Does “FREE Commercial Land for Sale” Mean the Land is Worthless?

Free Commercial Land For Sale!

Free Commercial Land For Sale

Is “Free Commercial Land For Sale” actually valuable land?

I bet just reading that FREE commercial land is for sale makes you cringe a little bit. After all, if something is free, by definition, it can’t be worth much. Right?  Well, in many cases that is probably true. Whether we are looking for deals on Amazon or rummaging through someone’s garage sale on a hot summer day, we know that “free” or “cheap” means no one else wants it.

How is commercial real estate typically valued?

Commercial real estate land is valued in many different ways including several important criteria:

  • Location
  • Traffic – either vehicular or pedestrian
  • Scarcity
  • Nearby amenities
  • Population in close proximity
  • Demographics in the area
  • Income nearby
  • etc.

Basically, if you have tons of traffic looking to spend money nearby and limited available land or property, you are going to have higher property values. The better the commercial land for sale, the higher the price for that property.

One thing you can be fairly certain of is this. If you were to have a piece of commercial land available for sale in an area as described above, you certainly wouldn’t expect it to be “FREE.” In most cases, it wouldn’t be free and it would likely cost you a whole lot of money.

So, does that mean that if you see a sign for “FREE Commercial Land For Sale” you should run the other way? Should your fight or flight instincts steer you away from falling for the trap? It has to be too good to be true, doesn’t it?

Well, not so fast, FREE commercial land for sale might actually be quite valuable.

First things first, have you ever sold a property to someone else and then continued to receive additional income for years to come? I’m not talking about a sale lease back or some other type of annuity. Have you ever completely sold a property to someone else, with no leases in place of any kind, and then continued to make money from that sale for many years to come?

Unless you are what I am about to describe below, I would be willing to guess that you have never sold a property, in its entirety, and then still received income from it for many years to come.

Now, if you were to sell a commercial property for “free” and then continue to receive income from that sale indefinitely, that property could be worth quite a bit to you couldn’t it?

Who gets to sell commercial land for free and still make money?

A municipality.

That’s right, if your local village or city owns commercial land, they can sell it to you for “free” and still make a lot of money from it over time.

The reason is simple.

Tax revenue.

There are certain municipalities that are very development friendly. These villages and cities realize that if they can attract new businesses and developments to their communities, they can enhance services for residents, increase tax revenues to improve schools, and offer a higher quality of life for those who call their community home.

Are you a growing business or developer looking to expand in Dane County, Wisconsin?

Now that you know free commercial land can actually be quite valuable to a municipality, what could it be worth to you?

If you are an expanding business, or a developer looking to create a new project, free land could actually be extremely valuable to you couldn’t it? Think about your financing scenarios. In almost all projects you need to put some money down right? If you need to put 20% down and the land contribution substantially covers that amount, you could basically develop a new commercial project with no money down.

“FREE commercial land for sale” can actually be quite valuable to you.

To find this type of opportunity in Dane County, Wisconsin visit our opportunity here.

About the Author

David Haug is a Madison WI commercial real estate agent. He is passionate about helping clients, customers, and friends succeed in commercial real estate. He is also a raging Badger fan. #OnWisconsin Baby! Connect with David on LinkedIn: https://www.linkedin.com/in/davidnhaug/

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