From the desk:Corporate / Furnished Housing

There's a plant expansion 8 miles from the farmhouse I never wanted

I bought 22 acres two years ago for the land. There's a 1970s farmhouse on it, three bedrooms, sound roof, working well and septic, and I've been treating it as a teardown I haven't gotten around to.

Now there's a manufacturing expansion eight miles up the highway and the county paper says the contractor is bringing in crews on 4 to 9 month assignments starting in spring. The nearest extended stay is 34 minutes away and it's full most weeknights already.

Rough shape of it: the house needs maybe $28,000 to be genuinely rentable, mostly kitchen, one bathroom, flooring, and a panel upgrade. Furnishing it for four people sleeping there would be another $9,000 or so, and I'd want a washer and dryer that can take real abuse. Long term unfurnished around here would be $900 a month if I found anyone, and I might not.

If the crews rent it furnished with utilities at, say, $2,600 for the house, that's a different asset than the one I've been ignoring. If the project slips a year, I've put $37,000 into a building I planned to knock down.

What I don't know is how contractor housing actually gets bought. Does the general contractor lease the house, or do four guys each pay me, or does a staffing outfit sit in the middle? And who do I even call to ask, the contractor's office or somebody local. I've never sold anything to a company.

Answer

1diane_kowalskiPassivePRO9

The thing I'd want nailed down before spending the $28,000 is who the counterparty is, because it changes what you're building. A general contractor signing a lease for the house wants one invoice and a single point of contact and will accept plain finishes. Four individual guys paying you separately means four leases, four move-outs, and you're the one chasing the fourth.

On who to call, project superintendents usually handle crew logistics and they're findable once mobilization starts. The other route is whoever the county economic development office talks to, they generally know which contractors are coming and when, and they answer the phone.

The $37,000 downside doesn't scare me as much as the timing. Plant expansions slip constantly. Would the house be worth the money to you as a long hold rental at $900 if the project vanished?

2 replies

3laurenkim53Passive

Rural furnished for crews is real money and it is hard on the building. I've watched a neighbor do it with a farmhouse and the wear in eight months looked like four years of a family. Steel toe boots, gear in the living room, someone frying something at 5am. Budget the furniture as consumable, not as an asset.

Also $2,600 sounds low if you're housing four earners. Per-bed pricing is how the extended stays get there. But per bed means you're running a rooming house and that can pull in county rules on occupancy and septic capacity, which vary by state and by county, so check yours before you count the fourth bed.