It's all about the residuals that suck the franchisee dry.

I'm also looking for land to set up a food truck park with the sale goal- passive, residual income. 

The residual value of the property is not going to be more than any other single family in similar condition in 11 yrs, if the tenant does not renew.From there, I would look at that estimated value, less any costs it will take to make it a "normal" SF home, assuming the medical treatment center has done some custom work to the house, factor in my cash flow that I can get for the next 11 years, and back into a value for the property.Another thing I would consider: the deal is NNN during their lease term, but assuming they leave, what are your estimated capex bills?  

The floor always remains shiny and there is never any residual stain or smell after pee or poop.

Annexation, zoning, density, preliminary, and final plat approvals are examples of the steps associated with increasing site value.How much value is created is determined by deducting the "as-is" value from the entitled value.Establishing the entitled value involves determining and underwriting the Highest & Best use of the site and applying a residual analysis.A residual Land Value Analysis is conducted by establishing the built-out value of the project and deducting everything from the total value BUT land.The generic formula Total Sales or Capitalized Value - a Target Project Proft - commissions & closing costs = Residual Project Budget - Site Cost - Hard Cost - Soft Cost - Finance Interest points and fees = RESIDUAL LAND VALUE Residual Land Value is the price that can be paid to acquire the property that is supported by the Project planned to be built on it.One of the most important factors in doing this analysis is an Income-Driven approach.

His broker is really well known for the area makes millions per year in residual commission. 

When your broker is trying to convince you that no one wants to sell real estate for the rest of their lives and that recruiting people is the way to go and to live off the residual income (which some extremely well-connected people are making six figures by doing nothing) then yes, I think it is something that might be trendy now but I don't see it lasting for a long time for most agents. 

Doing so would trigger the need to pay Taxes on gains, additional closing/agent costs to sell our properties, and provide no residual income or capture of any benefits related to holding a property in a high growth area.

The solutions would be in the form of building out the passive or residual income presentation and also giving them a portion of the profits when the development is done. 

Making residual income How did you find this deal and how did you negotiate it?