Kachemak Bay Ranchos

Homer

1972

The Kachemak Bay Ranchos project was a 1,200 acre subdivision development of large 10-40 acre residential lots with nice views of Kachemak Bay in Homer, Alaska.

The project was located outside of Homer, Alaska on Kachemak Bay on the southwest side of the Kenai Peninsula. I had never seen the property but the opportunity called for a quick decision so I bought it after looking at a few pictures and a topographical map. We divided the property into large lots 10, 20 and 40 acres taking careful consideration of the topography to ensure that each parcel had nice views. We staked the lots and made provisions for future roads and access easements, but we did not put in roads for this project. Instead we cut paths large enough for easy walking to each parcel and/or accessing with a four wheel drive jeep. This allowed us to sell each of the large parcels with a nice view and a very reasonable price to our target outdoorsy buyers who didn’t need fully built roads.

Investment Thesis

The project was specifically targeted to people who liked Homer but could not afford the current prices and wanted to buy larger than average lots as an investment for the future.

Lessons Learned

Thoughtfully matching your product to a specific target audience can save both you and your customer money without sacrificing profits. In most subdivision developments building out roads is assumed to be a necessary expense. In this case, the lack of fully built roads to each parcel did not impact sales because the target audience wanted private large acreage lots for hunting, fishing, general privacy, and future value appreciation.