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99yr Lease

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PureCountry

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Oct 25, 2005
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Edgewood, BC, moving to Hardisty, AB
Curious to know if any of you have experience with long-term leases, 99yr and the like. Have a chance to wrap up some pasture land with a relative who doesn't live in the area, and has always said it'll be ours as long as he and I are breathing. We'd like to put something on paper, but I want to get some ideas down before we consult a lawyer.

Any thoughts, experiences or words of wisdom?
 
Your relative has only agreed to a "breathing" term. If that stops in either party the lease is terminated so the 99 years would be of little value. How old are both of you? Does he have heirs that may want to sell the land upon his death? I'm not sure you can tie enough terms down to really be that beneficial since he has said the lease is good as long as both are breathing. Is this property necessary to your survival financially or is it something you would really like to have but could live without? By his comments he is saying all bets are off if he passes on...or if you do. In the event of a death I'd sure try to maintain the lease through that years grazing period but beyond that I doubt you can effectively tie him down. In addition it could be offensive to him that you didn't trust his word and wanted to tie him down. I'd tread lightly. I think you are just going to have to accept this one and be glad to have the land as long as you can.
 
Yep- I think Red Barn Angus hit the nail on the head-- the lease with the owner is only good as long as he is alive-- and I doubt he is going to live 99 more years....Now there is a way- to set up a long term lease- and a trust giving you the right to keep the lease (or manage the trust) after the lessors death- but he and you are going to have to set down with an attorney to work all that out....
 
I got the place next to me leased last year. It's only a 1 year lease, but if the place need to be sold for any reason I have first option to buy it. I guess that is as fair as I can expect.
 
Had a long term lease on prop next door and spent considerable time and money improving it . Of course that improved the value of it when the landlord finally wanted to sell it :roll: Guess who payed for that too :wink: If your looking for long term commitment for pasture try buying it first if possible. Just trying to save you a few bucks :lol: :lol:
 
My preference of course would be to buy it, not sure if he'll go for it, but that's my Plan A. Plan B is the long-term lease, with having the first right of refusal. The way I had planned was to propose a deal my uncle made with a landowner. If the renter makes substantial improvements(fencing, water systems, etc), the original value of those improvements would be deduced from the sale price.

For example, if I invest $10,000 in the next 5 years in fencing and such, and Mr. Landlord decides to sell in 12 years, obviously the property value will have increased due to my improvements, but also due to regional inflation. It would get too complex to try and work out inflated values of the improvements, so once a price for the property had been agreed upon, the original $10,000 in improvements would be deducted from said price. Simple, but fair I think. Of course there's the chance that we may not agree on a price, and the improvements will be a tough pill to swallow when he sells to someone else, but that's the risk.

Anyway, thanks for the responses. Was just curious what others had done.
 
When we bought our ranch, it came with a tough non-cancelable lease on the farm ground.

The lease was such that no one would buy it until we came along and it had about 5 years to run. We figured we could tough it out and we did.

Long term leases can be tough on either party. As soon as the lease ran out, we sent the tenant on his way. I got tired of finding his hand in my pocket all the time. The tenants were super good farmers, but they chiseled every way possible - and to this day, I don't think they figured out that I knew what was going on.

A good lease is fair to both parties and should have a clause that allows renegotiation if something unforseen comes up. I'll be either a landlord or tenant, but I have to have some trust in the other party.
 
Don't look a gift horse in the mouth. If your relative is trustworthy, you have his word. If not what good is his name on a piece of paper? What do I know, for I am of the old school?
 
I'd say you know plenty Shortgrass. But we're looking at this from different angles. You're right, his word should be good enough, and honestly it is. My reason for concern is that if something should happen to him, he's divorced with an 11yr old son, and the only other relative is his sister who lives outside the country. My intent with long-term planning with my relative is to have some security quite possibly after both he and I are gone. Stewards come and go, the land is here forever.

Take care Shortgrass.
 

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