118 acres with road frontage off the highway in city limits

[Logan Ingram]

Investment Info:

Other buy & hold investment.

Purchase price: $155,000
Cash invested: $155,000

118 acres with highway frontage. 8 acre lake. Some mature oak trees. Two access points. One on eastern side connected to the main st in Higginson. One connected to Main St near Highway 167 (Future Interstate 57). Property was allowed to degrade and was/is overgrown with invasive Bradford Pear trees.

What made you interested in investing in this type of deal?

118 acres that close to town, undeveloped with great access to the highway. It was annexed into a nearby city over 10 years ago but the city never provided utilities. It presents a very unique opportunity to detach it from the city limits to remove undue restrictions that have affected the value and use. This will free the property up for multiple uses as well as development types that are not allowed within the city limits.

How did you find this deal and how did you negotiate it?

I have a friend who works at a local bank that keeps an eye out for bank owned properties that could be good investments. The bank took it when the owners still owed $295k. The bank tried to sell it for $299 for a few years. At the time I bought it, it was listed for $199k. I approached the bank (representative) and explained all the barriers to any one buying it for that price: zoning, restrictions, vegetation growth, etc. I offered $150k and they countered at $155k.

How did you finance this deal?

Family money

How did you add value to the deal?

We have brought in machinery and have cleared a good portion of the property as well as access points. I am also in the process of removing all city restrictions by detaching it from the city.

Lessons learned? Challenges?

I would have bought it myself (100% my deal) and done a few things and done a quick sale after some work to the property. I also could have done it all myself and have started an RV/mobile park surrounding the lake.

I should have kept myself quiet about all of my plans and my findings (de-annexation options).

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

No. I actually had the agent go and tell others in the area about what I was doing and the bank received a full price offer 5 minutes after they signed my contract. The property had no offers in 2 years. Kind of interesting that they received a full price that quick when I got involved. I would not have told the agent all of my plans.