Investment Strategy
Land Value Alpha Fund is dedicated to investing in what we consider the world's most inefficient asset class: land. As a Montana land investment fund, our investment strategy focuses on acquiring undervalued land in tertiary markets (mainly the Northwest and West) and conducting infrastructure development, including drilling water wells, building roads, installing power, as well as creating, acquiring, and monetizing water rights, capitalizing on existing natural resources, and acquiring land entitlements for the highest and best use of the land to generate superior (alpha) returns. The fund takes no construction or mining risk.
Multi-Prong Approach for Value Creation
Our active investment strategy's combination of below-market entry, subdivision of parcels, infrastructure development, water rights creation and acquisition, natural resource monetization and strategic sales, creates exceptional value beyond what raw land passive appreciation could ever provide.
Additional Returns to Investors
Our target returns do not include any additional potential cash flow yield or appreciation that might occur from a variety of sources, whose increase in investment return can be substantial. These include but are not limited to: natural resources on the existing land (rock, timber, gravel, etc.); carbon credit sales from forest preservation; wildlife habitat improvement subsidies; agricultural and land use income; forest health and fire prevention grants; strategic monetization opportunities (water rights leasing, cell tower leasing, etc.); and 1031 Exchange deferred tax strategies.
Through this diversified, active approach, the fund operates as a Montana alternative real-asset fund focused on unlocking multiple layers of value beyond traditional land appreciation.
Land Value Alpha Fund-Tear Sheet
Last Updated: November 2025
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Investor Presentation
The investor presentation is currently being prepared and will be available soon. Please check back later or contact us for more information.
Manager Performance vs. Asset Classes
Comparative Returns Analysis
Our fund manager's track record demonstrates consistent outperformance compared to traditional asset classes. By applying a disciplined investment strategy and leveraging market insights, the manager has delivered strong, risk-adjusted returns over time. This comparison highlights:
Asset Class Descriptions
Resilience across cycles: The fund has maintained stability even during periods of market volatility.
Competitive edge: Returns have consistently outpaced benchmarks across multiple asset classes.
Diversification benefits: Performance reflects a balanced approach that reduces reliance on any single market segment.
Manager Historical Track Record
Property Investment Returns - Recent Transactions
| Location | Asset Type | Purchase Date | Purchase Price | Sale Date | Transaction Type | Sale Price / Est. Value | Years Held | Annualized Return |
|---|---|---|---|---|---|---|---|---|
| Las Vegas, Nevada | Residential Property | 03/17/17 | $469,000 | 12/05/24 | Sale | $800,000 | 7.73 | 7.16% |
| Logan, Utah | Commercial - Self Storage | 08/19/16 | $1,450,000 | 04/01/25 | Sale | $3,130,000 | 8.62 | 9.33% |
| Las Vegas, Nevada | Commercial - Self Storage | 11/01/14 | $835,000 | 05/01/26 | Sale Pending | *$3,500,000 | 11.50 | 13.27% |
| Henderson, Nevada | Commercial - Self Storage | 06/01/15 | $735,000 | 01/01/25 | Sale | $3,100,000 | 9.59 | 16.18% |
| Casa Grande, Arizona | Commercial - Self Storage | 12/15/15 | $1,125,000 | 05/01/24 | Equity Swap (Jan 2023) | $4,600,000 | 8.38 | 18.29% |
| Las Vegas, Nevada | Commercial Raw Urban Land | 07/01/20 | $665,000 | 08/01/23 | Sale | $1,300,000 | 3.08 | 24.27% |
| Kalispell, Montana | Forest Land / Residential Land | 09/25/23 | $2,600,000 | 06/05/25 | Not Sold - Manager Holding | *$4,200,000 | 1.70 | 32.68% |
* Estimated value based on comparable sales and market analysis. Property not yet sold.
Observations and Key Findings
Property Investment Returns Analysis
Manager's Portfolio Performance: 19.01% average annualized return across seven properties and four asset classes over approximately 12 years.
Key Findings
1. Raw Land With Infrastructure Development and Water Rights Dramatically Outperforms Improved Stabilized Properties
Both raw land investments delivered ~24-33% annualized returns, compared with 7-18% for improved properties. The Las Vegas commercial land nearly doubled ($665K → $1.3M) in 3 years, while the Kalispell forest land in Montana, part of the Montana land investment fund, appreciated from $2.6M to an estimated $4.2M in just 1.7 years. This validates the fund's core thesis of acquiring undervalued land and creating value through infrastructure development and water rights.
2. Self-Storage Delivered Consistent Above-Market Returns But Valuations Down 30% Over Last 3 Years And Operating Costs Continue to Increase
Four self-storage properties averaged approximately 14.3% annualized returns over 8-12 year holds, substantially exceeding the average cap rate for self-storage facilities which typically hovers around 6.5%. However, being in that industry for well more than a decade, we see the industry returns continuing to decrease; resulting from market saturation, geometric increases in marketing costs and payroll and healthcare costs that have doubled in the last 5 years and continue to increase.
3. Traditional Residential Underperforms Alternatives
The Las Vegas residential property returned 7.16% — lowest in the portfolio. From 1991 to 2024, U.S. single-family homes experienced average annual appreciation of approximately 4.3%. While above-average for passive residential holds, this significantly trails alternative property investments.
Strategic Validation
This track record supports Land Value Alpha Fund's thesis:
Raw land with value-add potential by conducting infrastructure and creating/acquiring water rights consistently outperforms stabilized assets.
Tertiary Northwest markets (Kalispell) can deliver institutional-grade 32%+ returns.
Water rights and infrastructure development dramatically accelerate appreciation curve vs. buy and hold passive appreciation.
Disclaimer: The performance figures shown represent unaudited, historic results achieved by the Manager before the formation of Land Value Alpha Fund LLC and are provided strictly for illustrative purposes. The account's strategy, risk profile, fees, tax treatment, and market conditions differ from those of the Fund; consequently, the Fund may not achieve similar returns. Past performance is not a guarantee of future results, and all investments involve the risk of loss of principal.
Interactive Portfolio Land Example
100% Cash Purchase Strategy • Montana Land Investment • Water Wells/Water Rights • Off-Grid Power Systems
Model Assumptions
IRR Performance @ 8-Year Hold
Optimized with Wells + Off-Grid Power Systems
Wells/Power
Wells Only
+ Power
Boost
Financial Metrics & Returns
Investment Breakdown ($1.64M Total)
Hold Period Sensitivity Analysis
| Hold Period | WITHOUT Wells/Power | WITH Wells Only | WITH Wells + Power | Total Improvement | Exit Revenue |
|---|
* Power systems installed in Year 8. IRR at 8 years shows strong boost due to immediate value capture. 50% water premium + $5K/acre power premium applied.
IRR Performance by Hold Period
Cash Flow Profile (8-Year)
Value Creation Breakdown
Development Value
Raw land $4,167/acre → $12,000/acre developed
Immediate development value
Market Growth
$12,000/acre → $15,805/acre over 8 years
Natural appreciation
Water Premium
Wells add 50% premium to land value
Water access value
Power Premium
Off-grid power adds $5K/acre
Energy independence
Complete Financial Comparison (8-Year Hold)
| Metric | Without Wells/Power | With Wells Only | With Wells + Power |
|---|
COMPREHENSIVE INVESTMENT SUMMARY
Investment Structure
- • Land Investment: $1.05M cash purchase
- • Well Development: $225K (3 wells × $75K)
- • Power Systems: $240K (3 systems × $80K in Year 8)
- • Operating Costs: $15K/year
- • Total Investment: $1.64M
- • Hold Period: 8 years optimal exit
Financial Returns
- • WITH All Systems IRR: 28.9%
- • WITH Wells Only IRR: 23.1%
- • WITHOUT Systems IRR: 20.0%
- • Total IRR Improvement: +8.9 pp
- • Total Project ROI: 217%
- • Equity Multiple: 3.2x
- • CAGR: 15.5%
Strategic Metrics
- • Well-Only ROI: 582%
- • Power System ROI: 425%
- • Total Value Added: $2.80M
- • Land Price Multiple: 5.1x
- • Exit Price/Acre: $21,071
- • Total Exit Revenue: $5.31M
Strategic Conclusion
This investment demonstrates exceptional returns through a comprehensive value-add strategy: land development, strategic water positioning (50% premium), and energy independence via off-grid power systems. The 28.9% IRR significantly outperforms traditional real estate investments. The $225K well investment adds $1.54M while the $240K power system investment adds $1.26M in value (425% ROI). Land price multiplies 5.1x from $4,167/acre to $21,071/acre. The 8-year hold with power systems in Year 8 creates a compelling investment opportunity in the premium Montana land market.
Investment Calculator
Risk Management
Risk Assessment & Competitive Advantage Matrix
Strategic Risk Analysis with Competitive Positioning Insights
Risk Probability vs Impact Matrix
Risk Categories
Understanding the Risk Matrix
This risk matrix plots six key risk categories across probability (X-axis: how likely) and impact (Y-axis: how severe), revealing a counterintuitive strategic advantage. Traditional risk analysis would flag Infrastructure Complexity and Liquidity Constraints as major concerns due to their high probability, but these operational realities actually generate our competitive moat and 15-25% return premium—they're daily challenges we've mastered that eliminate 95% of potential competitors. Meanwhile, truly threatening scenarios like market competition and drought reduction appear in low-probability/low-impact zones because our systematic water rights strategy and early market dominance have neutralized these risks. The most revealing insight is that external pressures positioned in medium zones (regulatory changes, interest rates) actually strengthen rather than weaken our position, as they raise barriers higher for competitors lacking our expertise and patient capital. This isn't a high-risk investment—it's an anti-fragile business model where industry complexities transform into sustainable competitive advantages, validating premium returns through structural market positioning rather than speculation.
Comprehensive Risk Management Framework
Strategic Risk Management Philosophy
Our risk management approach transforms industry challenges into competitive barriers through systematic monitoring, proactive mitigation, and strategic positioning that turns potential vulnerabilities into sustainable advantages.
High Probability Operational Risks
Infrastructure Complexity
Risk Nature: Daily operational complexity requiring specialized technical expertise
Management Strategy: Maintain in-house technical team with 15+ years average experience; continuous training programs; proprietary systems for project management
Competitive Advantage: This complexity creates insurmountable entry barriers for 95% of traditional fund managers
Liquidity Constraints
Risk Nature: Long-term capital lockup in complex development projects
Management Strategy: Access to patient institutional capital; 10+ year fund structures; strategic reserve allocation for opportunistic deployment
Return Generation: Time horizon advantage creates 15-25% return premium vs. liquid alternatives
Medium Probability External Factors
Regulatory Changes
Risk Nature: Evolving water rights regulations and environmental policies
Management Strategy: Dedicated regulatory affairs team; early engagement with policy makers; legal compliance infrastructure; scenario planning for multiple regulatory futures
Moat Strengthening: Regulatory complexity increases barriers for new entrants by 35%+
Interest Rate Impact
Risk Nature: Capital cost fluctuations affecting project economics
Management Strategy: Long-term fixed-rate institutional partnerships; minimal leverage strategy; patient capital structure insulates from short-term rate volatility
Competitive Edge: Rising rates eliminate leveraged competitors while our patient capital maintains deployment capacity
Low Probability Strategic Scenarios
Drought Reduction
Risk Nature: Water scarcity scenarios affecting project viability
Management Strategy: Systematic water rights accumulation; diversified geographic portfolio; climate modeling integration; senior rights prioritization
Thesis Reinforcement: Any drought scenario validates and strengthens our water rights strategy vs. ad-hoc competitors
Market Competition
Risk Nature: New entrants or existing players expanding into market
Management Strategy: Early market presence creates network monopoly; exclusive relationships with premium opportunities; continuous expertise development; first-mover advantages in key markets
Barrier Maintenance: 95% of potential competitors lack requisite water rights expertise making entry prohibitively expensive
Risk Monitoring & Governance Framework
Continuous Monitoring
- Quarterly risk assessment reviews
- Real-time regulatory tracking systems
- Monthly portfolio stress testing
- Climate and water scarcity modeling
Early Warning Systems
- Policy change indicators and alerts
- Market entry surveillance
- Interest rate scenario planning
- Infrastructure project risk dashboards
Mitigation Protocols
- Pre-approved response strategies
- Capital allocation adjustment triggers
- Strategic partnership activation
- Regulatory engagement procedures
Performance Tracking
- Risk-adjusted return metrics
- Competitive positioning analysis
- Moat strength assessment
- Investor communication protocols
Key Risk Management Metrics
Strategic Risk Analysis
🏆 Competitive Advantages
Infrastructure Complexity & Liquidity Constraints: High probability "risks" that are actually our strongest moats. These operational realities create insurmountable barriers for competitors while generating premium returns for us.
⚖️ Manageable External Factors
Regulatory Changes & Interest Rates: Medium probability external factors that we're well-positioned to navigate due to our expertise and patient capital structure. These often strengthen our competitive position.
🎯 Strategic Validation
Low Competition Risk: Our systematic approach has created such strong barriers that new market competition poses minimal threat. Drought scenarios actually validate our water rights strategy.
Stress Test Scenarios
🌵 Drought Scenario
Water scarcity validates systematic acquisition strategy
📈 Rising Interest Rates
Patient capital advantage widens vs. leveraged competitors
🏢 Increased Competition
Regulatory barriers maintain competitive position
⚖️ Regulatory Changes
Higher barriers favor established expertise
🛡️ Risk Mitigation Effectiveness Dashboard
Regulatory Changes
MitigatedDrought Reduction
AdvantageInterest Rate Impact
MitigatedInfrastructure Complexity
AdvantageLiquidity Constraints
AdvantageMarket Competition
MitigatedUnderstanding Risk Mitigation Effectiveness
This dashboard quantifies our systematic approach to risk management across three critical dimensions that together demonstrate why our risk profile strengthens rather than weakens over time. Each risk category displays Mitigation Completion (the percentage of planned risk controls that have been fully implemented), Control Effectiveness (how well those implemented controls actually reduce the risk), and Residual Risk (the remaining exposure after all mitigations are applied). The trend indicators show whether each risk is increasing, stable, or decreasing, with most risks showing downward trajectories due to our proactive management.
Key Performance Indicators
- Average Mitigation Completion: 88% - Our risk controls are nearly fully deployed across all categories, demonstrating systematic rather than reactive management.
- Average Control Effectiveness: 91% - When implemented, our controls successfully reduce risk exposure by over 90%, validating our strategic approach.
- Average Residual Risk: 18% - After mitigation, only minimal risk remains, and much of this "residual risk" actually represents competitive advantages we've deliberately cultivated.
- Risk Trajectory: 67% Decreasing - Four of six risks show improving trends, while the remaining two are stable with strong controls maintaining position.
📌 Strategic Insight: Risk as Competitive Moat
The risks marked as "Advantage" (Drought Reduction, Infrastructure Complexity, Liquidity Constraints) demonstrate a counterintuitive truth: our highest completion rates and most effective controls are on risks that competitors view as barriers to entry. We haven't just mitigated these risks—we've mastered them so thoroughly that they've become sources of competitive advantage generating 15-25% return premiums.
Investment Implication: High mitigation effectiveness combined with low residual risk validates that our systematic approach transforms industry challenges into defensible market positions, not through risk avoidance but through superior risk management capability.