The Equine and Wines Solution
In total, the property encompasses roughly 22,000 acres. 7,700 of those acres are deeded and 14,000+ are leased from the state. There is currently only one home on this entire estate. The intermediate ground (not considered in this plan) is also good for agricultural profits in pecans, avocados, agave, alfalfa, grass and other products that will bring additional buyers.
There is an enormous equestrian market in nearby Tucson, Phoenix and Scottsdale areas that hate the extremely hot weather during the summer months. They are natural buyers for our equestrian lots. Our climate has a 14 degree cooler temperature during those months.
The property contains all three;
1) expensive vineyard quality land,
2) surrounded by inexpensive equestrian type land that is perfect for equestrian lifestyle living
3) 14,000 acres of state owned land with beautiful protected views, for life.
There are no water supply problems or restrictions in Cochise County, AZ. Most people aren’t aware that the reason for Tombstone’s decline in silver mining during the late 1800’s was caused by repeatedly hitting water at just 20 feet deep.
The launching of new vineyards relies on tourism to bring people to the vineyard for wine tasting/purchasing. Tombstone is across the street and serves over 2,000 tourists per day, on average. In addition, Arizona is already gaining recognition for wine travel.
Most Americans are not aware that the United States Agricultural Department provides incentive start up loans with very low interest rates. If a U.S. citizen has never farmed for a living before, (horse training is not considered farming) and is turned down by a bank for an agricultural loan, they then qualify for a government loan. Any U.S. citizen can obtain a 1.5% interest, 40 year start-up loan of $300,000.00 to purchase property and an additional $300,000.00 for planting and cash flow needs, with no money down. Those needs can include the purchase of trucks, tractors and equipment. If they have 5% to put down, those loans can exceed $1.2M dollars. The reason that these loans are not claimed is because they require “experience” to get approval. That is a catch that works to our Company’s advantage. In our plan, buyers may get approved if they hire us, an outside crop management company. Equine and Wine’s corporation (first of three), “Silver Thread Vineyard Management”, will be that Company. Having the ability to provide buyers with the Management Company that gets them approved and showing buyers how to finance the start-up of their privately owned vineyard will boost our property sales, while increasing the value of our vineyard farming and winery companies.
Our lot size, and the size of these loans, seems to perfectly match. It costs approximately $30,000.00 per acre, total cost, until harvest. If a buyer buys 10 acres from us for $300,000.00, plants it (for $300,000.00 using U.S. Ag. loan money at 1.5%) the USDA loan amount covered them until harvest. The return, assuming an average price of $30.00 a bottle, is greater than $300,000.00 annually. That return will be divided with Equine and Wines. If it produces premium quality wine, the return could be much more. That formula represents their retirement. The new value of their little vineyard will be 10x annual earnings, or more. Getting 10x earnings for a horse farm is something that currently doesn’t exist in the equine industry, because when a trainer leaves a property and takes his horses, the business has no value other than what is left of the facilities and home.