Edition #4, December 4, 2025

Land Is Your Bank

Land Value Alpha Fund Website Now Live

We're excited to announce the launch of our new website at https://landvaluealpha.com. After 25+ years in real estate and 17 years transforming raw land into valuable assets across the American Northwest, we're now sharing our proven investment strategy with accredited investors and family offices. The site offers a comprehensive look at our approach—acquiring undervalued land with water rights in tertiary markets across Montana, Idaho, and Washington, then unlocking value through infrastructure development, water rights monetization, and natural resource optimization. No construction risk. No mining exposure. Just disciplined, operational value creation targeting 20% Net IRR and a 6.2x equity multiple over a 10-year commitment.

Whether you're considering an allocation or simply curious about why land and water rights are emerging as a compelling alternative asset class, we invite you to explore the site. You'll find detailed case studies, our risk-managed methodology, and insights into why tertiary Northwest markets offer opportunities that institutional investors overlook. For a quick introduction to our vision, watch our overview video here: https://www.youtube.com/watch?v=NsNmCmHVY8k. Questions? Reach out directly—we'd welcome the conversation.

Land is your bank. It used to be that money in the bank was "money in the bank". Meaning it was safe, no risk of loss, wouldn't devalue from inflation, whether it be federal printing presses (aka Quantitative Easing) or otherwise, backed by gold (the gold standard), more stringent banking reserve requirements, etc.; and would pay you meaningful interest. Without a history lesson, we all know the reasons that that is no longer true. Such forged the way for crypto, despite its extreme price volatility, a lack of/minimal regulation, security vulnerabilities, environmental concern to mine the coins, limited mainstream adoption (which has now become mainstream), and a steep learning curve for users. So now, money in the bank is not “money in the bank.”

There is an asset that truly IS money in the bank. Land. Land has become the ultimate bank. With land ownership, its value constantly increases. We at Land Value Alpha Fund cannot find a 10 year period in history, where the value of land has decreased. Additionally, land historically has very low volatility as well. It still does today. Inflation will generally increase the value of your land. Not decrease it. Land is not susceptible to being devalued; as we have seen the value of the dollar decrease by 20% during the last 5 years. There are no security concerns with land. Once you buy it, you have the physical deed and your property ownership is recorded in the public record with County Recorder's Office in the state where your land lies. What we don't have with raw land, with or without the benefits from infrastructure development and from water rights creation or water rights acquisition, is mainstream adoption of land as an investment asset class. Adoption is slowly changing though, as hundreds of thousands of acres throughout the Midwest and West are being acquired by well-known billionaires like Bill Gates, Jeff Bezos and others, with these purchases beginning to capture media attention, increasing exposure and translating to initial adoption of raw land as an investment asset class.

Because land is constantly appreciating, over centuries and over decades and often in 3-5 year periods as well, your "interest" if you want to call it that is your income generated from the land. Income producing examples consist of land leases, hunting leases, carbon credits that you can monetize, agricultural tax breaks, wildlife subsidies from the government, selling timber, quarrying rock that sits on your land (this is not mining), etc.. And the most valuable item you might sell on/from your land is Water. All of these activities generate income while you hold your land. So there is the potential for substantial income (call it interest). This can be substantial over the years and add an additional 2%-4% per year in yield, depending upon natural resources and type of land and how you choose to utilize your land. Such adds up over 10 years, more over longer periods.

Then there is capital appreciation. This one is the monster in terms of the magnitude of investment returns. With well purchased land (identifying undiscovered value, patience, strong negotiating, comprehensive due diligence), one can target [not a guarantee] 20% compounded annual returns. These types of returns are difficult to find via any asset class. Raw land has this potential. Potential for very high returns and low volatility and very low correlation to any other asset class. So when the stock market tanks, your land does not.

Now, using your land as a bank: A few scenarios: Scenario 1: I need some capital but I don't want to sell any of my land. Banks will loan against your land. Often up to 75% of the equity in your land. That's huge. While I personally wouldn't utilize such high leverage (nor does our Fund), it is available for land owners who choose to do so; or borrow a lower amount. Scenario 2: I don't want to borrow any money, but I need some capital. Ok. Use a method of division to sell a small part of your land (or a larger part) and retain the balance of your land. Minor or major subdivision, family transfer or boundary line adjustment are just a few of the methods of division to "calve off" some of your land for cash and keep your remaining holdings. Very few tangible assets enable you to do this without destroying the value of the asset. Land does. Scenario 3: Sell an easement (access) across your land in an area that will not disturb your current use and enjoyment of your land and provides access to someone or some entity who needs this access. Easements are sold for tens and hundreds of thousands of dollars or more. Scenario 4: If you have power on your property, you can sell access to a neighbor(s) for them to connect to your power vault which is connected to the local utility. This may/may not be an easement, depending upon the location of the utility vault. These are just a few scenarios that demonstrate that land is your bank.

David N. Baker ("DNB") is the Managing Principal of the Land Value Alpha Fund and author of the Land Value Alpha Newsletter, dedicated to uncovering investment opportunities in what he considers the world's most inefficient asset class: Land. With over 25 years of real estate experience, David has successfully invested in rural, commercial and residential land, while developing, redeveloping and operating self-storage facilities. He has led multi-million dollar infrastructure projects in Montana and Oregon, including: remote road construction, power installation, water well drilling, septic systems, pump stations, rock demolition and home site preparation. David's land investment strategy focuses on identifying undervalued land in tertiary markets, where the greatest inefficiencies exist, conducting infrastructure development, 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.

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David N. Baker

Investment Disclaimer

Important Legal Notice: This newsletter and all content contained herein is provided for educational and informational purposes only and represents general observations, analysis, and commentary about land as an asset class, including market trends, historical performance data, general characteristics of various land investment types, educational content about land ownership and development, and industry news and market commentary. The information presented is NOT intended to be, nor should it be construed as, investment advice, financial advice, or a recommendation to buy, sell, or hold any specific investment or security, and nothing in this newsletter should be interpreted as a recommendation to purchase, sell, or hold any specific property or investment, a solicitation to invest in any particular asset, fund, or investment vehicle, an endorsement of any specific investment strategy, a guarantee of investment performance or returns, or tax, legal, or accounting advice. The author and publisher of this newsletter are NOT registered investment advisors, are NOT providing personalized investment advice, do NOT offer investment advisory services, have NOT established an investment advisory relationship with readers, and are NOT acting as fiduciaries with respect to any investment decisions. Before making any investment decisions, readers should consult with qualified, licensed investment professionals, seek advice from registered investment advisors or financial planners, obtain independent legal and tax counsel, conduct their own due diligence and research, and consider their individual financial situation, risk tolerance, and investment objectives. The information provided in this newsletter is provided "as is" without warranties of any kind, may contain errors, omissions, or inaccuracies, is subject to change without notice, should not be relied upon as the sole basis for investment decisions, and does not guarantee any particular outcome or result. All investments, including land investments, involve risk of loss, past performance does not guarantee future results, and land investments may be subject to various risks including but not limited to market volatility and economic downturns, liquidity constraints and difficulty selling, zoning and regulatory changes, environmental and natural disaster risks, tax law changes, and interest rate fluctuations. Readers are solely responsible for their investment decisions and consequences, conducting independent research and due diligence, understanding the risks involved in any investment, complying with applicable laws and regulations, and seeking appropriate professional advice. Any projections, forecasts, or forward- looking statements contained in this newsletter are based on current expectations and assumptions that may prove to be incorrect, and actual results may differ materially from those projected. To the fullest extent permitted by law, the author and publisher disclaim all liability for any direct, indirect, incidental, or consequential damages arising from the use of or reliance on any information contained in this newsletter. By reading this newsletter, you acknowledge that you have read, understood, and agree to this disclaimer and that you will not rely solely on this content for investment decisions without seeking appropriate professional advice. This disclaimer is subject to change at any time without notice.

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