Valuing Commercial Land - Posted by Jennifer(NH)

Posted by Irwin on December 28, 1998 at 07:43:12:

Commercial lease/optioning has very little in common with SFR l/o deals. I suggest contacting one of the larger commercial brokers in the area for advice. Commercial brokers are usually on top of everything that happens in their area. They can tell you what other similar properties have been sold or leased for and how your piece compares-favorably or unfavorably.
As for lease terms, they can also tell you a range of rates of return that can be expected. In other words, get an informal appraisal which will take the guess work out of it. You will have to negotiate a fee for this service since the broker is not securing the purchaser/tenant.
Then, get an experienced attorney to review any proposals and/or l/o documents before signing anything.

Valuing Commercial Land - Posted by Jennifer(NH)

Posted by Jennifer(NH) on December 27, 1998 at 07:17:06:

A relative of mind owns a piece of commercial land with a building. He was approached by a major auto dealer ship about leasing the land with an option. He is wondering what is the best way to put a value on the land and determine an appropriate annual/monthly lease payment for them. It has been very difficult to find comps on the property and what rates people are leasing their land at.

Any ideas? Is lease/optioning commercial land pretty much the same as single family house lease/options except with larger numbers or are their pitfalls to watch out for?