Hello BP Family!
I have been dabbling in farmland for 14 years and am interested in getting your experienced opinion on how to begin getting investor capital.
The farms I Target have a 5% ROI from Agricultural farmland rent. With an average of 5% annual appreciation.
There are lots of statistics I have for more in depth review of this subject but the question I have is this.
I am looking to begin partnering with people who are interested in hedging their assets into a very solid (4.079% annualized return since 1919, 5.806% since 1969) investment. But I have only partnered with one very close friend before (and on a small scale) and am looking for larger investors.
Considering the returns are small (yet stable) I am unsure what percentages my company should receive .
I am starting with the idea that each investment should yield my company 2% ownership of attained asset and receive a 3% management fee based on gross income after property tax.
the scenario I see would look like this.
$1,000,000 investment.
Investor receives $49,000.00 - 3% management fee of $1,470.00 = $47,530.00 annually.
Of course there are loads of variables with the first being purchase price, second being acts of God. But there are No roofs to fix , no walls to paint and almost never tenants to evict (Farmers, once vetted, are some of the most honest people you could possibly ever deal with).
What do the high net worth investors out there think?
Any feedback is appreciated!
Thanks!
