Buena Park is found in the northwest of Orange County and it is also to the northwest of the county seat, which is Santa Ana. In 2010, there were some 80,530 people who lived there, which make it a small city. Of particular interest is that it is actually located within the Los Angeles metropolitan area. Buena Park has a relatively strong tourist industry, particularly because the amusement park, Knott’s Berry Farm, including other tourist attractions, can be found there. The largest employer in the city is Knott’s Berry Farm , which has about 5,071 employees. Other top employers in Buena Park are Prologis, Leach, the Access Business Group, PepsiCo, J.C. Penney, ADP, Yamaha, the RIA Financial Services, and the City of Buena Park. Buena Park was an agricultural center when it was incorporated on January 27, 1953. Its economy. Its economy was then dependent mostly on citrus products, as well as wine and dairy. Today, however, the city has become a residential community and a commercial hub.
Buena Park Land for Sale & Lease – Should You Buy or Lease?
If you are interested in land space in Buena Park, you can either buy or lease. There are pros and cons to both alternatives so let us take a look.
For buying land, there are a number of advantages:
- You can lease out your land without having any income tax consequences, so long as you pay your income tax on the rent that you receive on the land.
- You have the opportunity to have a truly productive economic use out of the land for a longer period of time, being the owner of the land.
- You may retain a certain degree of control over how the land can be used and developed. It should be noted that there are usually zoning restrictions in place. This means that those who lease from you will not be able to redevelop your property in a way that you do not want them to.
There are also some disadvantages in buying land:
- It is possible that you, as the property owner, will lease your land out to a tenant and then allow the land to be used as security for the financing needs of the tenant. If the tenant defaults later on, the land could be foreclosed.
- You will have topay income tax at ordinary rates on any rent you receive. This can be a disadvantage, depending on your personal tax situation.
- You must ensure that the lease contract has ground control included in it, or the tenant could potentially completely redevelop the land.
- You usually cannot borrow against the equity on the land while it is leased to a third party.
Simply leasing the land has a number of benefits:
- You will have a much lower initial development costs, because you do not have to pay for a down payment.
- You can deduct all your rent payments from your state and federal income taxes.
Naturally, there are also some disadvantages to leasing the land:
- Usually, the total amount that you pay in the long term for your lease will be much higher than had you bought the property. This is not always a disadvantage, however, as it depends on whether you intend to be at the same location for a long period of time.
- You won’t have as much flexibility when it comes to developing the land that you are leasing, and this may make it more difficult to run your operations in the way you want to.
- You will probably not be able to take any equity out of your business or refinance anything due to ground lease limitations.
- A lease is classed as a “diminishing asset”, which means that, towards the end of your lease agreement, your business value will also be reduced.
Let us examine the trends and statistics in terms of prices, supply, and demand for land in Buena Park to aid in the decision whether to buy or lease.
Buena Park Land for Sale – Trends and Statistics
There is currently just one plot of land for sale in Buena Park, which is a 1.37 acre industrial land at 8402-8422 West Commonwealth Avenue that is priced at $3,100,000.
Buena Park Land for Lease – Trends and Statistics
There are currently two pieces of land for lease in Buena Park:
- 35,000 square feet of industrial land, which is a fenced laydown yard space at 7091 Thomas Street. It is priced at $2.71 per square foot per year.
- 34,848 square feet ground lease at Knott & Noritsu Avenue for a negotiable rate.
It should be pointed out that there is a big caveat with regards to land, which is that of zoning. In many cases, due to zoning, it is only possible to use a piece of land for a particular purpose. While applications for rezoning are accepted, these are rarely approved.