ASFMRA: Find "The Balance" In Farm Management and Real Estate Services

Howard Halderman is President of Halderman Farm Management & Real Estate Services, and the Executive Chair of U.S. Agriculture. He recently earned the ASFMRA’s 2019 H.E. “Buck” Stalcup Excellence in Education Award for management education. ( ASFMRA )

---Commentary provided by Howard Halderman---

For decades, farm management companies across the United States have also served as real estate brokers. Our firm started offering real estate brokerage services all the way back in the 1950’s. Today, the largest farm management companies have very significant real estate brokerage operations. How do these firms balance the workflow and focus? After all, these services compete for a staff member’s time and focus, and there exists some potential for conflict of interest.

It is important to understand why a company offers both services. The first may be a legal requirement. Across many states, the law requires someone who wants to manage farmland (real property) for a fee to hold a real estate license. This gives a farm manager the legal license to also buy and sell farmland. 

The second reason to offer both services is knowledge. The farm manager knows the farm he or she manages as well as almost anyone else. When a client thinks about selling that farm, they naturally look to their farm manager as a resource who knows the farm and the local people who might be interested in buying it.  

Additionally, farm managers, as part of their management work, need to know farmland values in their area. Outside investors look to managers when they consider farmland investment, since these managers know the values, the farms and how to manage them in order to maximize the investor’s financial objectives.

This knowledge, combined with the proper licensing, places the farm manager in arguably the best position to market and sell a client’s farm for the best price and terms.

So how does a busy farm manager – managing 50-70 farms across multiple counties/states – add real estate services to the mix?  Various firms approach this question in two main ways.

The first method is to allow each area representative to offer the services they have the passion and knowledge to execute. At Halderman, we select area reps that have the skills to manage properties as well as buy and sell. Most of our staff offer two to three services. The key to being able to balance the services is corporate office support. Firms like ours develop extensive back offices to handle the details of a real estate transaction. They have marketing departments, closing experts, auction teams, farm management administration and collateral needed to manage or market farm properties successfully. The farm manager is customer-facing, handling the local contacts while the corporate office supports their work.

The second method is a division of duties. Some firms will have those employees who solely focus on farm management and others who focus on real estate work. This allows for specialization, which can be beneficial. This method does not require as much balance of work, but communication between the two service lines and local knowledge is critical for success.

Balance in work and life can be challenging, and our industry is no different. But farm management and real estate services are complimentary, often requiring the same licensing and skills. Specialization offers some benefits, but local knowledge is so important in the farmland space. A strong back office enables these dual managers/brokers to find success for their clients. Many firms like ours do this well today. Ask about the advantages of the “balance.”

Howard Halderman is President of Halderman Farm Management & Real Estate Services, and the Executive Chair of U.S. Agriculture. He recently earned the ASFMRA’s 2019 H.E. “Buck” Stalcup Excellence in Education Award for management education.
 

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