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Key takeaways:
- A turkey farmer aimed to sell her property to someone who would continue to manage an outside poultry business that operated on the land.
- These types of properties need to meet farming industry standards for housing birds.
- Focus on the income potential when discussing maintenance and other costs with potential buyers.
My company, in a small Virginia town, specializes in farm and ranch properties. I was delighted to receive a referral in August to help a woman sell her 1,965-square-foot, three-bedroom home. Two poultry houses on the 48-acre property were set up for raising turkeys. The woman and her late husband—who sadly died from COVID-19 complications shortly before she listed the property with me—had managed the poultry houses for another company for 30 years.
My client hoped the company would stay on with the next owner, which would increase the property value and help spur a competitive offer. This agreement was worth six figures annually, For many locals with farming experience, purchasing this property could offer a lucrative opportunity.
Initially, the poultry company didn’t want to commit to working with a new owner. I feared that without the promise of a contract, the market value of the seller’s property would drop by hundreds of thousands of dollars. But after further discussions with my client, the company said it would be interested in remaining with the condition that the poultry houses be upgraded. While the two facilities had sheds for the turkeys built with high cement walls, a feature the tenant appreciated, the houses needed new wiring to support a modern computer system and new feeding and watering lines for the birds.
The cost of the renovations would be about $300,000. My client didn’t want to spend that kind of money, but she was concerned that the needed improvements would deter potential buyers. I suggested that she could sell her main home, which was in good condition, and hold onto the poultry houses to sell at a later time after she assessed all of her options. However, she pushed back on that idea, as she was ready to fully move on to her next chapter and focus on spending time with family, not managing poultry houses. We went ahead and listed the home and the unrenovated poultry houses, and I felt confident that with a built-in income opportunity, we could find the right buyer.
Focusing the property marketing on the quality construction of the poultry houses, the potential for a contract with the company, and the assets of the main residence—which had stunning views of nearby Shenandoah National Park—my seller and I listed for $859,900. Soon after, I learned that a buyer was interested. He and his wife had grown up on farms and were seeking an income property. Real estate turnover is low here, and this was a rare opportunity. The buyers were comfortable making the upgrades to the poultry houses, and with that assurance, the company agreed to stay.
As of early December, we were on track to close for the full asking price at the end of the month. My client can look forward to her next chapter, confident that the next owners will appreciate the property as much as she did for three decades.
—Micah Branson, GRI, Old Dominion Realty, Harrisonburg, Va.
