ᐅ Sell the entire property or opt for a partial sale with reinvestment?
Created on: 10 Jun 2018 13:41
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kaho674
There is a large property in the family located in the center of Dresden. It is a residential area—surrounded by 6-story or even taller new apartment buildings. The land is currently occupied by a very old factory building. The owners do not have the funds to demolish this building and replace it with modern new construction. On the other hand, the ongoing costs and rental income are just about breaking even. If income continues to decline, the property could financially ruin the family.
So the question is what should happen with this "factory land." It is quite certain that it could be completely redeveloped since there are multi-family buildings all around. Adjacent to this land is the family’s own business property (including land), which is not intended to be sold as it is their livelihood.
The immediate idea was, of course, to sell the entire factory land. Its value is estimated at around 1-2 million (minus demolition costs), without going into details here. The money could be taken, divided among the family, and essentially spent without long-term benefit.
However, there are also grandchildren who are struggling to establish themselves in Dresden. The family would like to support them over the long term and believes that a rental property would be ideal. Coincidentally, the grandchildren are trained in property management and could help oversee the project.
So the idea came up to sell only part of the land to gain liquidity, demolish the old building, and construct a multi-family house—ideally in collaboration with an investor who would buy and develop the other half. Of course, everything would need to be carefully calculated to see if this is feasible and if the land will generate enough value.
Is something like this possible, or is it just a scam? What would you do?
So the question is what should happen with this "factory land." It is quite certain that it could be completely redeveloped since there are multi-family buildings all around. Adjacent to this land is the family’s own business property (including land), which is not intended to be sold as it is their livelihood.
The immediate idea was, of course, to sell the entire factory land. Its value is estimated at around 1-2 million (minus demolition costs), without going into details here. The money could be taken, divided among the family, and essentially spent without long-term benefit.
However, there are also grandchildren who are struggling to establish themselves in Dresden. The family would like to support them over the long term and believes that a rental property would be ideal. Coincidentally, the grandchildren are trained in property management and could help oversee the project.
So the idea came up to sell only part of the land to gain liquidity, demolish the old building, and construct a multi-family house—ideally in collaboration with an investor who would buy and develop the other half. Of course, everything would need to be carefully calculated to see if this is feasible and if the land will generate enough value.
Is something like this possible, or is it just a scam? What would you do?
kaho674 schrieb:
We would like to have a solution that provides the heirs with a regular income later on. But so far, we don't have any ideas.Education?
Alex85 schrieb:
Education? That alone is not enough to make a living. Both have university degrees.
11ant schrieb:
Here you meet homeowners of single-family houses (possibly with a separate apartment). In other words, people for whom a twelve-family building sounds huge. For a land developer, "a piece of a twelve-family building" is more like small change. So it’s good when there’s potential for several of them. That’s the problem. With the land and our finances, we’re always stuck somewhere in between. It’s not enough to really get started, but it’s too valuable to just let it sit idle.
kaho674 schrieb:
You can’t live off that alone. Both have studied.Then the answer is the same. If you become a triangle blacksmith but don’t sell any triangles, you’ll have to reconsider your approach, right? Or go where triangles are needed if you don’t want to give up your passion.
Support could be, for example, learning a trade for three years, receiving a monthly allowance X during this period, and getting a bonus for a good or timely completion.
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HilfeHilfe11 Jun 2018 18:10kaho674 schrieb:
There’s no emergency right now. Work is available, just not the dream job. The question is whether to form a triangle orchestra... Don’t push the grandchildren into trouble. Everyone started small and not immediately with a $1.25 million project. Sell and arrange internships for both grandchildren. Sorry to be so blunt. I see many young graduates at the bank who can make big speeches and create colorful presentations. But when it comes to a practical approach, it quickly falls apart. They tend to try to persuade the older generation. Who are your grandchildren going to persuade? The site managers? Architects? The grandchildren don’t even have a network. They will get taken advantage of. And they don’t bring liquidity either.