I planning on leasing out my facility (6 stalls, outdoor dressage arena, small covered/ lighted arena, paddocks, tackroom, wash rack). I am wondering how to structure the lease. Do folks lease by the stall? The entire facility? What is included in the lease fee (use of all farm equipment, drag, etc)? I would love to hear how folks structure their leases as well as good and bad experiences. Also, if anyone doesn’t mind sharing their fees, I’d love to hear that too!
Be sure that the lease contract specifies you be named as a co-insured for liability purpose and that you get a copy/notice every time of proper payments made to the insurance company.
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Here it is per stall and the going rate depends on the amenities. A basic place with no indoor might lease for $175/mo per stall while a top flight place will lease for $250/mo per stall. Obviously that is very regional and this may not apply to you.
that would not include equipment. The lessee would have to provide their own tractor, drag, etc.
This is a VERY complicated subject because the lease you might have for the full facility will be vastly different from what you would do with a “dry stall lease” contemplating self care.
You have to focus your thoughts and then draw a contract that will facilitate you accomplishing your goals.
G.
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I have only heard of this being done two ways: flat fee for the use of the facility, and basic flat fee plus a fee per horse. The second way makes more sense to me for both parties. I have never heard of the use of major equipment being included in the lease.
That’s interesting about the equipment. As I already have most of the equipment (tractor, arena drag, manure spreader) and don’t want to store more I would have to put their use in the lease and account for that in the cost.
My thoughts were $ X/ stall, which includes use of the arenas and two pastures. $5/ haul in ride. I would pay electric, but lessee would pay all other costs (stall cleaning labor, shavings, hay, etc). I would pay general maintenance of the facilities, but lessee would be responsible for damages caused by a boarder (which I guess she/ he could pass that cost onto the boarder if they wanted/ needed).
Would it be reasonable to set rules such as no lessons after 8pm (to keep lights from bothering neighbors)? Visitors/ boarders must vacate property by 9pm (unless of course emergency). What rules have you liked? Disliked?
Love to hear any suggestions, thoughts, etc.
Is this a per stall lease to the general public or a lease to one operator but the rent paid is based upon stalls leased?
If the former then you’re going to be like a ticket taker in a parking garage. You’ll have to be around and watchful all the time 'cause not every person is honest!!! If the latter then you still have to exercise some watchfulness to keep everyone honest. Not all tenants are honest, either! 
But you can get yourself into trouble if you start with all kinds of rules. Every rule you put into a contract (either directly or incorporated by reference) must be fairly enforced or you can lose the ability to enforce it at all. Just how aggressive you must be will be a question of local law. If you can under your law “micromanage” do you really want to? You can run yourself into a frazzle by becoming a “helicopter landlord.”
I’ve leased my barn and associated facilities for more than 15 years. I’ve done it both ways. The “self care” model went away real fast; it was just too hard to police and way too many horse owners just didn’t live up to the contract. The “whole facility” model worked best. The lessor is responsible for their business and all I want is the rent paid on time and reasonable care for the facilities. I did not micromanage things like business hours, access hours, etc. The tenant set reasonable hours and I was happy. If they didn’t then I’d have a private chat with them and we’d come to an agreement. The ultimate solution was notice to quit or notice to leave. I never got that far with any tenant.
Note that I did ask tenants to leave for good reasons and I had tenants leave for their own reasons. A lease agreement is business contract, not a marriage!!! 
Sharpen your focus by writing down what you want from a tenant. Item One is the rent, paid on time. Then list the rest.
G.
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Since you only have 6 stalls, it makes more sense for you to be looking for one person to lease the whole thing to run their business out of it (or perhaps just someone who wants their own barn for their own horses - I’ve seen this happen). Trying to lease out just a few stalls wouldn’t make sense.
It depends on where you are. Here in CT, a nice farm with an indoor will rent at around $200-300 per stall (again, a chunk of stalls, or all, depending on the size of the farm). Smaller farms with fewer amenities, the price goes down from there. Some of these includes equipment usage, electric bill, manure removal; others don’t. Keep all of that in mind. Manure removal around here is a big sticking point, and the places that don’t include it as part of the lease will usually state that it must be removed X times per month or year.
Given what you’re talking about, in terms of equipment usage, etc., it seems like renting the whole place for a flat rate would make the most sense. If it averages out to what the going rate is in your area, perfect.
Thanks everyone! Re; manure removal. Good point. Thankfully I have about an area of lighted wooded land that I spread manure around. Trees love it and the land is otherwise unusable.
I think my facilities are quite nice, not Wellington spectacular, but nice. all 12X12 matted stalls with attached run-outs, wash rack, large tack room, 50X150 covered, lighted arena with sand/ fiber footing, outdoor 20X60m dressage arena with sand/fiber footing, two nice one acre pastures for their use along with two smaller paddocks, access to trails, central location with many shows within 1-3 hour drive. My horses are housed in a separate barn (but would share the large backroom). Possibility to rent 1 bedroom cottage on the property as well. So I think I nice place. I could even build two more stalls in the barn making a total of 8 stalls.
My next question, and I’ll start another thread…what do you guys suggest as good places to advertise? I’ve posted on my GMO Facebook page and another regional Facebook page, but no responses from legit parties. Thanks for all your guys help!
I think it’s unrealistic to have a lessee own that kind of equipment. After all, leasing a barn means that you don’t have an easy way to store or move big machines like that.
Generally speaking, this is how I’d do it:
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Lease out the whole place, not by the stall. Your life and your lessee’s life will be easier if it’s just one person managing the lease and the barn. I would not allow self-care by various boarders, nor micromanage your lessee’s business. That all amounts to creating more hands-on work for you!
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Specify which parts of the farm they get access to for that price. IMO, it makes sense to set a price that includes everything they’d need in order to run it on a day-to-day basis. So, for example, the lease fee includes access to enough turn out, enough storage and places to ride.
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You do the farm maintenance, large and small. The lease fee covers that. IME, this is the part of lease deals that blows them up. Lessees don’t have the time, the equipment nor the interest in fixing the stuff that goes wrong on horse farms. There are more- and less thorough/expensive ways to do things. Since it’s your asset, you ought to be the one calling the shots about how it’s maintained. And do you really want someone else to be using your tractor and such? The more expensive the piece of equipment, the less I want someone with no skin in the game using it. If you hand that job to someone else whom you don’t employ, I think you are setting yourself up to be disappointed.
I see BOs getting butt-hurt about how there lessees don’t respect their farm enough to do the maintenance. You know what? There’s not enough time in the day, nor money in boarding for them to do that and use the boarding business as a “loss leader” in order to create the training business that butters their bread. Remember that all the work those folks did just to care for the horse was “for free” and done 7 days a week… before they taught their first lesson that just might start to put them in the black. It’s very tough with there being such small margins in boarding these days. Just embrace that truth and create a lease that pays you to maintain your asset they way you want it; don’t ask for what you know the other side can’t give you… and then get unhappy. That’s really not fair and also unsustainable in a business relationship.
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Ask for the things you’d want in an apartment lease-- a damage deposit, first and last month’s rent, proof of (liability) insurance, including a Care, Custody and Control section with you named as an Interested Party, the length of the lease and time required if the lessee wants to give notice and move out without penalty.
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Have the lessee pay for things like electricity, water, materials, labor, manure removal that they can do… without risking damage to your facility nor sharing with you. For example, if there is a separate meter for the barn they’ll use, have them put that account in their name. Or if the whole farm or parts of it that they’ll use (e.g. indoor arena with lights) is shared by you, fold that into the lease. You might want to specify that it will take you, say, 60 days to figure out just what those charges will be since you need to see what they end up using in practice.
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If you live on the place and have pet-peeves about people coming in at all hours or 7 days a week, figure that out ahead of time and let the lessee know. He/she can then decide if those will work for them or will not. Remember that this is a business and a customer service business at that. Think about how you want to handle the 24/7 nature of horse care, especially if you live on the place but don’t want to be on call or always seeing unexpected headlights in your driveway.
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You will be inconvenienced at times… for which you are being paid an amount that you negotiated. Plan to not love the leasing arrangement sometimes (but maybe, too, be happy to have another set of hands on the place if, say, you want to go away and have someone care for your horses). Just remember that having house guests and running a hotel are entirely different propositions; folks get degrees in hospitality management. Owning a farm is a necessary condition for leasing it; that’s not a sufficient condition for success at it.
I hope you can a good lessee! A small 6-stall barn shouldn’t be too bad to lease out.
It is reasonable to set hours, and check with your insurance before you do. Typically I’ve seen 9pm curfew, except for emergencies or medication - but not riding. Horse people may get up very early, so decide if you can cope with 7am or not (are you on the property?).
Agree with the others that having 1 person responsible is much much easier on the owner. Although, I am told you need a minimum of 10 stalls for a trainer to have enough business (10 stalls for the trainer) to make it worthwhile.
Your indoor is on the small side so again 1 trainer would make more sense than multiple boarders who may want to lunge and ride at the same time in the winter…
Ask your attorney about drafting a lease and specify which areas are leased and which are yours for your own horses.
I meant that the lease rate was calculated based on the number of stalls at a set price, not that they were individually leasable. In other words, a 6 stall barn with no indoor might lease for 900 a month while a 20 stall with an indoor would lease for 4000.
I see! More horses doesn’t automatically make a lease harder… but more people involved definitely does!
I do not think you can lease out the facility to one person AND make money from trailer-ins. If I was leasing a facility that would be a no-go for me, having randos from the owner show up.
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You said it was central to shows - between 1-3 hours - are they rated? I ask because that can make a major difference to a trainer with built-in clientele.
As others have suggested, just lease the barn to one person. It won’t work well piecing it out.
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Typically, the rents that landlords charge for a house fall between 0.8% and 1.1% of the home’s value… add up the cost of the improvements then at least you have an idea of what a realistic return on the investment would be
$250,000 = between $2,000 and $2,750 per month… not accounting for the use of the farm equipment which also needs to calculated as it will deprecate more rapidly with use
where’s and what is the scale of your arena?
I read that as if trainer-lessee wants to have other clients trailer in or host a clinic and have people trailer in for that, then BO gets a cut. That seems reasonable to me. If BO was also BM/trainer, then no one would care if they charged a facility use fee on top of whatever training or other charge may be involved with someone trailering in. If BO is responsible for some of the maintenance, owns the heavy equipment, then it seems reasonable that BO would get some of (if not all of) this fee. $5 seems too low to be worth bothering with, however, by the assumed size of this facility.
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But presumably that five dollars would only be a portion of the trailer in ring fee? The other part going to the person paying to lease said facility. We are left presuming lots of things haha I think as always it boils down to if you want something, ask for it. If everyone agrees, put it in the contract.
I assume the OP wants to be involved in the management. Rules, nickel and dime charges, and shared fees mean lots of accounting and hands-on activity. If that is what you want, go for it! It’s a tough way to earn income IMO.
I would not include equipment in my barn lease. Offer a separate equipment lease so that if something goes awry with equipment, it can’t be used as a reason to void the barn lease. Personally my experience is that nobody takes care of your equipment better than you do. I no longer lend equipment because I have had other break it through careless operation. If I leased, I would have a hard and fast language about equipment damage and loss.
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