Real state discussion board

Anonymous
timer Asked: Oct 11th, 2018
account_balance_wallet $5

Question description

Suppose that you own a 20-acre piece of property you bought years ago as an investment property. There’s an old house in the center of it with a tenant who has a lease that does not expire for more than a year (remember, that the lease is a binding contract that cannot be broken involuntarily).

However, the lease does not give the tenant the right to use the entire property – just “a reasonable portion” in the middle of the property.

You recently found out that Amazon has plans to build a distribution center nearby; this will bring a lot of development and demand for housing to the area. A developer wants to buy the property from you so they can build a residential development of single-family homes. However, they do not want anything to do with having tenants while developing the land.

Being a "first mover" to develop residential housing is strongly to your advantage, but not necessarily the most important factor. What should you do with your "bundle of rights"?

Option 1: Subdivide the property and sell the portion without the house on it.

Option 2: Wait for the lease to expire and then sell the entire lot.

Option 3: Join with a group of investors who want to buy out the tenant (at any cost) develop the entire property.

In a minimum of 200 words, explain which option you would choose and explain why you think it is the best option. To receive a score of 100% requires a well-written reply with over of 200 words and a clear-cut, persuasive argument that includes references to the text and/or outside resources.

Tutor Answer

Tutortitus
School: Boston College

Hello buddy, attached is the complete work. Thank you

Surname 1

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Instructor
Course
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Option 2: Wait for the lease to expire and then sell the entire lot
My preferred choice is waiting for the tenant lease to expire then sell the whole land.
Vacant land is the best investment. In the waiting period, the land will be appreciating and
gaining mor...

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Review

Anonymous
Thanks for the help.

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