Pros and Cons Investing in Billboards

Hi, this is Frank Chen with REIClub.com, the only site you need as a real estate investor. Today I've got quick video on investing in billboards.

*Note: Mention – “Click “show more” in the description below to follow along.

How to Invest in Billboards
Profit Centers
– Invest in land itself where zoning for billboards is approved
– Ground Leases – Rent land, build a sign, rent the sign – sign rent exceeds land rent resulting in cashflow
– Sub-lease an existing billboard – no advertisement – improve the sign – rent it out

– Find a location – preferably high traffic – Billboardsforsale.org
– Contact Local Zoning Department – permits
– Work with a Licensed Real Estate Agent – contact owners and make offers
– Due Diligence – Call around for rent rates, identify vacancy rates, traffic, etc…
– Negotiate and Close the Deal
– Hire Billboard Contractor
– Advertise The Billboard
– Cashflow or flip for big profits

– Expenses – financing, property tax, building the structure, insurance, utilities, occasional repairs

Pros to Billboard Investing
– Billboards have become one of the strongest media options for advertisers
– Billboards have not really been affected by the internet like newspaper, or television have
– The amount of traffic and readership passing billboards increases every day
– Technology and design have made installation easier – creates happier advertisers and more products and services that advertisers can market.
– Tax benefits – depreciation
– Double Income – Advertising Per Side
– Doesn't take very much money to get started, or even to build
– Long term commitments – contracts usually several years – sometimes with big companies like McDonalds
– No usual hassles of tenants
– Cashflow potential

– Note**:Grandfathered – existing billboards cannot be removed for digital technology or moved to new sites.

Disadvantages of Billboard Investing
– Vacancy Overhead – Property tax, insurance, utilities, etc..
– Advertising companies own tons of billboards – not for sale – only lease
– Quantity is limited for now
– Hard to find long term contracts in certain locations
– Vandalism
– Zoning Restrictions

Cost
– Bulletin (Large Billboard): Range of $1,500 – $30,000 per ad per 4 week period
– 30 Sheet Poster (Medium Billboard): Range of $750 – $2,000 per ad per 4 week period
– 8 Sheet Poster / Junior Poster (Small Billboard): Range of $300 – $750 per ad per 4 week period
– Digital Bulletin (Large Digital): Range of $3,500 – $25,000 per ad per 4 week period for an ~8 second spot in a loop of ~64 seconds

Investing in Billboards is a form of creative real estate. It doesn't take that much money to get started, and the income potential is significant. Like all investments, its important to do your research, perform all necessary due diligence, and consult with your attorney where concerns arise. As long as you follow these steps, you will be in a good position to make a safe and secure investment.