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Eastern Iowa | What is a used building worth? Price per pig space at the time it was built, prorated over 10 years equals 50%?
example 1200 hd building built in 2005, 200/pig space
1200x200=240000x50%=$120,000?
Anyone know what a 1200 hd building cost per pig space each years average from 2005 to 2010 is?
2005?
2006?
2007?
2008?
2009?
2010?
Or if a building is 10 years old, half of new today approx. $150,000?
I may have to opportunity to buy a used building or buildings from those date ranges?
Or just build new?
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West Michigan | My guess would be way less then half. I bought a 10 year old one and that I'd when the problems start.. Add 10 more years and the value of the barn is about nothing... Also all repairs that are need the next 10 years. Gated slates roof fans curtains driveway gavel bins and the list goes on...The question is do you want to work for free just to get manure?? If I had to do over would have tried to go to 8k to cash flow better and able to hire somebody instead of trying to do double duty.. Crop farming at day time and hog farming at night gets old after a while. Also when crop farming winter you have to be around to take care of hog instead of going on holiday..
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ne iowa | I would think 1/2 price would be attractive because you could have them paid off twice as fast and be making money. I know there are more repairs but after 10 years all the curtains, fans and augers have been repaired/ replaced once all ready. I have just as many repairs in my 1996 curtain barn as my 2006 tunnel barn. The same is true for my 1988 monoslope but the doors on that one need to be either replaced or majorly overhauled. The rest is pretty good yet. It is partial slat so don't know how much I want to throw at it |
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Eastern Iowa | ISUJIM,
Half price of a current new barn or half price of what it cost in 2005?
What has it cost per space per year for repairs in 8+ year barn on avearge, any idea?
Thanks |
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Buffalo IL | Appraiser told me several years ago he could only value them at 10 cents on the dollar built even if brand new when putting a value on a farm. This was probably 5-7 years ago. |
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| Without knowing a lot more and ideally seeing the buildings its impossible to put a value on them.
There is such a huge variance in building designs, construction quality and previous maintenance that they could be complete junk ready for the excavator or they could be in like new condition.
A 10 yr old quality built and well maintained building will sell for more than 50% of new. For 1 it is sitting on land, its got the utilities hooked up, the permitting is done and it likely comes with a pig flow.
If you've never built a new building, it is a headache prior to and while being built. Then when its done and ready the migraines show up.
If a building is properly built and well maintained it can last a lot longer than 20 yrs but it does take more maintenance as it ages.
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Badger State | Why would anything be valued on what it cost ten years ago ? |
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n.c.iowa | that's a tough one too answer, what kind of barn, does it come with a pig flow, manure easements, do you get the manure, condition, what kind of up keep did it have, room for future expansion????? as far as the per pig space building cost. depending on building type, start with about $265 todays cost and deduct about 3% per year for the preceding years and that will get you pretty close. that's for a curtain sided natural vent building, no land, well,or permitting. |
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Eastern Iowa | I can think of a few,
1. Most new building cash flows that I have seen value the building at 50% after 10 years, therefore 50% of new at time of construction.
2. If its gonna cost me 10/space per year in major repairs for the next 5 years to get me 10 more years on a 10 year old structure, Then I might as well build a new building have it paid off in 10 years, then put 10/space/year for 5 years to get another 10 years and I don't have a mortgage payment.
3. Hog buildings are not like homes and other realestate as many have given there opinion, they are really a dumb investment as I have read. So building a hog barn and expecting to Flip on HGTV for a profit seems silly. If you can have it paid for in 10 years, got the manure value out of it, and sell it for 50%, I would do that in a heart beat.
If I could take $2000 (20% DP) buy $10,000 acre land and sell it in 10 years for $5,000 and have all my expenses covered, Interest, paid my self a wage, that equals me paying myself 25% interest on investment, better than a CD. ( I believe my math is close) You would have to pay yourself $500/ac in rent to get that return, that's not gonna work in my area this year, probably not next year either.
That's why I think 50% of new at time of construction is still enough, actually after typing out this post I like the 5 to 10 cents on the dollar.
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| litljon - 1/11/2015 10:15 actually after typing out this post I like the 5 to 10 cents on the dollar.
Do you have a 10 yr old finisher you'd like to sell? For a dime on the dollar it'd be worth it for the pit even if the building is shot.
Paying off a new building in 10 yrs isn't gonna happen either unless you put down a pretty good sized down payment.
The value of a 10 yr old building is determined by two people, a seller that is willing to sell for x and a buyer willing to buy for x.
What it cost to build 10 yrs ago means absolutely nothing, it doesn't matter. What it cost to replace is somewhat relevant but not 100% either, its what someone is willing to sell for and another is willing to pay.
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n.c.iowa | Kooiker - 1/11/2015 21:36 litljon - 1/11/2015 10:15 actually after typing out this post I like the 5 to 10 cents on the dollar. Do you have a 10 yr old finisher you'd like to sell? For a dime on the dollar it'd be worth it for the pit even if the building is shot. Paying off a new building in 10 yrs isn't gonna happen either unless you put down a pretty good sized down payment. The value of a 10 yr old building is determined by two people, a seller that is willing to sell for x and a buyer willing to buy for x. What it cost to build 10 yrs ago means absolutely nothing, it doesn't matter. What it cost to replace is somewhat relevant but not 100% either, its what someone is willing to sell for and another is willing to pay. |
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SW MN - mt. lake/windom | If your serious about buying and you have to barrow money mist likely you will have it appraised. First, check to see if anyone has first right of refusal, you may just be a pawn. Next run a 10 year cashflow, most likely there may not be sufficient enough sales that an appraiser would use multiple methods of determining value, one would be like kind sales, another would be cashflow. Condition matters, keep in mind about 40% the cost of the building is under the pigs feet. For reference, I had a mid 90's site appraised 3 years ago, 1800 hd lagoon site at a value around $135 per space. I would estimate very little depreciation on existing site. I would estimate values in the range of 180-220 per space. |
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ne iowa | When I built mine it could be paid off in ten years with 10% down. I think I could sell it to my neighbor if he could pay for it in 5 years. That is what I meant by 50%. That would be a good deal for both of us. That 15 year old paid off building will make a lot of money plus the manure. Yeah some repairs but not THAT much. |
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ne iowa | A 1250 head barn at 10/head repair bill is $12500. I don't have exact records but I might have paid $1000. My own labor however. Where did you get $10/head? |
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southeast Iowa | Must disagree with you on it takes two to find value. It only takes one and that is the guy righting the check. Doesn't matter what the seller wants if no one will write him a check. |
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Alton, Ia | It takes two. If I write a check for 50% of the asking price, and the seller turns me down, is that a sale?
Edited by Oliver1 1/11/2015 19:25
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Alton, Ia | johnny skeptical - 1/11/2015 09:52
Kooiker - 1/11/2015 21:36 litljon - 1/11/2015 10:15 actually after typing out this post I like the 5 to 10 cents on the dollar. Do you have a 10 yr old finisher you'd like to sell? For a dime on the dollar it'd be worth it for the pit even if the building is shot. Paying off a new building in 10 yrs isn't gonna happen either unless you put down a pretty good sized down payment. The value of a 10 yr old building is determined by two people, a seller that is willing to sell for x and a buyer willing to buy for x. What it cost to build 10 yrs ago means absolutely nothing, it doesn't matter. What it cost to replace is somewhat relevant but not 100% either, its what someone is willing to sell for and another is willing to pay. i'd like a piece of that action too kookier. most hog barns around here, when the odd one does come for sale sell for around 80-110% of the original building price. now i'm not talking about 300 head partial slat type buildings, but barns that a contractor would be interested in. if anybody knows of any 1200 head or bigger barns for sale in north iowa at 10-20 cents on the dollar, my contact info is in my profile.
Hey, hey, didn't your momma's teach you boys to share? :)
I'd give any "modern" finisher a hard look at 10 cts. The most popular transfer around here are defunct sow units, buy them and renovate into finishers. Farrow the pigs up in the Great White North, or Wild Wild West, anywhere by NW Iowa. |
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Eastern Iowa | I saw someone post earlier about investing $120,000 in repairs after 10 years or so to get it back to new shape. $12,000 per year for 10 = $120,000. That said it may have been a 2400 he unit so $5 may be used then for a 1200. |
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| raccoon12 - 1/11/2015 19:04 Must disagree with you on it takes two to find value. It only takes one and that is the guy righting the check. Doesn't matter what the seller wants if no one will write him a check.
So by that definition if I offer you $1000/acre for a piece of nice 80+ CSR farmland that is all its worth even if you won't sell it to me for that?
In order for it to matter it has to be a sale, if the seller won't let it go for the offer its worth more to him than is being offered.
You can offer me $20/space for my 20 year old finishing building any time you want, I won't sell it for that because its worth much more than that. Cripes, the profit in that building is more than $20/space/year.
$20/space wouldn't even buy my dad's 40 yr old partial slat building, for the same reason as above.
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Columbia Basin, Ephrata, WA | IL cow man - 1/11/2015 07:12
Appraiser told me several years ago he could only value them at 10 cents on the dollar built even if brand new when putting a value on a farm. This was probably 5-7 years ago.
Yeah well, 5-7 years ago was not a good time to be buying livestock buildings. Their value might have changed a little since then, like everything else.
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Used Hog Confinement Price
