Disney wants to buy our land (FL) what would be our first steps?
Hi r/CRE!

I’m going to try to tell this as succinctly as possible.

Basically, we inherited a piece of land from a family friend right outside of Disney World in Kissimmee, FL. It’s about 10 minutes outside of the front gates to Walt Disney World. 

We recently got contacted by a representative of Disney to sell our land to them - currently it is a hotel but not a nice one, they would most definitely tear it down. 

We know absolutely nothing about how to even go about selling this land, we just know the offer we received was low ball as hell. We’re in the midst of contacting a lawyer - have asked some friends for lawyers who have a speciality in these kinds of sales. 

What is the proper first step to take in potentially selling land to a big company like Disney? How much could this property be worth? (Is there an easy way to start understanding the value of the land we’re sitting on? 

Thank you in advance for any advice you can share - we are just big ???? At this moment
[{"id": "fykp2ob", "text": "Try to find a broker that has done this before (sold to Disney), and not some rando on reddit.\n\nHave you looked at comps? How low ball is the offer?", "replies": [{"id": "fykpnl9", "text": "Oh absolutely - I have a few lawyer friends who are looking for a good recommendation for us for a lawyer to work with. \n\nHow do I go about looking up comps? Sorry complete newbie", "replies": [{"id": "fykszep", "text": "This is tough because the situation is fairly unique.  Disney is likely looking at this as a land acquisition which explains the low offer.  That is not to say that it isn\u2019t worth significantly more, but that Disney might have been notified of a title change and made a offer on a more perfunctory basis versus actually having plans to expand.  \n\nYou said there is a hotel currently on the site.  Is it open and income producing?\n\nI would say, find an experienced real estate attorney first and have them recommend a broker.", "replies": [{"id": "fykwaew", "text": "&gt; I would say, find an experienced real estate attorney first and have them recommend a broker.\n\nAlthough I said below you need a broker, not a lawyer, this is a good way to get in touch with a broker. I would also recommend to get more than one recommendation and meet with both brokerages to see which would be the best fit.", "replies": [], "depth": 4}], "depth": 3}, {"id": "fykv1la", "text": "You need a broker. Not a lawyer, a broker can provide comps, assist you with hiring an appraiser if that's what you want to do, or give you their own opinion of market value. Disney may be the ultimate buyer but your best option may be to market the property. Disney could also just be trying to take advantage of Covid and target nearby hotel owners, with no intention of paying a market price. With a lawyer you pay by the hour, with a broker you're only paying if it sells. You will need a lawyer eventually if it gets to the offering stage.", "replies": [{"id": "fykwkyb", "text": "OP - this is the correct answer. A broker will provide a FREE broker opinion of value (BOV), which includes comparable sales as ONE of the valuation methodologies.  Shoot me a DM if interested and I can get you in touch with at least one of the two brokers at two separate firms you\u2019ll need to reach out to. You can use these two BOVs and determine a fair market value without running a full process, or actually paying a broker.  Use these as leverage when negotiating price via the lawyers.", "replies": [], "depth": 4}, {"id": "fylre8r", "text": "When dealing with Disney a broker alone is not good advice. A commercial real estate attorney that brokers institutional negotiations is the best option.", "replies": [{"id": "fymnk5h", "text": "The correct answer is both.  Your broker will make sure you don't get fucked in dollars; your lawyer will ensure you don't get fucked in words.", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}, {"id": "fymjrmi", "text": "getting comps can be as easy as googling all the commercial appraisers and calling them all requesting comps...some may not be as eager to help but some will", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fykppwp", "text": "Check out what the county says it's worth.  Go to the property appraiser website for the county.  It will be worth more than what they state, but you will get a better idea.", "replies": [{"id": "fyldq5b", "text": "Terrible idea. You\u2019ll give the property away doing that.", "replies": [{"id": "fylv0wr", "text": "Not always, but in Florida the county property appraiser is always below market value.", "replies": [{"id": "fypd985", "text": "That\u2019s my point. I have stuff in Florida.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fykpvcm", "text": "Also, hire an appraiser. The appraiser will be able to tell you the current market value. You may also be able to hire them on a consulting basis.", "replies": [{"id": "fyl4gbp", "text": "More importantly, they can tell you what the value would be for Disney's most likely purpose.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fykqh4t", "text": "Hire a certified general appraiser to give you a market value as redeveloped.", "replies": [], "depth": 1}, {"id": "fyktb5d", "text": "If the buyer approached you directly you don't necessarily need a broker. I think getting an appraisal and hiring a lawyer with corporate real estate experience may be a better use of your funds. \n\nAlso, the deal isnt going to be structured like buying a house where the only way the buyer can back out is if they dont get financing. There will be a due dilligence period where there will do surveying and environmental testing and usually can back out of the deal for any reason and get their deposit back within that period. The goal is to make the deposit as big as possible, the due dilligence period as short as possible (90 days is standard) and make sure you get to keep the deposit if they back out after then. After due dilligence they may still be able to terminate if they dont get approvals, thats for your attorneys to work out.\n\nLast piece of advice, it's common for a company of Disney's size to make offers to the general public through a shell company and try not to let you know it was Disney making the offer, because then you'd know they can afford to pay 10X the market price if they really want it. Just be weary that it's not some kind of scam.", "replies": [{"id": "fyktvqm", "text": "Yea I'm kinda surprised that he didn't get a an offer from a shell company tbh", "replies": [{"id": "fythexj", "text": "Its probably just a random commercial realtor trying to get a listing. We've all heard the pitch \"I'm with (Insert big local brand here), and they're looking to buy your location at X\" I'd say 80% of a commercial brokers job is lying", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "fyku2u1", "text": "I'm just trying to figure out how I can get some family friends who give away free and valuable land. Why am I so unlucky", "replies": [], "depth": 1}, {"id": "fyl013f", "text": "A commercial real estate appraiser (especially one with an MAI designation) would be able to help you determine the market value of your property, which you could then use to negotiate with Disney for the acquisition.", "replies": [], "depth": 1}, {"id": "fyl2pve", "text": "It's been said but get a broker, preferably one who has sold to Disney before. A good RE lawyer too, but imo a broker first and foremost. Have them do a broker opinion of value. Can't hurt to get your own appraisal too. Good luck!", "replies": [], "depth": 1}, {"id": "fyl366x", "text": "Definitely need a broker.  Couple other ideas to think about:\n1.  Your tax situation.  As a public company Disney can offer you a unit deal (exchange property for stock) that can help you manage your tax liability (spread it over time and benefit more from deductions than a lump sum liability).\n2.  Depending on what they want to do with the land you might want to explore taking an equity position in their project.   Will depend on their plans and how critical your land is, but equity participation in a Disney project is compelling.", "replies": [{"id": "fylsydc", "text": "This is a great idea. The problem is, what kind of price point Disney willing to give on their stock? If they give me some stocks at market price, why I do so?\n\nEquity position is a great idea as well. However, it depends on what kind of structure. I am willing to get a percentage of revenue, not net profit.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fyl4lwe", "text": "This sounds awesome!  You should be able to look up what other property around you has sold to Disney for as a starting point.\n\nDon\u2019t be in a rush to make a sale neither the land nor Disney is going anywhere.", "replies": [], "depth": 1}, {"id": "fyl7e41", "text": "Get a broker. Me and my team have done deals with Universal and Disney (currently selling 264 acres of land by I-Drive). DONT go at this alone and get a good team of brokers and an attorney that understands the nuisances of dealing with our local elephant.", "replies": [], "depth": 1}, {"id": "fyle4dg", "text": "They are know as the magic kingdom, so I would increase the magic resistance of your land to max your value.", "replies": [], "depth": 1}, {"id": "fylepbj", "text": "If you don't mind sending me a PM with the property location &amp; basic information about the offer from the buyer I would be more than happy to provide you with some basic land &amp; hotel comps off CoStar. \n\nI work in multifamily (apartments) finance and have no interest in benefiting from this in any way - just happy to provide you with some upfront data without putting you in a position where you feel like you might owe someone. Just let me know.", "replies": [], "depth": 1}, {"id": "fylhb55", "text": "I\u2019m an appraiser in the Orlando area, shoot me a PM if you would like discuss it and possibly get an appraisal.", "replies": [], "depth": 1}, {"id": "fyljumn", "text": "Disney isn\u2019t the only potential buyer here. Who are the neighboring parcels owned by?   Understanding what they might pay will certainly give you better leverage against Disney who already wants your property.  How badly(how much will they pay)?   Disney has money to reach a bit.  Also, as long as WDW is there, there will be demand for that land from a bunch of buyers. Find your number and stick with it.", "replies": [], "depth": 1}, {"id": "fylr25r", "text": "RE Investor in the same area here.\n\n&gt;What is the proper first step to take in potentially selling land to a  big company like Disney?\n\nYou need a Real Estate Attorney that works with Disney. Let me know if you'd like a referral.\n\n&gt;How much could this property be worth?\n\nThis depends on various criteria, but generally speaking, if it's zoned C1, $2-$500,000/acre. Again though, it depends on a number of things.\n\n&gt;(Is  there an easy way to start understanding the value of the land we\u2019re  sitting on? \n\nYes, from a land standpoint, recent sales will give you a basic valuation, but if there's an existing hotel the value would be based on the income approach (CAP Rate).\n\nThat being said, Value in these circumstances (Covid/Recession) is basically what someone is willing to pay (whether it's Disney or anyone else).", "replies": [], "depth": 1}, {"id": "fylvmxw", "text": "Pay for a proper appraisal from a licensed appraiser not a brokers opinion. Truth be told, even a shitty motel will be worth more than vacant land so you want the price with the building even if they're gonna knock it down. They know that. Disney has deep pockets and if they're asking you they've already done a fair amount of research and know what they'll pay and what they could use it for.  Tell the appraiser why you're getting it and give that to Disney if you like the number he comes up with and stick with it. They will eventually buy it because they can't move the park. YOU have the upper hand.", "replies": [], "depth": 1}, {"id": "fylwnqr", "text": "Anyone else thinking: $$$$$$$$$?", "replies": [], "depth": 1}, {"id": "fylwqcl", "text": "Call a broker with CBRE in Orlando. They have a good office there.", "replies": [], "depth": 1}, {"id": "fymi2zg", "text": "You know nothing about selling land, yet you seem to know somehow that the offer was a lowball? \n\nYou should contact a commercial broker and actually find out.", "replies": [], "depth": 1}, {"id": "fymzyxb", "text": "Tell Disney you want royalties lol", "replies": [], "depth": 1}, {"id": "fyo8l63", "text": "I'm a broker/investor here in town. Let's talk. I can assist you in the disposition of this land. I'm sure Disney is low balling you - as they always do", "replies": [], "depth": 1}, {"id": "fypda4r", "text": "Broker up bud.", "replies": [], "depth": 1}, {"id": "fyrxwb1", "text": "I would recommend taking a lower price and negotiating DIS stock options. That shit is going up!  Who knows if Disney will end up going through with the deal or what their intentions are but good luck.", "replies": [], "depth": 1}, {"id": "fytfg0a", "text": "Wow, talk about when opportunity comes knocking at your door. They're 110% going to demo the existing structure.\n\nLook at this through the eyes of the buyers. Disney definitely has the capital, but they also likley have some of the best real estate professionals in the country, with access to detailed market data and comps for your location, so they know how much its worth right now, and how much to offer you, to \"steal it\" (hence the low ball) and they also know theyre \"HAO\" \"highest allowable offer\" - a vast majority of firms no matter how much abundance of capital they have won't overpay above market value, even buying real estate AT the market value looks pretty bad (talking from experience from a mid market commercial brokerage in NYC that sees annually 50+ closed deal volume) . I find sellers sometimes think that because the buyer is a national brand name loaded with capital they think it justifys for example asking triple what its worth. because they \"can afford it\" - No, buyers aren't stupid, not going to get hosed and overpay\n\nYou don't know enough about commercial real estate to do this on your own, an experienced commercial broker will be a HUGE asset to you in this transaction\n\nYou can definitively negotiate an interesting outcome for this, you can work out an equity agreement (what I would do) , seller finance to the buyer (tax benefits to you). Really, find out what you really want out of this transaction.\n\nGiven the incomplete information you mentioned (not knowing how much total square footage,air rights, existing zoning, etc) - I can however reasonably eye ball this. You said this is a \"piece of land with a hotel though not a nice one\" to me, a \"piece\" means small, meaning anything 10,000 SQF or less or I'll consider small. So lets say your lot area square footage is 10,000 SQF. Im going to continue to shoot my shot here. If development deals (which are calculated on price per square foot basis) and if development deals in the Wynwood area of Miami (Working on a live deal right now with a contract out in this area), (Is Wynwood, Miami a reasonable comp for a neighborhood of Orlando 10 mins from the front gates of Disney World?)  - if Wynwood, Miami trades at $80 per square foot, then your 10,000 square foot lot can be reasonably estimated at 800K.\n\nAs another person on this thread  mentioned, likely C zoning due to having a hotel operating on the premise.\n\nConfirm also that it is actually Disney your talking to - is they're offer official? - talking from experience at a commercial brokerage, I can tell you that brokers will lie about ANYTHING to get a listing, that includes impersonating, being part of a larger company. It might just be a random commercial realtor in the metro saying they're \"with Disney who's in a 1031 exchange\". Did this agent ask you for a commission at any point? If not, then they probably actually are on Disneys acquisition team and you can continue in good faith (Feel like this whole paragraph is me ranting)\n\nPersonally, I would shop they're offer around to see what the local and national developers counter at\n\nFew last points, FL has one of the best real estate markets in the entire nation. Disney is likely going to hold onto the land in perpetuity\n\nGood luck!! I'll check in this in a few days to see the price and terms you guys end up closing at. Very interesting indeed!", "replies": [], "depth": 1}, {"id": "fyz4vr6", "text": "Get a lawyer.  And get an appraisal. If this is needed for a major planned project you can get a great premium on it.  Just hard to find out what the plans are for it since they keep those things under wraps.\n\nIf its just for standard land acquisition you should at least get somewhere around the appraised value.", "replies": [], "depth": 1}, {"id": "fyz5r3d", "text": "I wonder how many of the sharks in this thread called Disney\u2019s RE department now that they know Disney\u2019s requirement in the area lol", "replies": [], "depth": 1}, {"id": "fz4frpq", "text": "Call the top brokers at national firms in the REGIONAL area.  C&amp;W, JLL, NGKF, M&amp;M...these guys will tell you all you need to know like current value, prjections on value at completion and operating data, what you can build, how many units, what the climate is in the market, etc.  They will also have financing/equity quotes lined up for a potential developer.  \n\n\nAlso, you dont need an appraisal.  It's a big waste of money considering the buyer will do one anyways for financing as required by lenders.  They cannot use an appraisal that was ordered by the landlord.  \n\n\nDont go to your local place or a friend of a friend and DO NOT TAKE a referral from an attorney.  They typically just cost you a fee on the backend.  \n\nI have worked for banks, Freddie Mac MF, a debt fund, and Private equity with over $4B in transaction volume accross the country so I know what I am talking about.  And just want to give you some free advice.  I just signed up for reddit =)", "replies": [], "depth": 1}]