White Pine - The Sustainable Real Estate Journal

Sustainable Design Principles and Innovation,
Merging Building Technology with the Forces of Nature

New Housing Developments Incorporating Local Food Production

by Don Kulak

Real estate development and food production are not usually discussed as mutually inclusive enterprises. Each has its own unique place in our highly-segmented society with virtually no crossover opportunities exploited. This narrow thinking leaves a lot of opportunities and benefits on the table. Its like a merger in business, where two or more companies have unique areas of specialization that can complement each other, thus creating new entities with expanded marketing/production capabilities and financial leverage. The whole is greater than the sum of the parts, as they say.

In this example we will be merging real estate development with food production, two totally separate industries whose end users require both housing and food. Incorporating food production (small farms) into real estate development models brings a multitude of benefits and opportunities, with regard to finance, health, and overall quality of life. It’s maximizing ALL available assets to create more synergy and leverage. This creates added value to the development in a number of ways: 

  • Local food production is, for the most part, healthier, fresher, more convenient, and less expensive than supermarket food.
  • It eliminates logistical problems of long food transport and its added costs.
  • People are more concerned about the origins of their food and how it is produced. This assures residents of high-quality food.
  • Small farms within the community create a more wide-open, less congested feel for residents, thus adding better views, more property value and ultimate demand.
  • Food production can create additional revenue streams for the community if sold to local restaurants, farmers markets, etc.
  • The fertile farm areas absorb massive amounts of stormwater, thus minimizing the chances of flooding, and reducing the strain on already overtaxed sewer systems. It also reduces the need for the number of sewer lines found in conventional developments, which considerable reduces infrastructure costs.

The benefits go on and on, but this concept is nowhere to be found in mainstream real estate development. Why? Because the construction industry is extremely slow to adapt to necessary changes, therefore leaving massive opportunities and benefits untapped. Hopefully you, our readers, will recognize the advantages of different land use designs, and profit from their implementation.

Getting back to our example, the designated farm areas will show a return on investment in the form of food sales, open space, and better views. Depending upon the situation the bottom-line returns from the farm land may be increased through different acquisition methods. That is to say, rather than paying for this additional land up front, it could possibly be leased, thus freeing up additional equity for other purposes. Or, a non-profit land trust can be formed, whereby the land is paid for by tax-deductible donations from people supporting environmental stewardship, local economies, health, and sustainability. The land trust can also be used to buy up more land in other areas for similar developments.

A separate land acquisition company can also be structured as a for profit business. Income can be generated by leasing the farm land areas to developers. It can be structured as a straight lease for X number of years, or it may include an option to buy

Farm Management
Let’s face it, builders are not farmers, nor do they really want to be. The residents may know a little about farming, but probably not nearly enough to prepare the soil, plant, maintain crops, and harvest, etc. That said, there is an opportunity for the landowner, whether it is the land trust, the builder, an individual, or the community as a whole, to put a farm management team into place. This is an important step as a good creative management team can make the farm areas into profitable ventures in and of themselves.

All it really takes is one person who know the ins and outs of farming. He can then hire workers from the community, or nearby, to work the farm while learning the food production business.  Everyone wins.

Food production doesn’t have to be limited to designated farm areas. Food can be grown in fronts or backs of homes or offices in lieu of grass. People just have to expand their perceptions of what looks good, or not. Why is a symmetrically manicured lawn more acceptable than vegetable or fruit plants and trees? Isn’t beauty in the eye of the beholder? Is healthy food more important than a toxic, high maintenance lawn, or not? Who decided that lawns were to be the only accepted norm in new subdivisions? These are questions one needs to ask, or better yet, builders need to ask when planning a new development.
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Builders are subject to stringent environmental impact regulations, especially these days. Stormwater mitigation is usually high on the enforcement list of local municipalities, as flooding and pollution runoff can have a devasting effect on a community.

In order to meet stormwater requirements, builders have to first apply for a grading permit. To do so, the builders must submit a detailed topographical map indicating potential stormwater flow volume, directions, and retention areas for overflow. The area must be graded so the stormwater flows to areas that can absorb or retain excess water while not damaging buildings or roads, etc. This is a long, expensive process, as excavation and grading require additional heavy equipment and skilled operators.

That said, adding farm areas to a development will not only generate revenue (food sales, higher property values…), but will also absorb significant amounts of stormwater, due in part to the high organic composition of the soil. In fact, adding just 1% more organic material to soil will increase the water absorption capabilities from anywhere between 2,000 and 12,000 gallons per acre.  This was detailed in our recent interview with the Soil Rennaisance Project.

Since adding farmland to a development significantly increases the stormwater absorption capabilities, less excavation is required for retention ponds, swales, and grading. That is a significant savings for the developer. And, in order to make it more efficient, constructed wetlands could be added in and around the farm for more irrigation capabilities and less municipal water usage. The benefits are many, only some of which are explained here.