When looking at larger ranches — say , 1,000 acres or larger — a key component in any deal is a portion of the mineral rights to be conveyed to the new owner , because they are going to want as much control over their land as possible . It ’ s also a potentially major source of revenue . When it comes to negotiating these aspects of a deal , you need a savvy commercial real estate broker and attorney who understands the complexity . Many families who sell large tracts of ranch or farmland will be reluctant to part with the mineral rights , but in those cases , I try to negotiate a portion of them . If we can buy 50 percent , for example , that keeps both parties involved . But a lot of times , when dealing with these big ranches , if the price tag gets large enough with full rights to the land , deals can get done .
Land is a limited resource , but there are opportunities when family-owned ranches pass hands and maybe the kids or grandkids aren ’ t interested in operating it . COVID-19 has led some people to reevaluate what they want to do with land .
Whether it ’ s because there ’ s no income tax or any number of factors that attract new populations , Texas will continue to be a major destination for incoming residents , just like Florida and other states in the South and Southeast .
CIRE : WHAT OTHER AREAS OF CRE LOOK PROMISING IN TEXAS ? ARE THERE ANY SURPRISING MARKETS THAT COULD BE HOT IN FIVE OR 10 YEARS FROM NOW ?
WEBB : RV parks , recreational lake properties , farm , and ranch all will continue to play a major role in the next decade . As far as factors specific to Texas , we have seen an influx of people coming from out of state to relocate into Texas . Whether it ’ s because there ’ s no income tax or any number of factors that attract new populations , Texas will continue to be a major destination for incoming residents , just like Florida and other states in the South and Southeast . Similarly , with changes to shopping habits and struggles in retail , along with growing cities and suburbs , the industrial sector will continue to expand in the coming years . Today ’ s supply chain challenges can ’ t slow such growing demand for open farm and ranch land and prospective industrial land sites .
Another thing about the Dallas-Fort Worth area , the airport is right in the middle of the metroplex , so the opportunities for industrial and warehouse extend in all directions . Even if you go an hour to the south , southeast , or southwest , there are a lot of pockets for opportunity . The growth in the entire area has been strong , so the changes to how people shop online and how things get delivered mean warehouse is a strong sector . Additionally , with people moving into the area , you ’ ll see office and retail projects tick up to deal with that growth .
Nicholas Leider Senior content editor of Commercial Investment Real Estate
Contact him at nleider @ ccim . com .
CIREMAGAZINE . COM COMMERCIAL INVESTMENT REAL ESTATE MAGAZINE 19