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A 159-acre tract of farmland west of Zionsville that once listed for $3 million sold in late September for about a third of the original asking price.
Another farm, this one 55 acres and on the east side of Boone County near Indianapolis Executive Airport, has been discounted nearly 20 percent and is available for $1.3 million.
Though the properties are in the same county, they illustrate a broader quandary among owners of suburban farmland across the Indianapolis area. Farmland at the edge of sparkling new subdivisions, office parks and warehouses fetched top dollar for development before the economy tanked, but its value has plummeted so far that experts now struggle to put a value on it.
“We’re going through the biggest re-pricing of real estate in the history of the modern world,” Colliers International broker Ross Reller said. “That’s not an overstatement, that’s a fact.”
Reller listed the 159-acre tract just southwest of Interstate 65 and State Road 334 for a unit of Columbus, Ohio-based
Huntington National Bank, which took the property back from previous owner Fellowship Investments. Reller wouldn’t divulge some details, but said the property sold for more than $1 million but less than the $1.75 million asking price.
Despite the markdown, Baptist, which owns the 150-acre Hoosier Village seniors complex near West 96th Street and Zionsville Road, pulled off the purchase only because it had the cash on hand.
In this depressed real estate market, cash is definitely king. In fact, that’s about the only way deals are getting done.
A lack of traditional bank lending, coupled with tepid demand for new development, is making it far more difficult than ever to value land considered attractive to both commercial and residential builders.
Another reason land isn’t moving—and perhaps the most important—is that owners are reluctant to part with their property until prices rebound. They know what it brought five years ago and would rather wait for a turnaround instead of letting it go at such a bargain.
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