Managing for Profit

The flexible cash rent option

Farmers are looking at ways to cut inputs and for those that rent land – lowering cash rents is one option.  The president of a farm real estate management company says there might be an option where both the tenant and the landowner can see a benefit.

Howard Halderman with Indiana based Halderman Real Estate and Farm Management Services says his company utilizes what he calls a cash flex lease option.  It reduces the risk for the tenant by lowering the base cash rent 15 to 20 percent up front but then provides upside potential for the landowner by adding a bonus if profits exceed a previously determined benchmark.

He says this option is increasing in popularity.