Commercial Real Estate and Mortgage In North Dakota
Article Summary: This article will help anyone looking for information pertaining to a commercial real estate and commercial lending in the State of North Dakota.
The majority of the commercial real estate in North Dakota
is dedicated to agriculture. Eight-nine percent of the land in North Dakota
is farmland, making it one of the largest farm states in the nation.
The population of the North Dakota has steadily decreased since the 1980's.
Young, educated professionals looking for jobs away from the farms of this northwest
state have emigrated to other areas of the country. How to keep these young,
educated professionals has become a hot political topic in the state. The majority
of the population that has chose to stay has shifted from the rural areas of
the state to the larger cities. Cities like the Fargo, Grand Forks, Minot and
the capital of Bismarck are attracting the professionals who are not leaving
the state. Besides native North Dakotans, a small number of people are looking
to North Dakotas cities as a way to have an affordable, small town lifestyle.
There may be small-scale residential and retail opportunities here as the urbanized
populations slowly creep up in number, and this market is probably best for
investors who also intend on living in North Dakota.
Another use for agricultural land, particularly in south central
North Dakota is recreational. Game hunters and preservationists are snatching
up the land, hoping to return to its wild nature. Indeed, these buyers have
driven up the price of agricultural land from about $400 per acre a few back
to about $700 per acre today.
Aside from agriculture, North Dakota's economy depends heavily on small-scale
retail. Smaller national restaurant chains are slowly moving into North
Dakota's major cities such as Bismarck and Minot. Accordingly, the retail market
is growing, though it remains miniscule compared to investment opportunities
in other states. Particularly, the concern over the size and reliability of
the labor pool hinders retail growth, and this is likely a drain on the retail
property market as well.
Another issue for developers of raw land in North Dakota is that they may be
competing with municipalities. Hurting for tax revenue, some local governments
are turning to land developing as a way to raise to funds. Counties developing
their own land are doing everything from developing retail pads, to simply dividing
property and selling off lots.
The residential market in Bismarck and Fargo remains strong, but it's
not suited for investment. There is no significant new construction, nor is
there any demand for it. Rental vacancies and rents have remained steady. Fluctuation
is what creates opportunities in a market, and, unfortunately, the only fluctuation
in North Dakota's real estate market comes from declining population.
What does this mean for those who are interested in commercial real estate
in North Dakota?
Those who are interested in investing in farmland certainly have plenty to
choose from. As farmers retire and their children choose not to continue in
their parent's business, the land is being sold off. Since the areas outside
of the cities are not experiencing any kind of population or financial growth,
the land is best used as farmland.
The soil in North Dakota is ideal for several crops such as
wheat, barley, sunflower, soybeans and flax as well as vegetables such as beats
and corn. The state is the leading producer in the country of many of these
crops. The land in the southwest corner of the state is ideal for cattle and
dairy farming.
Around the larger cities there are some industrial commercial businesses such
as food processing and electric power industries. Commercial real estate for
these businesses is available for those looking to expand those industries.
Many of the residents who live and work in and around the larger cities own
or rent second homes around many of North Dakota's beautiful lakes. These
areas also bring in tourists form other parts of the country. Commercial real
estate is available to develop for tourism in these areas. The state is actively
working to attract tourists and is promoting their tourist industry.
North Dakota is a state that is looking to find ways to keep its population
from dwindling and bring in commercial business. Because of this, the government
is consistently devising new programs to attract businesses and employers to
the state. This means that they are willing to work with businesses who want
to buy and develop commercial real estate in the form of tax breaks and other
major incentives to bring in and keep commercial business. The commercial real
estate is there waiting for innovative and creative businesses to purchase it
for a very reasonable rate.
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