I'm 25k out of pocket for permits and clearing.I bet the pre-permitted 10 contiguous lots on the river would appraise for at least 150k.Am i being overly optimistic?

No one should ever ask someone for up front fees except appraisal fees paid directly to the appraiser...not the lender.

I am a Broker in Madison, WI as well as an appraiser and self manage some rentals. 

This is often easier in lower tier markets where the appraisals are not indicative of how the property would sell in an arms length transaction.The other risk you run is over extension.

My daughter interned in collage for an appraisal company that specialized in government takings and she did the valuations on the property fronting the Napa River. 

These numbers look good if you can get it to appraise for 170K that is the numbers I ran it at...

But you'll also have a bank attorney fee, your attorney's fee, a commitment fee (sometimes equivalent to anywhere between .25% to 1%, appraisal fee, environmental fee. 

We aren't talking about appraisals and permitting here. 

@Francisco Ruiz ensure that if you are obtaining financing, you ask/ensure with your lender that they do not have any issues with the fact that the property you are acquiring may appraise as "rural."

Not sure when you purchased the property, but keep in mind conventional loans require 12 months of seasoning before you can use the appraised value for a cash out refi.