What to do with 4 wooded acres at an interstate exit?
My family has owned about 4 acres of wooded land on the corner of Interstate 85 and Highway 321 in North Carolina for the past 50 or so years. Any ideas what we could do with this land? Ideally we would love to rent it to someone who wanted to build a hotel or something like that. Not sure if that's common or if hotel chains prefer to own the land. I've heard that storage units are good investments, but I'm not sure how much interest there would be from the family in shelling out a million dollars to build something. Any ideas? Anybody with similar situations?
[{"id": "hptpbyp", "text": "Boat and RV storage", "replies": [], "depth": 1}, {"id": "hptrctg", "text": "If you aren't familiar I would reach out to a NNN credit tenant Commercial broker. Tell them you are looking to lease the land to a credit tenant over a long term. They should be able to secure you a tenant who will lease the land and build to suit assuming its in a desirable location. Your best bet is to take a lower rent with a long term lease and have the tenant front the costs to build unless you are familiar with development.  They could put anything from a restaurant, hotel, Walgreens etc. I would just be careful of anything that has environmental risks such as a gas station. You don't need to completely stay away just make sure you are protected from potential environmental issues created by them.", "replies": [{"id": "hptuexb", "text": "Excellent response. Well said.", "replies": [{"id": "hpu22z0", "text": "&gt;NNN credit tenant Commercial broker\n\nNever heard of it, but I will look into it. Would love to maintain ownership of the land and have decent rental income for the long term. Thanks for the advice!", "replies": [{"id": "hpucudq", "text": "Would finding a NNN broker be similar to the average residential real estate broker in that they would all be members of the NNN equivalent of the MLS?", "replies": [{"id": "hpug6oe", "text": "So NNN is a type of lease so you are basically looking for a Commercial Real Estate broker that specializes in NNN leases. Do not use a residential agent and even a commercial agent that is not familiar with NNN lease negotiations is probably not good. Your best bet is to try to stick with a large player as they will have relationships with credit tenants.", "replies": [], "depth": 5}], "depth": 4}, {"id": "hpuud9v", "text": "OP, NNN is shorthand for \u201ctriple net.\u201d All this means is that the rent you receive is net of taxes, insurance and property maintenance. Under these type ground leases the tenant pays all of the expenses related to the property including property taxes, maintenance of the building and insurance. So the payment you receive every month is yours to keep without having to pay any of those expenses. This is an oversimplified explanation of the arrangement, but covers the concept.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hptsod6", "text": "Wawa and restaurants", "replies": [{"id": "hpujo36", "text": "Wawa isn\u2019t in North Carolina. Come on, man.", "replies": [{"id": "hpuodd7", "text": "They weren't anywhere until they were lol", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hptu9is", "text": "Sounds like the perfect location for a Cracker Barrel or brand chain restaurant like Olive Garden, Outback or Chick Filet. You continue to own the land and enter into a ground lease. They build to suit and if and when they don\u2019t renew the lease, you become owner of the building and improvements. \n\nGood luck to you! You\u2019re sitting on a gold mine. Whatever you decide, don\u2019t sell the land!", "replies": [], "depth": 1}, {"id": "hpu4a28", "text": "I don\u2019t know the location well enough to comment on the retail/restaurant demand, but easy on/off of highway screams warehouse/logistics center.  4 acres is a good size for that as well.", "replies": [{"id": "hpu5ojn", "text": "4ac of land is enough to support like a 75K warehouse. That\u2019s too small for new construction", "replies": [{"id": "hq3g2jr", "text": "Depends on the location.  If it the intersection of 2 major highways it\u2019s likely to pencil pretty well.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hpu7ufc", "text": "What\u2019s the zoning?", "replies": [{"id": "hpucciq", "text": "Definitely zoned for commercial use.", "replies": [{"id": "hpui186", "text": "I\u2019m a commercial land broker. \n\nI would review all the allowable uses under the specific zoning code. There\u2019s different types of commercial zoning - industrial (light or heavy), office, agriculture, multifamily, hospitality, etc\u2026 you can find this information on the city planning website under \u201cZoning Map\u201d &amp; \u201cAllowable Uses\u201d or \u201cDevelopmental Standards\u201d. Ultimately, you will want to target a \u201cby-right\u201d use at the site so you don\u2019t have to process any zoning changes and apply for conditional use permits. \n\nAlso, you\u2019re going to want to get your hands on a preliminary title report &amp; a \u201cplotted easements\u201d map. A title company like Chicago Title can help you create the map. Make sure there are no major easements or dedicated open spaces that will diminish your net usable acreage. If you don\u2019t have a biological study, that will likely need to be conducted as well to make sure there is no sensitive habitat at the site.  \n\nSomething like RV &amp; Boat Storage is a good business concept. Minimal start up and operating costs, low maintenance. The land will need to be flat though, other wise you\u2019ll need grading which means high costs and permits. \n\nSelf storage is a great concept as well, but cities are getting stingy with issuing permits for storage because they have been popping up everywhere for the past 5-10 years and they don\u2019t create many jobs. If the zoning allows self storage \u201cby-right\u201d, then they can\u2019t do anything to stop you. \n\nIf the land is zoned industrial, you could do a Joint Venture (JV) with an industrial developer and on 4 acres likely build 50,000 - 70,000 square foot industrial building. Add a tremendous amount of value and be owner of the land and building. In this scenario, you would likely only putting in your land as the contribution to the partnership, so all the development costs would be on the developer. You would 10x the value of the land and rent the industrial out to a tenant for passive income mailbox money. Of course, you would now have a partner. You\u2019d want a solid Operating Agreement between you and the developer that outlines everything - who\u2019s responsible for maintenance, when partners are paid (quarterly or monthly), under what circumstances do you sell the building? A real estate attorney would be necessary to draft &amp; negotiate this document.\n\nI work for Lee &amp; Associates. I\u2019m happy to introduce you to our North Carolina office and a quality land broker in your area if you hit any roadblocks.", "replies": [{"id": "hpus1zq", "text": "And on second thought, the best thing you could do is reach out to a local credible Civil Engineer and ask them to conduct a \u201cFeasibility Study\u201d at the site to determine the \u201cHighest and Best Use\u201d. That will answer all your questions and give you your direction.", "replies": [], "depth": 4}], "depth": 3}, {"id": "hpvdb0l", "text": "Seems like there are 4 hotels on the intersection of these highways. Also seems like there is some updates to that intersection pending. This may be valuable to a QSR user because of access going on and off the highways.\n\nAs the other user indicated, may be best to inquire about 'highest and best use'.\n\nMay also be a good idea to find occupancy of the hotels surrounding. If they're booked constantly, the area may be conducive for hotel. \n\nRegardless, I would personally land lease the site. Keep the land, get a check, retain any updates the user builds on your land. \n\nI also work for Lee and Associates, and have performed a number of land BTS transactions, and have been involved in these investments myself. \n\nBy what you've described, a great option for you would be to land lease the site. \n\nI hate marketing sites but it may be wise to hire a broker to market the site. It will provide the most exposure, and fish the best offer for your land. Do NOT seek a small, local real estate firm to market. IMO a large, retail focused firm would be a great place to start a discussion.\n\nHappy to provide more insight, feel free to DM.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hpu87eg", "text": "Mini storage.", "replies": [], "depth": 1}, {"id": "hpu8e5e", "text": "I say Drive In Movie Theatre &amp; Laundromat. Cant go wrong with screens right off the highway, decent advertising!   \n\n\nBut really, don't take my advice though. I'm new to this.", "replies": [], "depth": 1}, {"id": "hpucn7d", "text": "In that area of NC, you'd need to start with whether that's really a 'stopping point' for gas stations, hotels, etc. Is that between Hickory, Morganton, Lenoir? Those three towns are so close I'd want to research if people aren't just going  to go 10 more minutes to existing options. I haven't been there in some time, the intersection may be higher or lower in the state than im thinking.\n\nBut its possible, need to check the zoning, etc.\n\nAs others have said, talk to an NNN broker.", "replies": [], "depth": 1}, {"id": "hpucyo5", "text": "Strip club!", "replies": [{"id": "hpud5pf", "text": "Ha!  Pretty conservative extended family. I'm pretty sure they would disown me!", "replies": [], "depth": 2}], "depth": 1}, {"id": "hpueqxr", "text": "Self storage. Or land lease for a large chain retail/hospitality property.", "replies": [], "depth": 1}, {"id": "hpugsjx", "text": "Wow, I just love it when Reddit brings stuff close to home for me. \n\nI\u2019ve personally shown 40 acres at the end of that street with frontage on 85 for industrial development on the past. \n\nTo be honest, that intersection is really tricky. It\u2019s a commercial area, but it doesn\u2019t have much visibility, and it\u2019s not a good retail or office area. There are hotels on that street, which makes me think another hotel could work, or you\u2019re probably looking at some form of light industrial use due to the interstate proximity.\n\nIf you prefer to own it instead of finding another property to buy upon a sale, then I would find a developer to partner with. Be careful about it, but developers love to partner with owners to bring opportunities to market. Self storage or hotels are both realistic options here.\n\nPM me if you want to talk. I\u2019m not a broker anymore so I dont care about listing it.", "replies": [], "depth": 1}, {"id": "hpui7kn", "text": "Send me site in a DM please.", "replies": [], "depth": 1}, {"id": "hpuo6mg", "text": "Just to confirm, you are talking about Exit 17 on I-85?  I spent several years as a commercial appraiser when I started in real estate, followed by decades as a corporate real estate manager doing site selection for retailers and other users. In addition, my husband and I have developed office buildings and MF from 20 to 60 units.  I am pretty familiar with just about every type of commercial real estate.\n\nAll that being said, I don't understand the many suggestions for mini storage.  This is clearly a highway commercial site surrounded by very low density development.  Where I live, there is a mini stg every 3  miles, I have yet to see a mini stg on an interstate hwy, mini stg is always located on high traffic roads in Hub areas of dense middle to upper income residential development.  Who is going to drive 20 minutes down a highway to store their stuff?\n\nIf not already familiar with it, OP should look up the definition of highest and best use and use that to guide their research.  Yes, definitely research the zoning and comprehensive plan designations for the site. Sit down with the zoning department in the appropriate jurisdiction.  Find out all the possible uses for the site and maximum densities that could be approved - for example, how many square feet of commercial development allowed.  Also investigate State utilities available, potential for and cost of connecting to municipal water and sewer.\n\nYou also need you take into account the topography of your site, are there low areas and wetlands that would interfere with development.  \n\nNext, OP should gather data traffic counts from the I-85 interchange and any surrounding surface streets.  Next, gather demographics using drive times, NOT rings.  Maybe like 10, 15 and 20 min drive times.  Compare the traffic count and demographic data against ideal locations for various highway commercial uses like hotels.  \n\nEnd users on your property will be those that feed off highway traffic, I doubt end users will be targeting nearby residents.  I do see a couple of fast-food users on that interchange, but they aren't those who target prime real estate like McDonalds.  I don't think I can see a Cracker Barrel here either, they target bigger interchanges.  \n\nFind other interchanges in that area of your state with similar traffic counts and demographics to yours, and note the users that congregate there and the users that are most successful. I think that will tell you the end users to target.  Another trick I have from my site selection days is figuring out users that are attracted to those already at your site.  When I worked for retailers, I took note of land uses around our most successful locations and looked for other sites with those users nearby.\n\nI'm glad to talk to you if you think I'd be helpful, feel free to p.m. me.  I'm not a broker &amp; don't develop outside my immediate area in Florida so my advice would be objective, I wouldn't have a dog in your hunt.", "replies": [], "depth": 1}, {"id": "hpur2b7", "text": "A quick Google of that interchange pulls up like 3 motels, a dollar store, convenience store/gas station, and a few different drive thru chains. Any competitors without any nearby locations could be good bets to approach for land lease and build to suit.\n\nA land lease would mean that they would own the building and improvements that they construct until the lease expires when they would revert to you. A NNN commercial lease often has the landlord responsible for the roof and a couple other items that tend to have long replacement/maintenance schedules.", "replies": [], "depth": 1}, {"id": "hpuw2q9", "text": "Grow weed.", "replies": [], "depth": 1}, {"id": "hpvn7gj", "text": "RV park", "replies": [], "depth": 1}, {"id": "hpw4ic0", "text": "My Credentials: I help run the #1 Retail Net Leased team across 4 different states (we\u2019ve done more transactions than any other firm). \n\nYou need to first sit down as a family and decide what your goals are. All of the above information is irrelevant if you don\u2019t understand what your family wants to do. You can hold and do nothing, sell and cash out, sell and exchange, or hold and lease the property. \n\nWho\u2019s name is on the Deed? Is it a single parent who\u2019s spouse recently passed away? If yes, then you\u2019ve more than likely had a step up in basis meaning it makes most sense to cash out as you can forgo major Capital Gains taxes. \n\nSecond of all, unless it\u2019s first class Real Estate next to other retail, there is a good chance none of the above Tenants would be interested in going there. \n\nThirdly, you are doing yourself one of the largest disservices by not hiring a qualified broker. DO NOT work with a firm that also does residential brokerage. You need someone that Strictly specializes in land sales/leasing. \n\nLastly, the majority of hotels are not corporate backed. This means that if you are lucky enough to get a hotel land lease, the guarantee on the lease would be minimal. Your highest paying rent and most likely tenants are: Starbucks, CVS, 7-11, and Chick-Fil-A. \n\nI don\u2019t operate in your area so please feel free to reach out with any non biased questions.", "replies": [{"id": "hpw8dea", "text": "What states does your firm operate in?", "replies": [{"id": "hpx4i7d", "text": "My firm operates across the nation.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "hq5dfdd", "text": "Given what other people have told you, leasing the land seems like a viable option. If you choose to go with hotel/motel, I would be happy to put you in touch with a hotel developer on my list of contacts.\n\nFor context, I work with Locktel LLC (partnered with Tesa Assa Abloy) and we mainly distribute security solutions to hotels and motels. If you ever need help getting in touch with some of our clients, maybe I can refer you to some people. Feel free to let me know.", "replies": [], "depth": 1}]