Church's Latest Real Estate Scheme

[_Mormonicious]

http://www.orlandosentinel.com/news/os-deseret-metropolis-state-review-20150704-story.html#

The Florida Department of Environmental Protection said in a one-page report it conducted a "detailed review" of a plan by Osceola and Deseret Ranches to host a decades-long rise of a Central Florida metropolis of a half-million residents within a 133,000-acre corner of the county.

You guys STILL DON'T GET IT! They are proposing alternate uses for the "Largest Cattle Ranch" in North America (https://en.wikipedia.org/wiki/Deseret_Ranches).

WHY would you sell a cash producing enterprise other than THEY NEED THE MONEY! The Mormon Corporation has been outspending their income for the last 5 years. They have almost depleted their cash reserves and need other sources of income. How do you make money FAST, SELL ASSETS. This is not the Mormon Corporation looking at becoming land/home developers, this is the Mormon Corporation ceasing an low return income ASSET into a CASH CONVERSION.

THE Mormon CORPORATION IS HURTING.

[_honorentheos]

Growing up, Joseph Smith-as-city-planner was a theme often trotted out to demonstrate just how awesome a guy he was, and clearly inspired. The fact Salt Lake City was laid out with streets unreasonably wide for turning around ox-carts or unruly easterners, only to be in the Goldilocks zone for auto use a century later was another proof offered up to show Mormons were being led by God. It never occurred to me then, nor to anyone I talked to, that the autocentric type of development being presented as proof of inspiration was damaging the country in many ways and was already considered a pariah to urban planners. One only has to visit downtown SLC today to see that even the LDS church has gone pedestrian- and mixed-use friendly to a large extent on it's home turf. Oh well. I'm sure Joseph was still a bad ass military leader...

I'm tempted to project this thinking onto the development plan proposed in the OP, though. I'm trying to imagine the world where it turns out the ideas presented in sketch form in the OP link are seen as prophetic 100 years from now. It clearly violates almost every principle of smart cities and seems more like the planning mindset from 50 or 60 years ago than a modern or innovative approach to tackling the creation of what is effectively a large suburban city. I'll say this much - if the future plays out in a way that validates their planning, they may have some claim to prophetic insights because they aren't apparent now.

[_Mayan Elephant]

You guys STILL DON'T GET IT! They are proposing alternate uses for the "Largest Cattle Ranch" in North America (https://en.wikipedia.org/wiki/Deseret_Ranches).

WHY would you sell a cash producing enterprise other than THEY NEED THE MONEY! The Mormon Corporation has been outspending their income for the last 5 years. They have almost depleted their cash reserves and need other sources of income. How do you make money FAST, SELL ASSETS. This is not the Mormon Corporation looking at becoming land/home developers, this is the Mormon Corporation ceasing an low return income ASSET into a CASH CONVERSION.

THE Mormon CORPORATION IS HURTING.

whoa. now this is a conversation now. what else ya got mormonicious. this is good crap.

[_zeezrom]

When we visited Utah this spring, I kept thinking, Damn these roads are huge!

I recall seeing a few roads east of downtown SLC changed to have large, planted medians. Gotta do something with all that extra space. I loved the little roads in towns in Greece. They were a joy to walk down albeit crowded. I think the city builders of that country were more inspired than Brigham Young.

[_I have a question]

They are proposing alternate uses for the "Largest Cattle Ranch" in North America (https://en.wikipedia.org/wiki/Deseret_Ranches).

WHY would you sell a cash producing enterprise [?]

Now that's the right question.

The only conclusion that can be reached is that the latter development will produce a bigger return than the former. It's not a charitable venture, it's not non-profit, it's not furthering any specific mission of the Church. I think you are correct, this is about cash flow.

[_Mayan Elephant]

The only conclusion that can be reached is that the latter development will produce a bigger return than the former. It's not a charitable venture, it's not non-profit, it's not furthering any specific mission of the Church. I think you are correct, this is about cash flow.

i think deseret ranch is considered a for-profit ranch, but it is also a farm and benefits from a ton of benefits for that.

the more i think about this, the more i agree with mormonicious. i have always thought that these huge constructions projects were always going to show negative ROI but positive cash payments to friends and family. it is a way to monetize the assets without paying a dividend. this project could really do both - generate cash flow and generate a huge cash return to friends and family.

[_I have a question]

The only conclusion that can be reached is that the latter development will produce a bigger return than the former. It's not a charitable venture, it's not non-profit, it's not furthering any specific mission of the Church. I think you are correct, this is about cash flow.

i think deseret ranch is considered a for-profit ranch, but it is also a farm and benefits from a ton of benefits for that.

the more i think about this, the more i agree with mormonicious. i have always thought that these huge constructions projects were always going to show negative ROI but positive cash payments to friends and family. it is a way to monetize the assets without paying a dividend. this project could really do both - generate cash flow and generate a huge cash return to friends and family.

I'm shocked that you would think the Church would use nepotism in a free tendering situation like this, shocked I tell ya.....

[_Doctor Steuss]

WHY would you sell a cash producing enterprise other than THEY NEED THE MONEY!

This is certainly possible. I think it also likely they simply realized there is potential for a greater rate of return. If they need money right now, this isn’t a very good way to go about it. A master planned development will take years to get off the ground, and even then it will likely take several decades for it to start to reach any form of appreciable maturity. There are also a lot of upfront costs that the master plan corporation will have to carry, such as offsites (power, water, gas), roads, architectural and city planning, permitting, and so on.

Just some round numbers on the return potential as an example from Howard Hughes Corporation’s master planned community, Summerlin in Vegas. Currently, a builder can expect to pay $86,559 per lot up front (and this is the cheapest at the highest density allowed in the master plan – from here lot prices just go up and up and up). There is a price participation rate on top of that which is calculated off the final sales price of each home. These range between $9,000 and $40,000, depending on the size of the home, and upgrades. We'll go with $15,000 extra for our example, and round the total cost of each lot down to $100K.

The average household is 2.54 people, so we'll round that up to 3. This gives us over 160,000 projected homesites in a master plan of 500,000 people. At $100K each, that is a potential yield of $16 billion in homesites alone – and that’s if home prices don’t budge in the area over the next few decades. There would also be either land sales or leases for all of the businesses, hospitals, schools, and so on. There will likely be requirements for developers to purchase and allocate land for every certain amount of homesites, to be dedicated as public space. The master plan could also anticipate revenue for the association while it maintained majority share (which would be at least a decade or more).

So, there is an incredible profit potential, but it will take decades to realize.

[_Mormonicious]

The average household is 2.54 people, so we'll round that up to 3. This gives us over 160,000 projected homesites in a master plan of 500,000 people. At $100K each, that is a potential yield of $16 billion in homesites alone – and that’s if home prices don’t budge in the area over the next few decades. There would also be either land sales or leases for all of the businesses, hospitals, schools, and so on. There will likely be requirements for developers to purchase and allocate land for every certain amount of homesites, to be dedicated as public space. The master plan could also anticipate revenue for the association while it maintained majority share (which would be at least a decade or more).

So, there is an incredible profit potential, but it will take decades to realize.

Yeah, HOWEVER, the land developer is not necessarily the building developer. While the Mormon Corporation owns the land, its real value is in the structures. It is unlikely that the Mormon Corporation is going to build the houses. They might develop the shopping malls and other commercial interest.

Remember City Creek Center Condominiums are currently only 28% sold. That's a lot of money to sit on.

[Guest]

Remember City Creek Center Condominiums are currently only 28% sold. That's a lot of money to sit on.

WTF? seriously? are they leased out or empty?

http://www.realtor.com/realestateandhom ... T582512556

jesus. paying 12k a year in taxes as it sits. nice. well done gordon.