EASI team members have completed over sixty projects across the US, including Alaska and Hawaii. These projects represent a combination of outright conservation (preservation), ecological restoration, ecological asset valuation and eco-asset appraisals drawing on the skills of MAI-certified appraisers.
It was therefore time to update its ‘Landowner Deck’ presenting a dozen case studies of eco-asset value through December, 2024.
The case studies offer real world assessments of ecological asset value on farms, ranches and mines in Alaska, California, Florida, South Carolina, Oregon, Washington and West Virginia. The stories underscore the importance of gathering and applying current price data for eco-assets, usually given as the sale price of wetland and conversation mitigation credits within a specified geographic area. Eco-asset values represent an alternative to outdated ‘Yellow Book’ methods. This is confirmed by several case studies where MAI results have exceeded Yellow Book values.
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Case Study Lessons:
Lesson 1 – Mitigation credits are bona fide indicators of land value and important sources of business revenue.
Lesson 2 – The market value of mitigation credits can support property debt financing.
Lesson 3 – Developing a mitigation bank can be costly and isn’t always necessary. Knowing a property’s potential eco-asset value—like knowing the value of undeveloped natural resources—can be enough to boost land sale prices.
Lesson 4 – The gift value of land, and number of tax credits earned, can increase once eco-asset values are included. This is also true when figuring estate values.
Lesson 5 – Attractive ROI is not always the determining factor in project decision making.
Lesson 6 – Mitigation credits don’t always generate high ROI; mitigation bank development options should be carefully studied.
Lesson 7 – Some mitigation credit markets may be saturated, reducing the incentive to build new mitigation banks till mit-credit absorption rates improve.
Lesson 8 – Hard eco-asset market value is not everything. ‘Soft’ EAV can build willingness-to-pay for an attractive property, especially if advocated by reputable sources.
Lesson 9 – It’s not all about mitigation bank size and diversity. Development costs and market conditions are critical determinants of project success for large and small projects.
Lesson 10 – Knowledgeable buyers will underbid eco-asset rich properties knowing they can be ‘flipped’ via mitigation bank development and credit sales.
Lesson 11 – Outdated Yellow Book values are being replaced by eco-asset datasets and valuation methods, leading to a more holistic understanding of market value for rural lands.
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For more information about eco-asset values on your rural property, send a note to info@easillc.com, or call 415-706-6154.