Here is a not-so-fun fact: There’s a limited supply of land in the world. You’re probably saying to yourself, “KJ that is not true, there are buildings everywhere with land under them.” Yes, technically you would be correct, but I’m referring to raw, undisturbed, developable land. In some markets, this can be impossible to find, making it a very fruitful investment opportunity. In the Greater Baton Rouge and New Orleans markets, available commercial land is pretty scarce. It wasn’t always this way. I remember 15 years ago you could easily stumble upon land for sale. Land was ripe for the taking at cheap prices and high volume. Now, with industrial expansions, the boom of the movie and technology industries, it’s becoming more elusive AND valuable. Below I’ll share the top reasons why land is a solid investment opportunity (if you are quick enough to scoop it up).
Commercial Land is No-Effort Purchase
If you have found yourself a great Advisor specializing in land, they can find and focus on great land deals. All while you sit around and do something else. You won’t need to tour a building, or sometimes even get out of your office chair. Sure, many investors may want to physically drive or fly over the commercial land asset. Although, in order to make a smart and informed purchase you don’t have to literally touch the property. A lot of property sharks don’t even go into the same state as their commercial land investment. They trust their Advisor to find the land and also do their own research.
Commercial Land Requires No Upkeep
Besides maybe having to pay someone to cut the grass, there isn’t much an owner of commercial land has to do. The land most literally just sits there. It doesn’t move, it doesn’t go out for a drink with its buddies…it’s land and isn’t going anywhere. Unlike every other commercial investment sector, there is no structure to maintain, no buildings and suites to tour…nothing. I think you are catching the idea now…
Commercial Land Has No Monthly Overhead
Unlike other commercial investments (I am looking at you retail, office, multifamily, restaurant, industrial), there aren’t any monthly costs such as utilities, maintenance and property management to cover. You can buy a piece of land and leave it be until you are ready to sell or develop it.
Low Inventory, High Return
Like my dad always says, “they aren’t making more land”. If you’re in the market for an easy investment that produces high returns, then commercial land is going to be your best bet. A word to the wise from me to you: When buying commercial land, proper due diligence and a great Advisor will guide you through the process. Your price point will change if there are environmental issues, wetlands, or negative surroundings. The average cost of a raw land due diligence in Baton Rouge is $2,500 – $3,500. This gives you a run down of curb cuts – a phase one. Trust me, it’s worth the money. Don’t cut yourself short. It’s like not spending the $650 on an inspection for your house.
Now, go out there and find yourself some land because there isn’t much left!
About Kathryn Juneau – After breaking into Baton Rouge Commercial Real Estate in 2011, Kathryn became licensed in 2013 and began specializing in senior housing. In 2014, Kathryn became and Advisor with SVN | Graham, Langlois & Legendre, LLC. She has represented large users of medical and industrial space in an array of real estate transactions. Kathryn’s reputation of tenaciously protecting her clients’ interest, savvy negotiations and cutting edge marketing strategies have led to numerous closings and returns to her clients. To contact Kathryn, you can email her at [email protected], call her at 225-367-1515 or follow her on Twitter at @KatJuneau.