The last 10-15 years have seen many opportunities for property owners to enter into significant energy production opportunities. Before deciding to sell a property it is important that you explore the green energy potential that your property may possess.

There are many factors that will come into play including but not limited to proximity to transmission, slope of property, sun days, wind history, and archeological, to name a few.

And of even greater importance is who to lease your property to. Being a landowner, I almost monthly receive a card or letter from a solar or wind company. Their level of experience and competency varies greatly. Some are worthy and some are not. Beware of those wanting to tie up your property for an extended time but don’t have the resources to put a sound project together. Their goal is to get property secured and then move ahead trying to create an opportunity for themselves. I believe it is far better to work with a company that can fully fund and develop the wind and or solar project.

I have seen and worked with both types and one must sort through the interested parties. You must ask questions and research the companies to be assured of a positive outcome. It is also important that you enlist the services of a knowledgeable attorney familiar in these matters.

Having worked in the farm and ranch real estate brokerage business for over 50 years, our company regularly speaks with property owners that have wind now, or are in negotiations with wind and solar companies, or would like to explore that income generating opportunity. We have been directly involved with the energy sector for several years and have assisted in those projects.

With that in mind, rather than selling your farm, you can list for lease, with a knowledgeable real estate broker, the wind and solar opportunity of your land. We then actively market nationally to qualified developers. These projects are not one-year issues. They generally take 5 to 7 years to get a project matured and built. If built, there can be generational wealth for the property owner for many years. It is something to consider.

If a project is built and the income stream is established, you could still retain your farm and sell that income stream. Thus, the terms and conditions of your lease are very important. You may want to keep your land and the new income stream. But, you have choices, keep it all together or sell the farm but retain the new green energy income, or sell the green energy income and keep the land. But, having that additional income increases the value of your land and its energy producing assets significantly and provides tremendous flexibility in those decisions. An additional income stream is available if the developer installs battery storage on site. Keep that in mind.

These solar projects can go on a relatively small tract of 10-20 acres. However, there are also energy projects of 500 acres and larger.

Jim Whitney, CCIM