Location and Timing in Land

Location, location, location isn’t the rule in land any longer. It’s location and timing, and timing might be more important.

That was the key message handed out by Bob Turner, ALC at his talk on investing in land in the future, given at the NAR Expo 2016 in the Commercial Learning Theater.

“We used to work on 10-year trends,” said Turner. “But since the 2008 crash, I’ve identified in my business that every cycle is a two-year cycle.”

This accelerated rate of change means that investing profitably requires the opposite of the traditional location-based projections and fire-and-forget investment.

Turner spoke of a big development in Memphis that follows the new rule. Its full construction schedule is pegged at six years, which to Turner means it spans three steep cycles in land prices. The answer: “We break down the development into six phases. We’ll put in roads and infrastructure, but what a parcel of the project will ultimately be developed to be is decided much later.”

To Turner, doing it this way is akin to a win-win: “If the price (of land) goes up, we do very well. If the price goes down, we do okay.”

Conference Live 2016