Purchasing Farmland in Southwest Ohio can be a Smart Investment

farmlandA famous old real estate chestnut attributed to Mark Twain urges investors to “buy land – they’re not making it anymore.” While the wisdom of the advice as a blanket statement may be open to question, its basic premise that land is in limited supply is obviously true – especially so for agricultural property. This type of acreage, while it typically costs less per acre than developed land, has historically tended to offer better-than-inflation returns, and a good way to diversify a portfolio and protect against market volatility.

Investing in farmland is emerging as a popular and lucrative avenue. It captivates both those with aspirations to develop the land for residential or commercial purposes and those seeking to lease to tenant farmers. The post-COVID commercial realty market in the vicinity of Cincinnati has witnessed a notable surge in interest. It’s primarily from residential developers and industrial distributors. The appeal extends beyond the burgeoning commerce along the Cincinnati-Dayton-Union KY corridor; it is equally attributed to the exceptional quality of the farmland in the immediate vicinity of Cincinnati.

As the allure of investing in farmland continues to grow, the potential for development or leasing to tenant farmers presents a spectrum of opportunities for investors. The strategic location of Cincinnati within the evolving commercial landscape further enhances the attractiveness of these investments. The region’s post-COVID resurgence, coupled with the intrinsic quality of the farmland, positions Cincinnati as a prime location. An area ready for those seeking to capitalize on the dynamic intersection of agriculture and commercial development.

Why Acreage in Southwest Ohio is Ideal for Commercial Real Estate Development

We were founded in Lebanon, OH, along what is now the Cincinnati-Dayton corridor, so Southwest Ohio and Northern Kentucky real estate has always been our focus. We’ve spent decades acquiring the best pieces of empty acreage and farmland available for land development – over 85 years, in fact. One of our main drives in our commitment to buying, selling and leasing the best pieces of commercial land is securing quality parcels of farmland in locations we know will be integrated into the ever-expanding Southwest Ohio/Northern Kentucky commercial real estate market.

Our region’s geology makes developing land easy compared to other parts of the country. The open, shallow rolling hills, and flats around the Ohio River, make regrading land to prep it for building foundations a fairly simple process. This also means factors such as creating access roads and running new utility lines don’t have to be expensive feats of engineering. And because we’re so familiar with the area’s existing empty agricultural plots on the market, we can give you great advice on what a commercial or industrial development project would look like from start to finish.

Investing in Farmland is a Safe Bet with Low Risks & High Returns

The forces propelling the buying, selling, leasing, and construction of industrial properties, such as warehouses, are paralleled by a significant upswing in the growth of the agricultural sector. The demand for farmland is soaring, driven by industry-related influences, and it’s reaching a premium status due to its inherent limitations. Unlike every parcel of empty acreage, not all can metamorphose into a farm; the key lies in possessing plots of arable land.

The symbiotic relationship between industrial expansion and agricultural growth underscores the interconnected nature of these sectors. As industries thrive, the need for agricultural resources and land becomes increasingly pronounced. The scarcity of arable land amplifies its value. It creates a competitive landscape where strategic acquisition and use of farmland play a pivotal role in meeting the demands of a burgeoning economy.

This limited availability of usable acreage, coupled with the ever-increasing need for larger crop harvests, make purchasing some or all of a farm a smart long-term investment. Farmland investments consistently outdo other commercial real estate returns – 12% compared to 8%. And when you consider market fluctuations, farmland is more than one standard deviation less than other types of CRE properties.

When you buy farmland and lease to a tenant farmer, you create 3 avenues of revenue from that investment: capital appreciation (7% in 2021), rent payments, and crop yields (investors usually receive a percentage). Agricultural operations are protected from inflation and economic volatility, and as far as lucrative CRE investments go, they’re very low-maintenance.

Holding Farmland Instead of Selling Is an Effective Hedge for Inflation

Investing in farmland can serve as an effective inflation hedge. We mentioned it before as being low maintenance but they’re an incredibly safe investment if you’re expecting economic turmoil. As far as real estate sales are concerned, farmland is extremely responsive to changing economic conditions. As inflation rises, the value of agricultural products typically increases. This is driven by the basic principles of supply and demand. Food businesses and their production are never driven down in our growing world. The demand for food and raw materials remains constant, and in times of inflation, their prices tend to surge. Farmland’s inherent connection to the production of these essential goods positions it as a tangible asset. It even has the potential to appreciate during inflationary periods.

Farmland’s limited supply and long-term demand contribute to its strong purchasing power. With farmland in an investment portfolio, investors can gain from its ability to preserve and enhance their capital’s value amid inflationary pressures. Buying farmland in Cincinnati can add a layer of protection and stability to your holdings.

We’ve Bought and Sold Farmland for the Better Part of a Century

Right from its beginnings, the Schueler Group of Companies handled farm properties; in fact, we were founded in Lebanon, Ohio in 1935 as a farm brokerage. One of the most noteworthy deals ever brokered by our founder, George Henkle, was the sale of 1,500 acres of arable land which is now the home of the Kings Island Amusement and Water Park. We understand the tax and other legal implications involved in agricultural land deals, and can help you assess the potential of a site as income property or for commercial development.

View available farm sites, which are included in our residential land listings, and speak to one of our commercial sales agents or brokers to learn more about why you should consider agricultural acreage as the site for your next venture in commercial construction.

Our Mission

WE ARE ONE TEAM TO BUILD YOUR FUTURE.
Our business is your business. We are an established, respected and comprehensive real estate company headquartered in Southwest Ohio with the experience and teams necessary to be with you every step of the way on your next real estate project. Research by industry leading experts side-by-side with top-of-the-line construction and management services, this is what we bring to every project we are involved with. The Schueler Group wants to bring your project to fruition, on budget and on time.

A Few Steps to Follow When Looking for Commercial Real Estate

When you are looking for real estate for your business, be sure to follow a few simple steps. First, make a list of everything you are looking for in your commercial real estate. Whether you are looking for warehouse space, retail space, land to build or property for other reasons, make sure you know what you need. It’s also important to decide on the general area where you want your property to be. Another important step is to find out what your employees think about real estate options. They know your business well and can offer important input. Be sure to also study the areas where you are looking at properties. See if the properties around will help your business to grow, or if they could hinder your growth.

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