Help needed in vetting investment plantation property in Brazil

[Fred Stevenson]

In addition to the bigger pockets webcast, I also frequently listen to the real estate radio guys podcast to further enhance my education. They had a show recently with a speaker from an investment firm offering opportunities to buy sections of cashflow producing agricultural land in Brazil. The arguments were made for investing in agricultural real estate, and Brazil in particular. I spoke to the company managers, and they are going to put me in touch with some of their current investors who have visited the plantation. I'm looking for some advice in terms of how to vet an foreign investment. Their proforma shows a IRR of 18% per anum over 20years. However, year 0 - 6 has 0% return, and then it escelates from their and from year 8 to year 20 the returns are in excess of 40% cash on cash per annum. I'd be happy to email the proforma's to anyone that may be able to help me vet this opportunity. Thanks.

[Mark Creason]

Fred,

Part of the reason for the slow payoff is that they will be planting something that takes time to harvest.  Have you ever been to Brazil?  I think you could find far safer deals here in the US.  I see deals every day that have 10%+ cash on cash.  Why would you go to a country where it would be easy to rip you off.

Mark