Land Contract situation. Creative business deal :)

[James W.]

I'll be brief to start. I may start a new thread with more details, but hopefully the mods will work with me :) .

I'm in commercial and residential REI. Looking to expand my commercial side on this deal.

It's a raw land purchase, where I would buy and develop.

Owner is retired, out of state, decided to sell rather than hold. I could buy the land but it would take me a couple years to pull money from other holdings to continue the development, so here's my idea.

They give me the property on a land contract. I have the right to develop. I pay them X (~$25k/year) for 5 years, or longer, with a balloon payment at the end of our contract.

I am able to build my business on the property. They get to avoid the higher tax rate because they are collecting smaller chunks of cash per year, rather than the entire amount at once.

The land is a little under 200k. Development will end up being an easy 500k over the next 4 years.

I think my main concern is that I haven't done a land contract on commercial property, and I'll be sticking quite a bit of cash into developing the property before we actually complete the deal... and I don't want to risk losing my time and money over something stupid.

So... any of you have experience with Land Contract commercial deals?

TIA and bigger pockets = <3 !!!!