the foundation to just below the dirt.

Meaning there might be a full basement there just below the grass (full of debris), that might qualify as a rebuild or an addition of sorts, instead of new construction.

If they allow this, you can look for the old basement by driving a rebar at a 45 degree angle into the dirt after it rains. Start from the front of the lot and go backwards.

Good luck!

Shaun M. · Answer

@Larry Tanner, Are you allowed to park vehicles on it? Sometimes you can get around billboard codes by using an old box truck with branding on the side.

William Jenkins · Answer

Larry, all I can say is that if you go down the variance path, you will likely have a reasonable amount of professional fees that you will have to pay (survey, elevations, application fees, etc.).  That will not guarantee you a approval, and you could be out those costs.  You can likely avoid the cost of an attorney and should be able to represent yourself prose.  An attorney is always an option if you want to press the issue.

I don't think you have anything to lose by meeting with the City.  I've done work in that area of the Country, and I know what you are talking about in terms of dealing with government there.  Perhaps you can become one of the insiders.

Larry Tanner · Answer

I forgot to mention, as far as the alley is concerned, it is city-owned and cannot be bought.  And I did ask about joining my home's lot with the vacant lot, they say "no can do" because of the alley separating the 2 properties.

I think it's going to take a lot of legal fees to get the city to allow me to do anything.  That's the way it is around here, unfortunately.  It's very incestuous.  There are folks around here that know the "right people" and seem be able to do whatever they want/need.  I'm not one of those people, unfortunately.

William Jenkins · Answer

Assuming the lot is in an area that makes development economically viable (can you really build a house and rent for a good ROI???), you should first go sit down with the City and see exactly what the issue is with building a house.  I would bet $100 that it is because of the lot shape and your inability to meet the required building setbacks.

If that is the case, there should be an ability for you to apply for what is called a "setback varaince."  For a variance you typically have to prove a hardship and that the unique features of your property (topography, shape, etc.) prohibit you from using your property (i.e. can't build anything on it).  These are typically public hearings before the Board of Adjustment (may go by another name in your area), or City Council.  I have obtained quite a few over the years... Some jurisdictions are tougher than others.

It is worth a shot if the payoff is there on the development side.

Chuck H. · Answer

Can you replat it so it is one unit? You'd have to grant an easement to your neighbor for the alley. Or is the alley city owned?

That way, you could do the garage idea.

Or turn it into a "free" neighborhood dog park. Ask whoever uses it to contribute to taxes and to help maintain it.

Larry Tanner · Answer

Aaah.  I understand.  Might be worth looking into.  It's EXTREMELY hard dealing with the Zoning people in in my city.  Very hard to get answers to questions.  But I will have to try, try again.

My preferred goal is to not sell it as I know it is not worth much.  I prefer to actually do something with it that can bring in revenue.  If all the revenue does is pay for the taxes and maintenance, then I will consider it worth keeping for at least the next 20 years.

Larry Tanner · Answer

The alley is paved on my portion of the property but only because I paved it about 15 years ago.  It needs repaved. I paved it because I have a garage that is accessed via the alley.  I paved it because it was shale and hard to maintain.  The rest of it up to the dead end is now weedy turf that my neighbor maintains (used to be all shale at one time)

How to Monetize his Vacant City Lot?

Land details:

Monetization I have looked into (and failed)...

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