What to do with Commercial Land in Washington-Balti Metro Area

Question

Hello Everyone, I need help on what to do with my commercial land in Odenton, MD. It is located on Rt 175 right front of Ft. Meade, Maryland. It is a little less than 1/4 acre between Dunkin Donut and BP gas station. It is zoned for pretty much any retail and office use. It is in redevelopment area, and has good potential, but it's drawback is size (only 0.22 AC). Currently, I do not have enough money to build a building myself due to financial difficulty I had about 5 years ago. Although I am financially OK now, I will have hard time getting any construction loan. My other option is to sell using a commercial broker, but these guys are seemed only interested in selling at least million dollars plus project. I hired a small commercial broker, but all he did was putting it on the online listing, and put a sign at the property. I know it takes time to sell commercial land, but I am getting very frustrated. Any advise? Thoughts? Ideas? Below is the map/pic of the location.

https://www.google.com/maps/@39.104607,-76.7221145,3a,75y,73.01h,85.14t/data=!3m6!1e1!3m4!1snJ7AAQgHWmU5bRx58g4X-w!2e0!7i13312!8i6656

Thanks!

https://www.google.com/maps/@39.104607,-76.7221145,3a,75y,73.01h,85.14t/data=!3m6!1e1!3m4!1snJ7AAQgHWmU5bRx58g4X-w!2e0!7i13312!8i6656

Thanks!

Joel Owens · Answer

Looking at it quickly  .22 acres is VERY TINY for retail commercial and hardly any tenants can fit on a site that size.

I have seen a 500 sq ft coffee type drive thru only freestanding constructed before on such a site. Most tenants minimum want 1/3rd of an acre and usually 1/2 an acre.

The Dunkin Donuts has the corner next door but parking looks limited. You could likely sell your piece to them to put additional parking on for their customers or you could lease the land to them for overflow parking.

I think 250k to 300k for it is a pipe dream.

People tend to look at a 1 acre corner that goes for 1 million and say if that was an acre for 1 million then my .22 must be worth 300k. That is simply not how it works.

1. The million an acre was for a corner and a red light with dual access for traffic counts on both roads.

2. The types of tenants that can put their site on a 1 acre parcel is vast as it is an optimum layout size for many  so they pay a premium for it.

I do not know land values where the site is but I do small retail development.

Have you thought of a billboard or cell tower on the site? That might be something that could fit there.

The question is do you want to hold the site long term for income or cash out the site at a reasonable value to go invest in some other asset class?

No legal advice given.

Andrea O. · Answer

@Megan Caplan Can you share details about your Eldersburg lot or PM me?

Megan Caplan · Answer

@Jordan Kim, curious to find out what you ended up doing with this land.  I have a similar situation in Eldersburg and I am trying to think of options.

I hope to hear that you found a good outcome.

Shane Mcc · Answer

Rent / lease the land to a local car dealership/auto repair facility. They can either put up an annex or use it for storage.

Jordan Kim · Answer

@Russell Brazil  Thank you for your advice Russell.  :)

Jordan Kim · Answer

@Joel Owens  Thanks for the good advice.  I do agree it is a small space, but my initial search (engineering study from previous owner) indicated that you can build about 1200sf retail building with about 8 parking spaces with this particular zoning.  And Price of 250k to 300k was estimated previously from two different commercial broker without any of my hopeful wishes ;) being added.  I may consider Cell tower or billboard later, but I prefer not to since having a retail building is more desirable.

I do not have a huge problem holding on to it, but I prefer to either sell it or build a small retail building.  One possible scenario is to have a investor come in to build a building, and go partnership(?) since I owned the lot.  I will have my loan completely paid off in 6 month.

Jordan Kim · Answer

@Bethanie Kollbaum Thank you Bethanie!

Bethanie Kollbaum · Answer

Hi Jordan, another option to sell your commercial property is to look into some CRE data and analytics tools. Some of these tools should have ownership portfolios and give you the option to research commercial real estate owners in the area of your property. You can use the data tool to get their contact info and immediately contact them if they are interested or know of anyone interested in purchasing your property.

These CRE data tools should have scaled pricing depending on what information you require, so some are pretty reasonable. For best results, look for one that gathers its data from multiple sources and verifies it rather than by manual collection.

Hope this is useful!

Russell Brazil · Answer

A quick glance of the area and I see a half acre commercial lot not selling at $180k. I'd adjust expectations downward on the value of the land. Also you might have to pay a flat rate commission as 3% of $150k just isn't worth anyone's time to deal with. You will probably need to pay at least a $15k flat rate which will be about 10% of the properties value.

Jordan Kim · Answer

@Russell Brazil Thank you for the quick reply.  Yes that would be an option also.  Do you happened to know any good commercial broker who may do a good job at marketing this land?   Land was estimated at $250k to $300k even though it is small.  But not many commercial broker seems to be  interested because due to relative small commission compares to millioin+ dollars listings.

What to do with Commercial Land in Washington-Balti Metro Area

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