Considering leasing our barn - full or partial. I’d appreciate any and all suggestions with the good and the bad.Especailly those who have had that experience.
Have an iron clad contract on who is responsible for maintenance and damage from the horses.
I could write a novel on this after considering it on my property.
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Would you still live there?
A barn owner friend, former coach, is leasing her barn out to her junior coach, and it is working well, but the BO still lives on site, and it is someone she already had a working relationship with, so no real surprises.
On the flip side, a local barn was pretty much trashed by a trainer leasing from “investors” (not on sight, not horse people). The trainer has no business skills and didn’t keep up with maintenance. The owners ended up selling it and the trainer took everything she could, including the tack lockers.
A trainer with experience and good references leasing a property might be worth it though.
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I did it once.
When I was in between having horses, goats and sheep and my small barn and pasture was free I let a lady bring her horse to stay short term. A neighbor had come up the driveway with this lady begging for a place to stay for her old mare.
It was awful. Terms were that she’d feed and care for her mare, bringing all feed and bedding. She’d pay a nominal fee for the use of the place.
Within two days she wasn’t showing up to feed her horse - a very old, thin horse.
I fed the horse. No bedding arrived, no hay arrived. I found the lady tossing manure over the fence into the stream instead of placing the manure in the muck bucket and taking it to the manure pile.
I had to keep after this lady to do her part right from the start. Apparently she had done this to others in the area. Many others.
Then came her family - to ride this thin, old, lame mare.
I came down the driveway to see the mare facing the wall of the barn while the 11 year old child of this lady kicked and kicked and kicked that mare while sitting on her back.
I let out a bellow that scared the hell out of that lady, her daughter and her husband. Amazing they had to be told not to treat a horse in that fashion and they certainly weren’t going to do it at my home. That was the end and I told them they needed to find a new place. She found another place within a couple of weeks, apparently using the same sob story that got her into all the other places she was kicked out of. She took a muck bucket and several tools with her when she went so I had to get those off her and I never did get several months of barn fee.
I know everyone isn’t like this, but the next time someone came down my driveway asking to keep their horse at my place I said a definite no.
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Both of those scenarios have played out in my mind. What I’m trying to figure out is all of the parameters that would have to be set. And if the barn isn’t leased in it’s entirety, then how does that work? Pay per stall? What is fair if said trainer takes on all the daily stalls & feeding for the other horses that are still there?
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Yes, our family lives on the farm. it could be a big help, but we still have personal horses there too. How do we determine what is fair if the trainer assumes the daily care - feeding, stalls etc.
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So many things to consider. First of all, leasing a farm/barn facility is not a “passive” thing to do. It requires preparation, supervision that terms are being followed, and if necessary enforcement of terms or payment. Because the physical structure of a barn is expensive, and horses are prone to destroy things, you need to be mentally prepared for the wear and tear that might ensue.
When preparing your contract, think ahead about things like maintenance, mowing, and use of equipment. For example, I would not be comfortable with someone leasing my barn using my tractors or mowers–they would either have to bring their own (not practical for a lot of people) or I would need to provide those services. Neither would I want to risk that they would attempt a shoddy or dangerous repair after damaging something (or forgetting or dealing with routine repairs in a crappy way), so I would want to be coordinating most repairs myself (although the tenant might have to pay for it if it was damages).
Another thing to consider and address is security. Who will be allowed to come and go from the property? At what times? What will they be allowed to do there? What access to your belongings and animals will they have?
As @treebeard pointed out, what standard of care do you require for animals housed on your property? How many (and what type) are allowed? What is your plan if your tenant neglects their animals? This is a HUGE, and very real consideration. I know of numerous instances where leased properties were the site of horses being neglected and even starved or animal hoarding situations.
Because of issues like these, many facility owners choose to do a “dry stall” rate. Stalls are leased at a rate where the horse owner is responsible for all feeding and care, providing all of their hay/feed/bedding/buckets etc. but the facility owner provides a maintained facility, riding areas, mowing, etc. This type of scenario runs into some of the issues involved with self-care board including making sure horses are cared for, but protects the facility a bit more than a pure lease situation.
If you decide to lease out your facility, be sure to vet any potential tenant thoroughly, similar to leasing a house or apartment. Credit check, background check, proof of income, and calls to prior landlords and to references.
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Think of everything you do there every day, and decide who is going to do every one of those things in this lease arrangement and how much are you willing to deal with not being how you want it and get that all covered in a contract.
Are you OK if they only scrub water troughs once a year (just an example)?
Like renting out anything, be sure to get great before photos of all spaces you lease out.
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How timely!
I’m leasing half of my facility. Just started, but I’ve seen enough lease situations go bad (not at my facility) that I am structuring the agreement really carefully. Thankfully at our facility we have a very natural barrier (a door) that separates and segregates the two spaces well.
I am not having them take care of my horses (I have two). They can hire their own staff, procure their own supplies etc. That’s not because I think they are awful people, I wouldn’t lease to them if I thought they were, but I bought a whole facility because I didn’t like the standard of care that other people had, particularly around the availability around hay and stall cleaning. I’m picky and my horses get free choice hay, end of story.
For us, liability is a big one. They need to be responsible for repairs and things that may break. Horses are just freaking destructive. I am letting them use my tractor (it’s old, it’s ok) but with the understanding that they are essentially taking over its maintenance.
Parking is another big one for us, because of the way that the property is laid out.
I have stipulations in there for how they need to maintain their horses. Thankfully we had a LOT of discussions up front about that, and I believe they’ll do well. At the same time, I’m not having them care for mine just because I have certain standards and practices and they’ll have their own. I don’t want them changing how I feed, and I’m sure vice versa is true.
They were at their last place for 11 years and only are changing because the barn changed hands and the new owners are not working out. That’s ok.
I will say that of all the times I’ve seen it blow up, it’s been because the barn owner and the lessee had different ideas about maintenance, horse care, and just overall expectations. By keeping things very separate and clearly articulating others, I’m hopeful I can avoid some of those.
There will be things that are challenging. They have an active lesson program and our place has been pretty quiet. That introduces some things into the mix that we’ll have to work out. Generally speaking, both parties have very definite ideas about how horses should be cared for.
That particular-ness isn’t a bad thing, but it means very clear lines will need to be drawn to prevent control issues from taking over the relationship. It may not work, and we may need to be prepared for that, but in the short term, it helps keep the barn from going completely fallow with just my two mostly-retired guys and helps out someone who wants her program to grow but she can’t afford to buy the whole property yet. The goal will be to allow her to do so in 2-3 years.
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I’ve never done this and wouldn’t for many reasons but here are a few things to consider:
Is there a bathroom in your barn
Is there adequate parking for cars and possibly trailers
Is there turnout and will the lease’s horses be using it
Get a lawyer familiar with equestrian activities to write your contract, need to include actions for non-payment, liability, maintenance, repairs, cleaning and upkeep etc.
Check with your city or county zoning to see if a business is allowed on your property
Check with a tax attorney to see how a business will affect your taxes (including property taxes)
If you have a mortgage check with the mortgage company to see if they allow you to run a business on your property
Check your property/house insurance talk to them about liability of those people that will be leasing and boarding horses. Perhaps require them to insure their horses and provide updated vaccination records (even though you don’t have horses).
Decide on times when people or the person leasing the barn will be allowed on your property.
Maybe consider doing a background check on potential people interested in leasing
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Background checks and credit checks are incredibly easy and inexpensive to run. And completely agree with @js about requiring lessee to provide proof of proper insurance depending on their situation.
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How does one do this???
There needs to be a policy about visitors, guest riders, and what type of horse business is allowed. What service providers will be allowed too, and will outside trainers be allowed to offer training on your property.
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I’ve leased barns. I will say that I absolutely will not lease from an elderly person who has let the property sit largely unused and wants to live there and keep personal horses there, share facilities and micromanage how you use it. That is a nightmare. They always overestimate how good the condition is and frankly if it’s been sitting unused it’s for a reason.
My number one piece of advice is keep the costs and expectations reasonable so you attract and keep the tenant you want. For example I see people advertising a small farm (4 to 8 stalls, maybe not even a lighted ring) and wanting a trainer. That is not reasonable. No professional can run a business in a facility that small. That’s not a commercial facility. Your prospective tenant is likely a group of friends or one person with several horses or a breeder.
Rent wise I’ve run into so people who say “well it would cost this much to buy the property!!”. I’m not buying the property, I don’t get the house typically and I can’t make improvements or additions that would add value to the property for me. I don’t get any equity, and most barn leasors are looking for a long term place. I have to pay to move there and I have to deal with all the deferred maintenance and quirks of the property. I know going in there is a 90% chance it will not be maintained and any promised improvements won’t happen so I’ll be paying for that too or doing without. It’s worth a certain amount to me as a tenant and no more and your sale price is immaterial.
Passing “all the maintenance” to the leaser doesn’t work. When big items come up like redoing footing or a driveway they will just leave if you don’t address it. Stalls, fences, jumps etc - sure. If your 65 year old driveway culvert washes out? That’s not my problem. Same if your irrigation system breaks or the pump goes out. Be realistic.
Then yes all the logistics like parking, dogs, water, pastures, tractors etc. need to be addressed. Keeping your family and friends away from the horses too. But remember, every time you make a restriction based on it being your home you lose more prospective clients. Saying no-one can be on the property after 9pm or before 7am without special permission? No one who shows will accept that. Not allowing kids? Same.
There are always those farm hopping horse collectors out there looking for a new place to move their animal hoarding hobby. If you come across as unreasonable those are the only people who will want to rent it.
And yes please do background checks and search lawsuits etc, I do that on land owners too btw.
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Why do you prefer the idea of leasing the barn vs hiring a barn manager/trainer to work for you out of your facility? The latter gives you more control , although it also leaves you with more risk.
For lease pricing, a good option might be a flat base fee, plus a per horse fee.
Does your property have a second residence for onsite staff? if not, is your house far enough way that you are unlikely to be called on in an emergency? or are you ok being the person boarders contact if something needs urgent attention?
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Excellent points! Many of these are also on my list for consideration - liability being the biggest concern. I am not sure it is worth the hassle, but I also wouldn’t mind the freedom from most of the day to day work. Ideally, I would prefer to lease the whole barn but that isn’t possible right now. I could probably work out the use of our older tractor, but not the big one. The UTVs have been a source of big repairs over the years due to misuse by workers, so I’m inclined to not allow its use or charge a rental fee for it. I’ve had to replace more than I care to admit over the years because someone abused it. Just trying to figure out how to share so that it makes sense for both of us, and what kind of fee that would be is exhausting. If you’d be willing to share your agreement in whole or part, I’d love to look.
I’ve had trainers who did work out of our barn, but none were good managers or wanted to do so. Not many people want to be the ones responsible on holidays! I have thought of trying it again but haven’t figured out what would make that feasible. Trading a stall for time has never worked well, because something always come up and I end up having to be the one doing the grunt work. And no other residence available here
Most small to mid sized American facilities cannot support a wage-earning full time manager and have money left to go to the owner. They’d make more cash in hand renting it out.
