How Does LandEx Manage Risk?

LandEx is the first land investment marketplace that allows easy-to-access, diversified, and transparent land investments. LandEx will…

Photo by Loic Leray

LandEx is the first land investment marketplace that allows easy-to-access, diversified, and transparent land investments. LandEx will unlock the true value of land by democratizing access to land investments.

In this article, we want to detail how the company manages the risk associated with land and land investment.

Assessing Risks

LandEx only operates in countries where we have an understanding of land investing risks through partnering with local land management firms and trustworthy data to build predictive analytics.

All lands go through a thorough vetting process where we eliminate dubious, risky, and negative/low estimated return lands.

Checks

Find below a series of checks we make when vetting the land.

• If there is a risk that the seller cannot sell us the land.

• If the legal ecosystem and land title ownership are insecure and not transparent.

• If there are any unknown liabilities on the offering.

• If the seller cannot be trusted (credit checks, AML/KYC).

Climate/Weather

• Is there a non-resolved drainage issue?

• Does the farm lack access to water for necessary irrigation purposes?

• Is the crop species suitable?

Regulatory

• Is there a risk that the government changes the land use (e.g. turn the land into a natural protection area)?

• Is there direct access to a maintained roadway?

• Is land-use change allowed? (positive)

• Development potential: location close to current or future metropolitan centers or location close to nature scenery for holiday homes? (positive)

Financial Plan

• Are there non-farming/forestry assets valued as part of the transaction (energy, hunting, other)?

• Was there a market value drop of more than 10% in the region over the last 10 years?

• Is there a lack of data on historic productivity?

• Does the land have stable cash flow potential (tenant or tenant interest)?

• Is the financial condition of the renter stable?

The content LandEx’s blog is for informational purposes only, you should not construe any such information or other material as investment, financial, or other advice. Nothing contained on the LandEx Medium blog constitutes a solicitation, recommendation, endorsement, or offer by LandEx or any third party service provider to buy or sell any financial instruments in this or in any other jurisdiction in which such solicitation or offer would be unlawful under the securities laws of such jurisdiction.