All Forum Posts by: Jeff Kovac

Matt Studer Congratulations on venturing into energy related real estate activity. Your plans should take into account your proximity to the core drilling areas and the projected growth of the field. Most (but not all) current drilling activities is focused mainly on NAT GAS Liquids and Oil. Knowing what resources are being targeted in your area will help you understand more clearly how the energy activity in that area may progress. How far are you from the core drilling activity? What stage is the field experiencing - Exploratory, Development or Production? Are you in the path of the field's projected growth? Have they leased mineral acres in your area? Are drilling permits actively being issued, drilled and secured. Any time you can talk to employees of oil service companies you have the opportunity to gain information about the field's direction and growth. How large is Victoria? What is the current housing inventory? What are the vacancy rates? You may have an opportunity to capitalize from this Energy related activity but keep in mind that they can create a compressed and accelerated economy. Understanding the existing housing situation, the stage of drilling and development as well as the trends and direction of the field will greatly enhance your chances of success.

Regards,

Jeff

Thanks Brandon Turner, I appreciate all the help.

Thank You for your thoughts Bill Gulley, and that is much more than a dimes worth of input! To briefly explain - I'm not eliminating options as I move from one to the next, I'm gathering starting points and considerations as I map and investigate the mechanics of each option. (I'm not in a hurry, its how I process) As I research a topic(s), for me it helps to have an understanding of the scope and type of information I'm looking for. This helps me be more efficient in my efforts. Many times I stumble across and discard what, at the time, seems like irrelevant data only to find out later it was part of a separate but parallel search.

That's probably about as clear as mud but I hope it sheds some light on my method.

These posts have provided a host of information across a wide range of topics. Now I have a better understanding of what to look for in my search(s) and when I pursue one line of thought I can gather as much relevant information as possible.

In North Dakota, the economy is moving so swiftly that, once you put the word out on property availability you promptly receive numerous inquiries of interest. My meetings have been arraigned by the caller and my participation has been passive - to listen and ask questions for clarification with no implication of commitment. This is a land owner's market and the property is owned free and clear.

The members of BP that have posted a response, you included Bill, have supplied me with the points I need to map out and run a successful in depth investigation - My Thanks to Karen Margrave, Will Barnard, Brandon Turner and to you Bill, and if you, or anyone else has more input, by all means, feel free to add your "dimes worth" as well.

With Appreciation,

Jeff

Thank You Karen Margrave, for calling in the troupes. As always, you are most helpful. I'll message @Joel Owens and keep you posted on progress.

Trusting your projects go well,

Jeff

Thank You Karen Margrave, Will Barnard & Brandon Turner, for your time and input.

Update - Closed on property.
Meetings and phone calls yesterday.
Meeting with developer & RE agent today.
More to follow.
Moving forward with your advice in mind.

If there is anyone with additional thoughts, please feel free to contribute. I'm moving on from "what" are my options, to more of a "What to expect if you choose to partner" - Pros & Cons.

I haven't had anyone address the "ground lease" topic so, unless someone else has something to add or a direction to send me, I will look elsewhere for input.

Thanks Again.

By the way Will, If I flip the property, I may consider a 1031. Have you come across a minimum dollar amount or a lower threshold where a 1031 stops making sense?

Jeff

Thank you for the welcome Will Barnard and Jenkins Ramon. BTW Will, I am following your 1031 thread with interest and hope things go well for you. Thanks again to both of you for the welcome.

That sounds fine Karen Margrave and thank you for considering my situation. BTW the title company called me this afternoon and it turns out that the property owner was in state, he stopped and completed his half of close. We will complete close by weeks end.

Thank you Karen Margrave, for the information.

Would it help to look at it like this.
In a conventional economy, this scenario seems to be similar to a land purchase on the edge of a community. That city has now grown and is surrounding the parcel, increasing value and opportunity.

In this example the "land" is the small communities and the "city" is the energy activity and growth.

Living in a rural Alaska, I have come to appreciate the importance of available medical services and am interested to look into that option first. Has it been your experience that medical suites and business offices can work in a mixed use building? This approach could broaden our market and reduce some risk. While were on the subject of developing, I do not have any experience in that area and have too much riding on this for it to be my maiden voyage. I would need to locate a partner to put together the development. It looks like my next step is to reconnect with those that have shown an interest and go from there. I'll also need to start looking for a developer who has done medical... have you ever been to ND?

If there needs to be a choice, is it more important to find someone with development experience in this region or someone who has done medical development, although it may be someplace else.

By "verifiable experience" I'm guessing you mean a history of successful projects in this specific type of development.

Not wanting to offend someone immediately or blunder through this process carelessly, what are a couple questions I could start with when I begin to meet with developers.

How much value do I bring to the table by providing the land in a tight market?

What position does the land owner play in the development?

Do they (developer) call all the shots or do we make a plan and proceed accordingly?

What are some tip offs that someone is taking advantage of my inexperience?

Jeff

Brandon Turner & Karen Margrave, just a quick update. Spoke with the title company and documents are complete and off to the seller for review. (currently out of state). Because ND still uses abstracts, and this property was divided from a larger section, updating the abstract turned into quite a project. Finally complete and, I trust, we are headed to closing.
I have been approached locally on several occasions concerning my plans for the property. Interested parties are across the board and include medical suites, office space, retail and commercial shops. All are in short supply.
My quick and simple exit plan is to flip the property however I would prefer to buy and hold if an option exist. I'm asking for input so I don't miss an opportunity that's staring me in the face. To continue my investigation I have a few questions.
Regions are different but, in general,
1) If you would rate these options from best to worst, what would that look like?
2) What type of tenants provide the least risk and head aches and why?
3) I have not developed a commercial parcel so I may entertain the option of partnering - What would that relationship look like?
4) What are the chances of attracting a tenant for a land lease?

Jeff

Welcome John Moore - new here as well and find BP members are glad to help. Traveled through the Pocono area a time or two, lots of water and state game lands. Again, Welcome to BP.

Regards