Re: Shares on row crop

Posted by kyhayman on November 19, 2009 at 21:21:25 from (99.197.64.56):

In Reply to: Shares on row crop posted by Reid1650 on November 19, 2009 at 20:16:33:

I'd pass on the deal from either side. As someone looking to rent on shares a share lease is a binding contract for a set term. I'd want to be real sure that he has the authority to bind the owners to your lease. Somehow this doesnt smell right to me. Also, how will you pay your part to him and how do you know it gets credited correctly. He may be ok or you could be on the receiving end of having to pay him a share and then some time later being hit with a bill to pay the same share to the actual owners. Make sure if you do you are contracting with the farm, with him as the agent.

If I was him, honest, and was looking renting it out, I'd pass. No way Im giving anyone 70/30, especially if Im managing someone elses land and money. I might do 60/40 if I didnt have to pay the fertilizer bill but that would be top dollar.

I've also been the middle man before, on both sides of these kinds of deals so its kind of do as I say not as I've done. As someone who has leased and then subleased I made my money on the spreads but I always kept it to a cash rent deal. Tried to make at least 25% on a cash lease or, the few times I've done shares I've felt like I needed double that on average yields. When I dealt with a middle man, I made sure all payments went to the farm name. These deals have more ways to bite you than a bucket full of rattle snakes.

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