Leasing out entire barn

[Scribbler]

@wesley11

Ok lets clarify everything here… I purchased the property and yes it has a house on the property that we will be living in. Im not trying to run the barn or anything like that. I simply want to rent out the barn and the facilities to a trainer so they can run their business out of. The place has been a training facility for the last 30 years by the previous owner. We got approached by a trainer that wants to run his business out of there and I was simply trying to see what was a fair price. They would be in charge of everything. The only thing I would need is 3 stalls for my daughters horse and maybe a horse we would want to get in the future.

One thing newbies don’t understand is that there is little profit in boarding. The feed can run $200 to $300 per month and then there is bedding and labor. $1300 for training board is very reasonable. It’s probably $700 for board and $600 for training and lessons.

How do you know the trainer you hire will be a good fit for your daughter? If it’s a younger trainer starting up how do you know they will get enough clients to make the business work? Do you want to live on a property with a high volume boarding lesson and training program in your back yard?

[joiedevie99]

Dry stall/facility rental fees vary drastically by location - and in southern Florida, by season. I’m in the suburbs of NYC, and dry stalls go between $800 and $1100 here (with all facility maintenance done by the owner). In other parts of the country - people would think those were crazy prices even for full board.

In Wellington/Loxahatchee, dry stalls are comparable to NYC area during the peak season, but lower for spring/summer/fall, and lower for year-round renters. Just a few towns over, those prices would never work.

You’ll need some very local data to land in the right place.

If you want the trainer to be responsible for upkeep (mowing, etc.) and utilities, you’ll have to lower your fee.

[Bluey]

@wesley11

Ok lets clarify everything here… I purchased the property and yes it has a house on the property that we will be living in. Im not trying to run the barn or anything like that. I simply want to rent out the barn and the facilities to a trainer so they can run their business out of. The place has been a training facility for the last 30 years by the previous owner. We got approached by a trainer that wants to run his business out of there and I was simply trying to see what was a fair price. They would be in charge of everything. The only thing I would need is 3 stalls for my daughters horse and maybe a horse we would want to get in the future.

What is that trainer offering?

A good contract specialist, there a real estate attorney, could answer your questions.
He would guide you on what you need in your contract with the trainer, so your basics, liability, obligations/responsibilities and those of the trainer, etc. are covered in writing and according to the laws where you are.

The answer to all that would determine what a fair price for that would be.
Then you can deal with the trainer over that figure, give some up front so the trainer can get established, but have a way to get more later as trainer’s business improves.
You will need to have a way out of the contract if things don’t work out for you, give one to the trainer to leave under some terms if it doesn’t work for trainer, a time frame for the contract to expire and renew or end permanently, etc.

[wesley11]

The trainer already has a training facility and clients. He is based out of Miami and wants to move his operations to Broward County. I know there are alot of legalities involved and who does what and this and that. We got an opportunity to purchase this property and and went for it and it happens to have this barn. The barn has its own bathroom, tack room, feed room, and everything needed.

[S1969]

@wesley11

Ok lets clarify everything here… I purchased the property and yes it has a house on the property that we will be living in. Im not trying to run the barn or anything like that. I simply want to rent out the barn and the facilities to a trainer so they can run their business out of. The place has been a training facility for the last 30 years by the previous owner. We got approached by a trainer that wants to run his business out of there and I was simply trying to see what was a fair price. They would be in charge of everything. The only thing I would need is 3 stalls for my daughters horse and maybe a horse we would want to get in the future.

Well, what did the previous owners charge for monthly board? That would be a good starting point.

But unless you’ve put together a list of all the expenses you will incur – taxes, insurance, facility maintenance, property maintenance, etc., you couldn’t possibly know how much it will cost you and/or a trainer to run a business. It would be unlikely (or even ridiculous) to expect the trainer would mow pastures, fix fences, upgrade footing, buy equipment, etc. And those things will all affect how much you can charge (or make). For example - no way I would lease a 20 horse property that didn’t also give access to large equipment like a tractor. Do you have equipment?

“They would be in charge of everything” - like what? Do you have a list?

I’m sorry but I still don’t think this could possibly be real. No one buys a horse training facility without knowing how much it might make (OR LOSE) annually, what it would cost to insure, etc.

[Scribbler]

@wesley11

By having a trainer come in and operate his school out of there the logic is that my daughter would be part of the school there.

How do you know the trainer will be a good fit? You need someone who runs a kids beginner lesson program in jumoers. Do you want a high volume lesson program in your back yard?

There are many other kinds of trainers. High end adult jumoers. Dressage. Western. Saddle seat. What if one of these wants to rent? 20 stalls is small for a lesson program.

And what if trainer can’t make a go of it at your price or location and goes poof? Happens alot.

[clanter]

Leasing out a barn will not pay for your expensive adventure if that’s your line of thinking.

there is a But that needs to be inserted… depreciation life of farm general use buildings is 25 years.

then there a multitude of ways to shield the income by leasing the property to a wholly owned business then let that business handle the farm … even the kid’s horses could be assets of the farm leased to the parent for the kid’s use then the horse can be deprecated

sometimes is not the money earned but what is lost that is the offset needed to shield income from another stream

[Scribbler]

I do know real estate speculators in our suburbs and exurbs will jump on acreage in the hope it will eventually be rezoned for condominiums. Sometimes they end up with horse properties and then try to maximize revenue by renting it out to whoever while they wait to subdivide. That could be the situation here, canny real estate investor who wants the land and who will turn a profit regardless but knows nothing about horses. It happens.

But it’s true that only local conditions can determine the potential rent income.

I would caution against using the price paid by overwintering snowbirds as the price paid by trainers renting the entire facility from a landowner. I don’t think any trainer in any market could make a living if the 20 stall barn cost $20,000 a month to rent.

Land prices in my metro area are comparable to the ones cited here. If you are going to charge $700 a month board you can’t really pay more than $200 per stall.

And no you can’t pay a mortgage on property here with riding stable income which is why trainers here rarely own unless they are sitting on a family farm bought 4O years ago.

[wesley11]

Ok i’m thinking 250 a stall 16 stalls that’s 4k a month rent. They are two trainers that work together. One does Hunter/Jumper training the other does therapy for kids. They are both established and have clients. I believe at that rate they would be able to survive with all the sources of income they can have with training, boarding and therapy classes, also summer camps and everything they are involved in. I don’t mind the high traffic as the barn has its own entrance and parking and the house is pretty secluded from the barn. Yes all the details would have to be ironed out as far as the ins and outs of the lease, I will find a lawyer who can draw out a contract for me. But as far as pricing that’s all I was really after. I really appreciate all the feed back. At the end of the day I didn’t buy this property for the sole purpose of making a business, I bought it for it to be our home and avoid the daily grind of driving 45 min each way 6 days a week for my daughter to practice what she loves. Its a plus that we could have some potential income to help with the monthly expenses but that was not the idea coming into it. Another reason for making this jump is also getting a heads up for the future just in case my daughter when she gets older might want to make a career out of it she would be set up.

[2DogsFarm]

Aaaaannndddd… Now the additional details appear.
*Not 1 but 2 trainers leasing
*3 stalls for DDs current Jumper “and maybe a horse we would want to get”

OP, you are kidding yourself if you think this is a good solution to your boarding problems.
Please read & reread the cautionary advice already posted here.
You really need to address these concerns, especially”‹”‹”‹”‹”‹”‹ regarding maintenance of your property, who will do that work & the equipment you need along with the cost of the liability insurance you’d better have with onsite trainers teaching H/J & theraputic riders.

Bathroom, tackroom, feed room are the very least of the must-haves you will need to make this operation anything close to successful.

Anyone else need a beverage?

[Fellbutbackup]

@wesley11

Ok i’m thinking 250 a stall 16 stalls that’s 4k a month rent. They are two trainers that work together. One does Hunter/Jumper training the other does therapy for kids. They are both established and have clients. I believe at that rate they would be able to survive with all the sources of income they can have with training, boarding and therapy classes, also summer camps and everything they are involved in. I don’t mind the high traffic as the barn has its own entrance and parking and the house is pretty secluded from the barn. Yes all the details would have to be ironed out as far as the ins and outs of the lease, I will find a lawyer who can draw out a contract for me. But as far as pricing that’s all I was really after. I really appreciate all the feed back. At the end of the day I didn’t buy this property for the sole purpose of making a business, I bought it for it to be our home and avoid the daily grind of driving 45 min each way 6 days a week for my daughter to practice what she loves. Its a plus that we could have some potential income to help with the monthly expenses but that was not the idea coming into it. Another reason for making this jump is also getting a heads up for the future just in case my daughter when she gets older might want to make a career out of it she would be set up.

Lucky daughter!

[js]

If you are going to lease part to a therapeutic riding program your facility will need to be handicap compliant, need to read up on what is required. With two trainers, one doing jumping and the other therapeutic riding how will they divide up arena use? The therapeutic riding will likely want the arena clear of jumps and no Other horses working while they have clients.

Can you afford your mortgage without leaving the barn? If yes for go the leasing and enjoy your property.

[wesley11]

They are business partners and work together now, so when it comes down to time in arenas and all that other stuff I’m sure they have that figured out as they do it now…

[carman_liz]

@2DogsFarm

Aaaaannndddd… Now the additional details appear.
*Not 1 but 2 trainers leasing
*3 stalls for DDs current Jumper “and maybe a horse we would want to get”

OP, you are kidding yourself if you think this is a good solution to your boarding problems.
Please read & reread the cautionary advice already posted here.
You really need to address these concerns, especially”‹”‹”‹”‹”‹”‹ regarding maintenance of your property, who will do that work & the equipment you need along with the cost of the liability insurance you’d better have with onsite trainers teaching H/J & theraputic riders.

Bathroom, tackroom, feed room are the very least of the must-haves you will need to make this operation anything close to successful.

Anyone else need a beverage?

Tacos half done, bottle of wine cooler opened, and I am bringing the alcohol and the phone to keep up with while I mow here in a minute!

[Guilherme]

@wesley11

Ok lets clarify everything here… I purchased the property and yes it has a house on the property that we will be living in. Im not trying to run the barn or anything like that. I simply want to rent out the barn and the facilities to a trainer so they can run their business out of. The place has been a training facility for the last 30 years by the previous owner. We got approached by a trainer that wants to run his business out of there and I was simply trying to see what was a fair price. They would be in charge of everything. The only thing I would need is 3 stalls for my daughters horse and maybe a horse we would want to get in the future.

This is more, relevant information. It does not, however, change my advice. You NEED to either do a market survey or consider what you are NOW paying to be a rational benchmark and then match it. I do this right now on my 177 acres with two tenants (one with cattle, the other with the equine facilities). The only ag production I have is hay. I reserve one stall in a 16 stall barn. I maintain commercial insurance. And do many other “dances” to satisfy the Alphabet Soup in a generally “business friendly” state. These all mean things with I do my taxes.

You, in reality, are just another landlord renting a commercial space. If you want to have it considered a “business” so that you get some very substantial tax benefits then you will have act like it’s a business and do the things business’ do. That means market surveys to figure out what to charge, as well as proper insurance, meeting any local commercial requirements, etc. Fail to do this and the Tax Man will visit eventually and he will NOT be your friend when he gets there.

But, a question: have you ever run a business before? If so then you know what to do. If not then you might want to get some professional help (lawyer, accountant, County Extension Agent, etc.).

Best of luck as you go forward.

G.

[mjhco]

Go to Facebook Florida Winter Season Stabling Prices on dry stalls will make your heart stop

[2DogsFarm]

@carman_liz

Tacos half done, bottle of wine cooler opened, and I am bringing the alcohol and the phone to keep up with while I mow here in a minute!

😱 Drinking & driving?
You are setting a BAD example for OP :no:
And think of the children! :disillusionment:

[Scribbler]

@mjhco

Go to Facebook Florida Winter Season Stabling Prices on dry stalls will make your heart stop

Yes, but in this case the snowbird is renting from a trainer who is renting from property owner. This is not the price that trainers are paying to rent the whole property.

[CHT]

@wesley11

By having a trainer come in and operate his school out of there the logic is that my daughter would be part of the school there.

I can’t help with pricing, but I would make sure you have some sort of plan/out if you/your daughter do not like this new trainer. I cannot imagine riding on my own property around a trainer that used (what I perceived to be) abusive practices or deceitful practices.

I would think though, that pricing will also depend on how much maintenance the trainer will be doing. Will they keep the fencing, driveway and such in good repair, or will you? Also, will you be using their staff to care for your own horses? WIll you be pooling hay/bedding purchases?

[S1969]

@wesley11

They are business partners and work together now, so when it comes down to time in arenas and all that other stuff I’m sure they have that figured out as they do it now…

Why are they looking for a new barn? Have you checked their references?

My neighbors leased their barn to a thoroughbred rescue organization. The trainer was months behind on rent, no hay on the property, owners started buying hay because they were worried animal control would be called. Came home one day to find the horses gone, no board money, and stalls 3 feet deep in old hay and manure.

Fun times.

It all sounds great, until it is not. If you have not managed an equine business before, and it sounds like you have not - you have a lot of homework to do before you should even think about offering a lease to anyone, or allowing any boarded horses on your property. Your first step should be a consult with an insurance agent and a lawyer.