buying timberland for conservation and logging?

[submarinesailor]

i mean saving Americas forests from everything from fracking for natural gas to mining and subdivisions.

I have got to ask; what do you mean by saving the forest from fracking?  You need to remember that fracking and drilling are 2 TOTALLY SEPERATE operations.  Do you have a clue as to long many years and how many wells have been safely fracked in the US and North America?

A question for you:  How much of the US was covered in forest in 1900 and how much is forested now?  Again, I think you will be surprised at the numbers.

Bruce

[Overlength]

Start with whatever you can that fits with your plan. A dream of farmers also to make the land pay for itself. Just the right properties and combination of logging, farming, ranching, real esate and 10's of 1000's hours work can get you as far as you can last, you could at least make your kids rich when they sell everything after you die. 
You could add in a little conservation club money, raise funds, nature resort rentals, dude ranch,etc as a bonus when possible.

[Rocky_Ranger]

I'm always suspicious of individuals wanting to "save the forest"; kind of like the difference in fracking and drilling.  I always ask - save it from what....  So far, I've never had a good answer.  The best way to "feel" like you are doing good is to join The Nature Conservancy, or other land management/ecosystem/like thinking firm.  I like John Mc's answer best - that and either be born rich or hit the Powerball (but not tonight - I got this one) <grin>. 8)

[MyWorkingForest]

has anyone have any experience with cabin rental businesses? if i go through with getting help from investors i am gonna have some small cabins built even temporary ones like "cabins on wheels" lol so i can put a concession company in charge to manage them. even camp grounds to. this will be a starting base even if i do not make any money for myself.

[Jamie_C]

Not to rain on your parade but have you really sat down and crunched actual numbers on this ??

If you want to put up rental cabins you are going to need land, then you will need to clear sections of it to build said cabins, build roads, put in water & septic facilities, electricity, etc, etc, etc .... even if you want to rent "wilderness style" cabins you will need to be able to provide quite a few amenities. All of this stuff comes at quite a large cost. When you start talking about investors then you have people who are going to be looking at a ROI ... that means a certain cost ... hiring a management company ?? another big expense ... don't forget all the government permits, insurance costs, etc, etc, etc

There was a local company put up some cabins/chalets around here about 12 years ago. They did this on land they already owned, they milled a lot of the timbers etc themselves on a mill they already owned, did most of the work themselves and still almost went belly up. They had no outside investors who wanted a dividend payment, no management companies to pay, etc, etc   .... There is no easy way to make money when you start from scratch, you have to scratch, claw, dig and whatever else you can think of.

[Phorester]

How much money do you have to start your company?  If you already have several hundred thousand or more, you might make it work over time, with savvy business decisions, the right economy, and some luck.  But you need one positive direction to proceed.  Your ideas seem to be spontaneous ones developed from replies in this conversation, and are all over the map. It seems that they are only altruistic ideas, with no knowledge of the business or conservation world.  There is no one get-rich-quick scheme in the conservation arena that will make you immediately wealthy.

If you have little or no money and expect to attract investors, you will need solid business plans.  Talk to local business people, banks, etc., in the locality you want to start.

[KBforester]

This has to be the most exhausting thread I have read in some time. And its not even two pages long. 

[JohnM]

This has to be the most exhausting thread I have read in some time. And its not even two pages long. 

I'm sorry but...... :D :D :D :D :D  (yet I can't stop reading ;D)

[WDH]

This whole concept of buying land and paying for it with the timber value is an interesting concept.  As a Forester, and as a timberland buyer for part of my career for a large Forest Products Company, this dream of buying land and coming clean after cutting the timber was much discussed.  There were always stories where someone had supposedly done just that, but I never saw it happen in 33 years.  That is not to say that it did not ever happen or that it will never happen again, but it is an elusive goal as far as my experience.

If it could have been done, I would have jumped all over it when it would not have been a conflict of interest with my job.  As it is, I personally bought land three different times, and each time, the value of the purchase price far exceeded the value of the timber.  Never in my professional career with a mega Forest Products Company did I ever hear of it happening, even though as a company we purchased and sold millions of acres of timberland.  The market would just not allow it. 

You can buy land and pay for it with a timber management regime that provides a return, but you cannot pay much for the land, and it takes more than 1 timber crop to accomplish it.  You have to have a long term view, even longer than a single lifetime.  That is how the timberland investors look at it.

[Phorester]

Out of the hundreds of landowners I have worked with in the last 30+ years, I do know of one person who made a timber sale pay for his property purchase. I work with a landowner who bought about 800 acres of mountain timberland in 1953 or 54 for $26,000.  He had a timber sale in 1955 which brought him $27,000.  He has had maybe 3 or 4 timber sales since then, where he always got top dollar for the timber. So he & his family (he died many years ago) made out well. 

Two reasons he did well with this: 1/ He had good quality timber to begin with. It had not been highgraded to pieces by previous logging. 2/ He had either the VA Dept. of Forestry or a consulting forester mark and handle every sale he had.  So good quality timber was left in each sale for future growth.

But I doubt that you could do this in my area now.  Land prices are too high.

[Ron Scott]

I've seen it happen a few times a few years back where timber values exceeded land values when the prices of grade hardwoods and veneer were at a premium on well managed timberland.

[Phorester]

I have to add a third reason this landowner has done so well with this property.  It also has very good soils for growing healthy yellow poplar and oak of good quality.  In my opinion, soil type is the driving force behind good healthy forests. I often tell people who are looking for forestland to go to the soils maps and pick a property with good soils.

I also tell some that if you want to grow a good quality hardwood forest of high commercial value, to sell the property with poor soils you now own and buy some with good soils. Then, of course, manage it properly for the 50 or so years it will take to get it out of the poor quality highgraded condition its in now.

[GATreeGrower]

 

i am sure people will pay a lot for "eco lumber".

What you have is a dream. A dream that many more exerienced and educated people have had before you. Reality "bites". It sounds as if you have little or no capital, and the same level of knowledge. While I'm right there with you with what you'd like to do, I'll come out a say what a lot of the Forum members will not. You have a dang near impossible goal ahead of you, particularily in a short time frame. There are some members here who have developed some nice properties through hard work and time. I don't think any of them have made a "ton of money" from their properties. It is usually the other way, start with a "ton of money" and then you can get your property. I wish you the best of luck if you go forward, but don't set yourself up for failure. Talk to mill and proerty owners, loggers, and lumber sellers, and get a realistic picture of what you propose. Good luck.
Mark

Excellent reply...if you are trying to build timber plantations, you will never truly make a "ton" of money....you will be putting a great deal of your money back into the land you already have and the land you try to acquire.

[Dobie]

1st, new to the forum and wanted to say hello.



As for the question in hand, I believe a person can make money investing in timberland if they are in certain parts of the country.  When I got out of the AF as a lowly grunt, I wanted to be involved in timberland as I was always amazed by how much Grandma got for her 25 acres of timber when I was a young boy.   My first purchase was a 110 acre tract of land near Oil city in nw Pa. in 2004.  I was really green and basically had no idea what I was doing but the seller took $120k and agreed to accept 50% down and finance the rest for 10 years.  Got a forester who did a lot of head scratching when I showed him these big beautiful trees that turned out to be black birch.   Like I said, I had no idea what I was doing.  Still, ended up getting $105k because there was enough cherry, maple and oak mixed in along with well over 300,000 ft of volume.  Sold the remaining property for $57k which gave me a nice little profit.  I used the proceeds and also borrowed against my home to buy a 2nd piece.  110 acres near Tionesta, Pa.   Cost was $195k.  Had 3 separate timber sales and received $201k.  Sold the remaining land in 3 separate parcels for $185k.  Used that money and bought a 52 acre parcel near Cranberry, Pa that was land locked for $46k and a 25 acre parcel near Tionesta for $85k.  Got a right of way for the land locked parcel for $7500(what the farmer in front of me owed on his Kubota tractor) and did a small TSI which netted $23,800.  Sold the parcel a few years later for $82k.  The 25 acre parcel was logged and we made $105k.  Mature and high grade oak.  Sold the land for $33k a few years later.  Then we bought a 110 acre parcel in Clarion County for $195k(my magic number).  We had 12 different sales and this was the first time we sold logs at the landing.  Made $127k from timber and sold the land for $185k.  Actually didn't do as well as the numbers suggest because we accidentally purchased the neighbors home(part of original tract that was incorrectly subdivided) and cost us $40k in attorneys and to settle.  Then we purchased a 131 acre tract of land in sw Crawford for $195k but have only cut $35k in timber as I finally realized you need to manage the forest and we also decided to live here.


All the properties above were bought from local realtors including Timberwood realty of Tionesta, McVey Reality, Coldwell Banker and Howard Hanna.  I've literally looked at hundred of pieces of land and the pickings are slim but they are out there if you're willing to put in the work.  I'll be honest and admit when I first started buying land, I couldn't tell the difference between a maple and oak tree but I've learned as I went.  Got incredibly lucky a few times early on and things just happened to keep rolling.  I understand in the south things are much different because of land prices but there always seems to be bargains out there if a person looks hard enough.

[terry f]

   Welcome Dobie, were you doing the work, and are those numbers what you cleared.

[Dobie]

Thanks for the welcome.


The numbers posted above were before paying my forester 9 - 10% except for the Cranberry piece which was net.  The Clarion job also included the expense of the logger which was $135/1,000 ft logged, skidded and bucked.



I did none of the logging myself.