The Marlborough Sounds are an extensive waterway in the northern part of the South Island of New Zealand. The fractal shores in fact comprise one-fifth of the length of New Zealand’s coastline. With unpolluted waters, an abundance of nutrients, and shelter from the open sea, these sounds provide the perfect environment for shellfish to grow. (See Figure 18.4.) The waterways are highly regulated. Limited numbers of licenses are granted, as overharvesting would be detrimental to the entire industry. Consequently, licenses have considerable value even before a crop is harvested.

My farms grow oysters and mussels. The spat is seeded on lines that hang vertically in the water from floating racks. Depending on water temperature, nutrients, and a number of other factors, the shellfish may be harvested anytime from around 7 months to 18 months. Once harvested, the crops are sold on the open market either for local consumption or, more typically, to be airfreighted to Asia or America. As such, prices are global, being affected by world supply and exchange rates.

Always be willing to expand your concept of commercial real estate to include anything where commerce is conducted within geographically defined spaces, be it on land, in the air, at sea, or, dare I say it, out in space.

One of the great things about the United States is that the owner of a piece of land owns whatever is underneath it. Thus, if you strike oil in your backyard, it is yours to sell, lease, borrow, or develop. Conversely, if you sell the land, then the new owner has the rights to any minerals.

In fact, only in the United States do private investors own a patch of property all the way to the center of the earth and into the sky. In this sense, real estate truly is the basis of all wealth. It includes everything on the land (buildings and structures), over the land (air rights), and under the land (minerals, oil, gas, water, thermal energy, etc.).

In Texas and Oklahoma, things get even better. In these two states, the ownership of the land and the ownership of the minerals can be separated. In other words, you can buy a piece of land, split off the minerals, sell the land without the minerals, and then go about mining the minerals, even though you no longer own the land. And in Texas, mineral rights are perpetual. These rights are the icing on the cake.

Baen has shaped mineral rights into an art form, and the icing on the cake (the mineral potential) has become the cake. The cost of drilling an exploratory well to see if there is any oil or gas can be enormous—millions of dollars. However, oil companies are willing to do this free of charge to you and give you a small percentage (12 to 25 percent royalty) of the output of the well should it be productive, in return for you giving them the contract to drill on your mineral rights, even if it is no longer your land.

Baen sits on many oil and mineral rights all over Texas. Some still need to be drilled to see if the wells will be productive. Some have been drilled and turned out to be dry (although new technology introduced by oil companies in the past five years ensures that some 90 percent of wells drilled these days are productive).

And others are quietly producing oil or gas with no overheads to Baen—no leaking roofs, tenant complaints, or other challenges associated with conventional commercial real estate investment.

I, too, have become an oil man, and while my income from this operation may not be spectacular, I get a certain satisfaction knowing that my share of oil that is pumped out of the ground is far greater than the oil I consume in vehicles.

1. Loan Term – The loan term is the repayment time of your loan. In most cases mortgages are 30 years, but some of them may be 10 or 15 years. The longer the term the lower your monthly payment, but at the same time you are paying the higher interest!
2. Interest Rate – A fixed interest rate indicates that you will be offered the same interest rate for your entire loan period. An adjustable interest rate may change after a period of time. If you are comparing a fixed rate and an ARM loan, use a mortgage calculator to compare your payments down the line as well as those up front.
3. Closing Costs – Lenders, closing agents and attorneys, state regulations should be taken into account when calculating closing costs. Choose the lender with the smallest amount of junk fees or the one that will cover your closing costs out of his own revenues.

1. If you look for mortgage quotes from a well-known lender, your information is absolutely safe. You do not have to go to every Tom, Dick and Harry on the web to find good mortgage opportunities – stay with the brands you know you can trust. Their online security will be state of the art and you will get much better home mortgage information by shopping around.
2. Quick Processing – Online mortgage institutions are not restricted by the same home loan procedures as large local banks. They have turned loan processing automation into an art form, therefore they are able to take you from application to closing in virtually no time.
3. Low Rates – Online mortgage companies and home loan specialists have access to such a variety of lenders and rates that they will most likely find a program that is suitable for every client’s needs.