Cypress Pond Plantation is one of the most diverse of the SW Georgia plantations. It offers habitat from pecan groves, classic pine woods, lakes, creeks, oak hammocks, hardwood bottoms, and fertile agricultural soils. This unique trait sets this plantation above most in the region and it was then further developed into a showplace by the late Gerald Lawhorn. Gerald is best known as a philanthropist and founder of PetroSouth. He was the inventor of the electronic gas payment system that we all conveniently enjoy today. As such, he was one of the most successful businessmen in the Southeast. Cypress Pond was his pride and joy and as evidenced today, no amount of money was left unspent if Gerald thought it would benefit Cypress Pond. Financially speaking, there is no evidence of any limits ever being placed on the quality of the improvements that he made to the plantation. The result is one of the finest privately held estates in the country.

There are a myriad of ways to analyze value and much can be further analyzed during the due diligence period. Whether one puts a discount on the improvements and adds that back into the land value, or starts with a price per acre, the fact remains that this is an unbelievably good buy on a world-class plantation. For our purposes now, I think this is one of the many ways of looking at the value of this asset.

Analytical Breakdown Based on Offering Price

We have been in this specialty niche for over twenty years and have found that this analysis based on asking price is one of the most reliable ways of initially determining a bench mark value. In today's changing market, we begin by analyzing the basics and then isolate the moving parts.

  1. Improved Uplands- This land can continue to be used as quail and longleaf timber production or converted into more intensive agricultural uses if annual operating costs are a factor. The majority of this type of property was formerly a pecan grove and includes a pivot as well as plantation woods. Recent comparable sales are being offered between $4,500 to $3,500 per acre. There are approximately 710 +/- acres that were formerly cultivated and could be converted. Incidentally, sales for farmland are much higher suggesting that the "higher and better use" may be returning this fertile section into farmland again. The point is that the “higher and better use” may not be recreational quail hunting but, in fact, conversion back to agriculture. In our opinion, due to the location on the boulevard, soil quality, topography, extensive quail habitat and current land uses as a very good high quality recreational property this area should be valued no lower than $2,800 per acre but $3,200 per acre would be more accurate for Albany. Were this in the same location in Thomasville the base would be in the $5,000 to $7,000 per acre range. For the sake of being conservative, in this analysis this would average $3,000 per acre or $2,130,000 for this component.
  2. Hardwoods and Oak Hammocks- This area includes Native American sites and a multitude of unique habitats that are rare to have all on one property in this area of Georgia. This natural area contains approximately 800 +/- acres. When breaking out the "dirt" value and "timber" value of this type of land a figure of $500 to $800 per acre for the "dirt" is considered "wholesale." In addition, the latest timber cruise of merchantable timber from March 2006 shows approximately $880,000 ($1,100+/- per acre) which is mostly in this area. We have not broken the timber valuation down for growth, changes in market conditions, etc. Therefore, this area should be valued at approximately $1,800 per acre.
  3. Improvements- Financially speaking, there is no evidence of any limits ever being placed on the quality of the improvements made to the plantation.  Some may undoubtedly not do the same things, as it may cost conservatively $4,000,000 - $4,500,000 in cost replacement valuation of the improvements, but in this buyer’s market the price is at an extreme discount far below the cost to reconstruct. Our understanding is that Gerald spent approximately $3M in restoring and adding to the antebellum mansion alone. The house was restored to display one of the largest collections of privately held museum quality antebellum antiques outside of Louisiana. In addition, at Cypress Pond, there is a very high dose of "wife appeal" that is frequently left out of many of the plantations that we see. These improvements are the type of improvements that most of our buyers would build for themselves if they had the budget or had the time and talent. The plantation has a classic yet timeless feel to it.
    1. Completely Restored 7,300 sq ft Antebellum Mansion plus an additional 3,000 sq ft in porches
    2. Old Guest House-2,300 sq ft w/porches
    3. Pond House-2,300 sq ft
    4. Bunk House-2,300 sq ft w/porches
    5. Guest Pond Cottage-576 sq ft
    6. Aunt Mamie's House-1,500 sq ft w/porches
    7. Office-1,000 sq ft
    8. Shop #1 -2,000 sq ft
    9. Shop #2 -4,100 sq ft
    10. Equipment Barn #1 -4,000 sq ft
    11. Equipment Barn #2 -8,750 sq ft
    12. Kennel 12 runs (15x5)
    13. Docks (3) -6,000 sq ft
    14. Pivot
    15. Various Wells, Including One 12" on Cypress Pond
    16. Lighted Skeet Range
  4. Water Resources- The 85 +/- acre lake itself is superior to most natural lakes and is even rarer than a man made lake.  It is an extremely unique natural lake for Southwest Georgia. It has a natural "flow through" that allows the lake to be "topped off" and the healthy addition of flowing water and a large drainage area. The plantation owns all of the surrounding lands and there is no public access to the lake.  Typically, when analyzing lake values, $12,000 per surface acre is a commonly used valuation in this region. However, Cypress Pond itself is superior to most lakes. In addition, there is a 12" well to ensure a bountiful water supply even during the driest times of the year. Using a common valuation for an average lake would equate to $1,020,000 based on 85 acres. Based on the recent sale we made of Honey Lake that had an 80 +/- acre lake this figure is very conservative. In addition, there are several other ponds on this plantation including a 31 +/- acre duck pond! Regardless, an extremely conservative evaluation would place this lake at $960,000+.
  5. Intrinsic Value- This is the uniqueness value and value of having all of this property already assembled and already fully operational. This also includes historical value and other values difficult to measure. In specializing in this type of property for approximately twenty years, we have realized that this value oftentimes represents 15% to 20% of additional value for these very select and rare high quality properties. This amount should be added to the overall price.

Key Values for an Investment Grade Property:

Through our years of experience and changes in the market, our firm has established six criteria that sophisticated buyers use to value high quality land.

  1. Investment Grade Property: The importance of buying right has never been as important as it is today. We expect properties to trade at least 15% to 30% below the peak or have incredible HBU potential. Cypress Pond excels in both categories. Cypress Pond was originally listed for $21,000,000. There is no doubt that it was not yet worth that even at the peak. Regardless, the asking price is now approximately 67% below that. Another way to look at it is that the difference in the asking price before would buy three Cypress Pond's at our listing price now. The point is that whatever it was worth there is an enormous discount now. The seller's objective is to price Cypress Pond so low that it is a financial certainty that nothing in the market is going to sell until Cypress Pond does.
  2. Location; Near Other Plantations, and "Higher and Better Use": It is triangulated between Albany and two key plantations to the south, Nilo and Nonami (which was purchased on January 20, 2010 by Ted Turner). It is strategically located near other large plantations, yet it has the convenience of restaurants, shopping, and the airport in Albany. Cypress Pond has an exceptional "higher and better use" potential. The plantation is strategically located less than five minutes from the Albany airport.
  3. Sustainable Timber Resources: According to the latest cruise, 50% of the property contains over $880,000 ($1,100 per acre) in Timber Alone! The other half could be used for agriculture or quail and most of it is in young longleaf.
  4. Water Resources; Lakes and Duck Ponds: There are many water resources to enjoy at Cypress Pond, including a 31 +/- acre duck pond, a second pond, and featuring its namesake the 85 +/- acre Cypress Pond. The cost to duplicate the main lake and duck pond is much higher than our $960,000 valuation. Appraisers commonly adjust $12,000 per surface acre. This would be over $1M.
  5. Charitable Easement Donation Ability: These benefits include tax deductions of up to 50% of annual adjusted gross basis, making it one of the most significant tax planning strategies most high net worth individuals can utilize while at the same time preserving the environment and a historical property. Please see your CPA for more information.
  6. Improvements: Financially speaking, there is no evidence of any limits ever being placed on the quality of the improvements he made to the plantation. Cypress Pond's improvements include: a completely restored 7,300 sq ft Antebellum Home, Pond House, Guest House, Guest Pond Cottage, Aunt Mamie's House, and Bunk House. All are exceptional. Additional improvements include an Office, Shops, Equipment barns, Kennel, Skeet Range, Boat Docks, and Irrigation Pivot. The cost estimates of duplicating these improvements are conservatively estimated at $4,000,000 - $4,500,000.

Jon Kohler
850-508-2999
jon@jonkohler.com