Help an appraiser determine the right value of a motocross track

michelewood
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michelewood
Edited Date/Time 4/6/2019 11:53am
Hi everyone, I'm working on a real estate appraisal of a motocross track in Texas. This is a tricky property type and there aren't good "comparable sales" easily found. I'd love any feedback from owners or operators of facilities or parks that might shed light on how you determine the value of your facility. If you were to sell your business, would you break out the real estate? If so, would you use a multiplier on the income for the business portion? How often are these properties leased, and when they are, how are lease rates determined? Any help much appreciated! I'm not a motocross rider, but I'm really enjoying learning about the sport and connecting with folks in the MX world.
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ybarbo17
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ybarbo17 4/5/2019 9:10am
4/5/2019 9:10am
which track?
-MAVERICK-
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-MAVERICK- 4/5/2019 9:19am
4/5/2019 9:19am
I think more information is needed in order for you to get a better answer from people.

Location?
Acreage?
How many tracks?
Outbuildings?
House/Houses?
Heavy equipment?
Years in business?

Any pics?
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michelewood
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michelewood 4/5/2019 9:20am
4/5/2019 9:20am
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
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-MAVERICK-
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-MAVERICK- 4/5/2019 9:22am
4/5/2019 9:22am
Without information it'll be very difficult for anyone to help you out.

RV hookups add to the value.

Good luck.
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gt80rider
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gt80rider 4/5/2019 9:24am
4/5/2019 9:24am

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michelewood
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michelewood 4/5/2019 9:25am
4/5/2019 9:25am
i completely understand. I will go back and see what information I can disclose. In the meantime, any "rules of thumb" would be really helpful, especially in breaking out the business value, typical lease terms, etc. I found some related threads on this site that have been helpful with estimated numbers, etc. and was hoping for some help that way.
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Casting
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Casting 4/5/2019 9:25am
4/5/2019 9:25am Edited Date/Time 4/5/2019 9:41am
After careful analysis the value is determined to be exactly... tree fiddy

edit: dang it! gt80rider beat me to it!!
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ybarbo17
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ybarbo17 4/5/2019 9:32am
4/5/2019 9:32am
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
i live in the area so I'm pretty familiar with all the tracks

location a big part, if its rio bravo... that's in a bad part of town stuff always getting stolen from them and they've been on the news a few times that would be a big issue for a possible buyer
michelewood
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michelewood 4/5/2019 9:35am
4/5/2019 9:35am
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
ybarbo17 wrote:
i live in the area so I'm pretty familiar with all the tracks location a big part, if its rio bravo... that's in a bad part...
i live in the area so I'm pretty familiar with all the tracks

location a big part, if its rio bravo... that's in a bad part of town stuff always getting stolen from them and they've been on the news a few times that would be a big issue for a possible buyer
No, it's not that property. But that's helpful to understand. Thank you!
tprice07
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tprice07 4/5/2019 9:38am
4/5/2019 9:38am
It's worth what the land is worth.
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michelewood
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michelewood 4/5/2019 9:40am
4/5/2019 9:40am
tprice07 wrote:
It's worth what the land is worth.
So, a buyer wouldn't give any value to the buildings, track, parking lot, RV hookups?
Sheriff245 4/5/2019 9:43am
4/5/2019 9:43am
tprice07 wrote:
It's worth what the land is worth.
michelewood wrote:
So, a buyer wouldn't give any value to the buildings, track, parking lot, RV hookups?
It depends what their intended use for the land is.
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SEE ARE125 4/5/2019 9:45am
4/5/2019 9:45am
Value of the land plus 3-5x the average annual profit over the last 3yrs is a good starting point.
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michelewood
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michelewood 4/5/2019 9:49am
4/5/2019 9:49am
tprice07 wrote:
It's worth what the land is worth.
michelewood wrote:
So, a buyer wouldn't give any value to the buildings, track, parking lot, RV hookups?
Sheriff245 wrote:
It depends what their intended use for the land is.
That's true, and if the buyer wanted to redevelop to another use the likely value would be vacant land value minus cost of demolition. I'm more interested in what value a new user would attribute to the in-place improvements. Say, if the owner of the park wanted to retire or sell for other reasons, and a new buyer wanted to keep the property running as a track (either as an owner/operator or leasing it out to an operator).
michelewood
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michelewood 4/5/2019 9:51am
4/5/2019 9:51am
SEE ARE125 wrote:
Value of the land plus 3-5x the average annual profit over the last 3yrs is a good starting point.
Thank you!!
newmann
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newmann 4/5/2019 10:19am
4/5/2019 10:19am
SEE ARE125 wrote:
Value of the land plus 3-5x the average annual profit over the last 3yrs is a good starting point.
michelewood wrote:
Thank you!!
Most tracks operate on a cash only basis so no telling how much actually gets reported as income. Profit? Laughing

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michelewood
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michelewood 4/5/2019 10:27am
4/5/2019 10:27am
I have the sale of Oak Hill Raceway in Texas (northwest of Fort Worth in Alvord). It sold last May. It is 185 acres and that included a nice SFR on site plus the outbuildings, 239 RV hookups and the heavy equipment included. (John Deere 650H Dozer, John Deer 544H Loader, New Holland TM 115 Tractor, New Holland TD5050 Tractor, Sterling Water Truck, International Water Truck, GMC Water Truck, GMC 6 Yard Dump Truck, misc. water pumps and dirt working equipment. Email me at mwood@valbridge.com if you want the details on price.
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davbrucas
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davbrucas 4/5/2019 10:44am
4/5/2019 10:44am
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
Danny finally have enough with all the thieves in the area and looking to sell Rio Bravo?

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Tim507
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Tim507 4/5/2019 10:50am
4/5/2019 10:50am
Land value for not being a MX track plus a % of the last 10 year margin after all costs accounted for
JohnnyD13
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JohnnyD13 4/5/2019 6:51pm
4/5/2019 6:51pm
As a business it’s a little sad that having a track on the property wouldn’t add value. I sold my place for land and assets value only. If you charge more then 30 bucks to ride your a crook in the moto industry. Having owned a track and a business, it should be a lot more to ride a groomed track.
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mxtech1
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mxtech1 4/5/2019 7:06pm
4/5/2019 7:06pm
If its just a race track setup, a person would have a tough time taking on a big mortgage on and being very profitable with it. The operating expenses are high and it would be constant pressure to have big turnouts to pay the bills.

The real value would be in a training facility setup with multiple tracks, lots of RV hookups, and other onsite facilities. Some facilities charge upwards of $20k for an annual training program with shorter options to make it more affordable for a week of training ($1,000).

If a facility could get 12 riders per week in the $1k weekly training program for 40 weeks/yr, that's $480K. And if you could keep 10 "full timers" onsite year round that's another $200K.

atrdrvr7
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atrdrvr7 4/5/2019 8:17pm
4/5/2019 8:17pm
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
swtwtwtw
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swtwtwtw 4/5/2019 8:20pm
4/5/2019 8:20pm
A billion dollars.
Tarz483
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Tarz483 4/5/2019 8:38pm
4/5/2019 8:38pm
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
atrdrvr7 wrote:
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months...
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
The answer was already given above
atrdrvr7
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atrdrvr7 4/5/2019 8:53pm
4/5/2019 8:53pm
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
atrdrvr7 wrote:
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months...
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
Tarz483 wrote:
The answer was already given above
No it wasn’t. You may want to read the post again. The OP listed a track in Dallas they were trying to use for a comp. It’s not the one for sale.
Tarz483
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Tarz483 4/5/2019 9:00pm
4/5/2019 9:00pm
atrdrvr7 wrote:
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months...
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
Tarz483 wrote:
The answer was already given above
atrdrvr7 wrote:
No it wasn’t. You may want to read the post again. The OP listed a track in Dallas they were trying to use for a comp...
No it wasn’t. You may want to read the post again. The OP listed a track in Dallas they were trying to use for a comp. It’s not the one for sale.
Oh i thought it was Oak hill since it was the original poster
Saying that
Dirty Points 4/5/2019 9:04pm
4/5/2019 9:04pm
atrdrvr7 wrote:
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months...
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
Tarz483 wrote:
The answer was already given above
atrdrvr7 wrote:
No it wasn’t. You may want to read the post again. The OP listed a track in Dallas they were trying to use for a comp...
No it wasn’t. You may want to read the post again. The OP listed a track in Dallas they were trying to use for a comp. It’s not the one for sale.
But somebody said: "If it is Rio Bravo," and the appraiser answered: "No, it's not that property. But that's helpful to understand. Thank you!"
brocster
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brocster 4/5/2019 9:05pm
4/5/2019 9:05pm
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
atrdrvr7 wrote:
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months...
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
He posted ~ 9hrs before your reply that it was Oak Hill...
atrdrvr7
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atrdrvr7 4/5/2019 9:08pm
4/5/2019 9:08pm Edited Date/Time 4/5/2019 9:16pm
michelewood wrote:
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation...
I'm hesitant to identify it specifically as I don't want to break confidentiality agreements, etc. It is in the Houston metro area. It's a larger operation with RV hookups, etc. Sorry about being cagey--want to make sure I'm remaining neutral and unbiased!
atrdrvr7 wrote:
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months...
It has to be Rio Bravo. Only facility where it makes sense. Danny's health hasn't been the greatest and the track has been closed for months. It's also the only track inside the actual Houston metro area.
brocster wrote:
He posted ~ 9hrs before your reply that it was Oak Hill...
Oak Hill is not in Houston!!! They listed Oak Hill as a comp to figure out how to price the property their selling in Houston. Reading comprehension anyone. Phuuuck
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