by

Sushil Dulai Wenholz

Business is booming and you need a bigger facility. Or maybe you're ready to pull up stakes and head for a new locale. Bottom line: It's time to sell the homestead. But putting commercial horse property on the market is different from selling your average suburban house. From finding the right real estate agent to getting your barn into show shape and arming yourself with the information buyers want, you have special chores to tackle before posting that for-sale sign.

Work with a Specialist

A smart first step is to align yourself with a real estate agent who specializes in horse property. One such agent, Lee Allen of Realty Executives in San Antonio, Texas, explains, "There are thousands of [real estate agents] out there. But those who are not familiar with horse property don't know what's important to these buyers. For instance, a real horseperson will go straight to the barn-the house comes second. Most [agents] don't understand that."

Case in point: Sylvia and Bill Boon, who last year sold their coastal Oregon property and bought an equestrian operation inland. "I never thought I'd get to that point in my life where I would settle for a lesser house to get the covered arena," Sylvia recalls. "But the arena and the potential for stalls, not the house, were what mattered when we decided to purchase this place."

An agent who doesn't understand the perceived value of your facility's features-such as round pens or covered arenas-also may not emphasize these selling points to prospective buyers. Worse yet, these agents may bring the wrong type of buyer altogether-people with zero interest in your property's equestrian attributes. "And that's a waste of time and a continuing disappointment for the seller," notes Allen, who is heavily involved in the cutting horse industry. (For tips on finding a horse specialist, see sidebar, "Find an Agent.")

Price Your Property

You probably have an idea of how you'd like to price your property. But listen to your agent, too, urges Terri Wilson, an Oregon-based horse property specialist (and the Boons' real estate agent). "You're paying a good commission to have the agent sell your property quickly and at the best price," she says. "If you overprice, it will sit on the market for months."

Expect your agent to perform a competitive market analysis to help establish an appropriate price for your facility. Again, an agent who understands horse property will also know how to incorporate equestrian-friendly features and business income into the asking price. For example, says Wilson (who also promotes Lusitano and Andalusian horses), some owners think they should average a percent of the property's income-potential into the price. While it's true that income potential affects price, there is not a direct numerical relationship between the two. Instead, says Wilson, "You have to figure out how it will play out with the buildings, location, acreage, etc.-everything combined."

Similarly, you can't simply add the replacement value or initial cost of a farm building to the property's price. "[The buildings] do make a huge difference in value, but not the exact cost to replace," explains Wilson.

In other words, if you have a covered arena, your property is more valuable than a similar facility without one. But you shouldn't simply tack on the cost of building it. Likewise, you shouldn't build a covered arena just to bump up your asking price, because you won't recoup your investment.

In fact, when it comes to the amenities at your facility, "fancy" doesn't necessarily net a vastly larger price than "functional," says Allen. "A good barn can add value to the place because of its value to the buyer. But people tend to be just as accepting of a basic barn as one that's state of the art. The main thing is that it's safe." And you can expect buyers to haggle on pricing if they'll have to invest their own funds and labor to make existing structures functional. According to Sylvia Boon, her new property had potential, but was run-down. "You could see what could be done with the place," she says, "but we had a lot of work to do, so we factored that into what we paid."

The same rules apply for fencing: If it's there, in good repair and safe, your place is worth more than unfenced property. But whether the boundary is wood, polymer or mesh doesn't make much difference to the price. (Barbed wire, though, can actually reduce the price.) Other features, such as round pens and hot walkers, "are like a Jacuzzi tub in the house," says Allen.  "You don't have to have it, but it sure is nice."

To add even more appeal, emphasize things that could be on your property but aren't, says Wilson. For instance, if there's room to add a track or a covered arena, mention it in sales literature.

Understand Location and Zoning

Everyone knows that location matters when it comes to real estate, and that's particularly true with commercial horse property. "A trainer needs easy access for clientele, not a remote location," reminds Allen. The Boons, for instance, wanted to open a boarding facility, so they explored the community and talked with local equestrians to gauge the potential client base. "We found out there was a great need for more boarding facilities," says Sylvia. "We also learned that most of the barns in the area cater to hunter/jumper and dressage riders, so we went with a trail-riding clientele." Their barn is now booked solid.

With horses, location also matters because of zoning, says Wilson. Property zoned for farm use allows commercial activities that might be illegal if the place is zoned rural residential. When it comes time to sell, says Wilson, you can be blindsided if your property's zoning doesn't allow for commercial use. Get a step ahead by learning about your property's zoning before you market the facility. To get the scoop, Wilson recommends talking with county planners or visiting your county Website (you'll need the property's tax lot number, which your real estate agent can provide).

Get the Word Out

Your real estate agent will handle advertising and marketing for you. It's standard to market through the Multiple Listing System (MLS), local newspapers and, increasingly, the Internet. Many real estate agents have their own Websites; some also list properties through Internet classifieds or real estate sites such as www.4horseproperty.com. Make sure that your agent advertises your property in horse magazines, too-at least locally, but perhaps regionally and nationally as well. If your agent is involved with the local horse industry, she'll also be able to promote your property for free through the grapevine. Of course, you should never pass up an opportunity to spread the word yourself when you attend horse shows, club meetings and the like.

In general, you should plan to market your place as a commercial horse facility, not just a country home. "There's a big value in a horse facility over just country property," says Wilson. "There are always people out there looking for horse property, and you don't want to pass up that buyer.  They will pay more money for a well set-up facility and are less concerned with the house."

Of course, she adds, if the place offers more possibilities-say it could easily be converted to a llama ranch-advertise to that market, as well. Use your creativity and knowledge, she encourages, to market the property to either the highly selective audience the place is designed for (say, ropers or dressage riders) or the broader market it could appeal to.

Prepare and Present Your Property

You have your agent, your property is priced and the ads are out. Now you just have to sit back and wait for the buyers to show up, letting your agent do the work, right? Not quite. You play a big role in the presentation of your property-and presentation is vital to making the place and the price more attractive to prospective buyers.

Mostly, presentation means keeping your facility neat and tidy: It's all about curb appeal and first impressions, agree both Wilson and Allen.  They recommend taking these actions:

* If possible, remove large piles of standing manure, which can not only be smelly and unsightly, but can also attract flies.

* Get rid of clutter-buckets, old feeders, etc.-and keep feed and equipment storage areas neat.

* If you have an office and/or tack room, make sure these are neatly organized.

* Keep aisleways and breezeways swept clean; remove cobwebs.

* Clean and freshly bed stalls daily.

* Keep troughs and buckets clean; make sure the water is clean, too.

* Keep everything in good repair: no doors hanging off hinges, no protruding nails or other hazards, no holes in the roofs, no broken fencing, etc.

* Present healthy horses. Hairy and muddy (in wet weather) is OK, but sickly equine residents will create a bad impression of the entire property.

In addition to these aesthetics, says Wilson, be prepared to share some of your income (profit and loss) records. "You want to promote the idea that  this is a good location for a business," she explains. "Even if the trainer is leaving and you're selling the place empty, you want the buyers to know there's a potential for income on that property."

Finally, make it easy for your agent to show the property. Give her generous access and, says Allen, "Don't make unrealistic demands like letting me show the property just one day a week or during very limited hours."

Selling your commercial facility can be a big task, no question. But taking the time to do it right gives you a better chance of closing a deal quickly-and of netting the price you want. [sm]

Sidebar:

* Have realistic expectations with regards to pricing and location.  Don't count on finding a 20-acre farm within 20 minutes of a large city's downtown area, especially at a bargain price. Drive around the area and contact the local chamber of commerce to learn where acreage is most likely available. Talk to area real estate agents to get a feel for prices.

* Know local geology and geography. Understanding the typical terrain, climate and water supply in a specific area will help you decide if it's the right locale for you. Realize that these features can vary tremendously within just a hundred miles or so. Again, drive around and talk with the local chamber of commerce for information.

* Know the zoning. As mentioned in the article, you need to make sure that the property is zoned for the activities your business will include.

* Check the property condition. Seems like a no-brainer, but look beyond the surface and check on factors such as drainage, electricity, water supply and arena footing.

* Talk to the neighbors. Make sure you want to live near these people-and don't take the presence of horses as a guarantee you'll get along. One agent relates a story about horse-owning neighbors who enjoyed shooting their guns at all hours and celebrated the Fourth of July with dynamite. Also, ask if any privileges they've given the seller (like riding across their property) will extend to you.

* Work with a buyer's agent. These real estate agents represent the buyer's needs. They can help you with a lot of groundwork-including checking on zoning and making sure you don't pay too much for a property or bid too low and lose the place of your dreams. -SDW

Sidebar:

Agents: There is no comprehensive directory of real estate agents specializing in horse property. However, these pros aren't hard to find.  Try these avenues:

* Read ads in national, regional and local horse publications.

* Your local Sunday paper; look for real estate agents with frequent listings in the Horse Properties section.

* The Internet. Use a search engine and/or horse industry "link sites" such as www.haynet.net to find agents' sites, sites featuring horse property for-sale or the classified sections of online magazines.

* Ask local farm, ranch and equestrian organizations for their directory of members and related services, which often lists agents.

* Word of mouth. Nothing beats a first-hand recommendation from someone you trust.