Soar or Sail

Riley’s Farm: the next 1-5 years

In an effort to keep all of you informed about our plans for the farm, I’m outlining our rough course of action for the near future.  I know that thousands of you care about the place as much as we do, so we feel obliged to let you in on both the planning and the solution.

The Problem

When the Covid lockdowns decimated our field trip business, we went from a $4+ million a year business to something like $1.9 million annually — but with all the pre-existing obligations of a larger business.  Around here, we just lost another well pump.  The replacement was $10,000.  Our liability and workers comp bills are enormous.  If you manage any amount of land in Oak Glen, you have to have substantial revenue to solve these problems as they come up.  We have crawled back to around $3 million a year, and we are looking for new revenue streams, but, in the meantime, we took on too much high interest, unsecured debt.

Why Take High Interest Debt?

Most sporting and theater venues collect payments well ahead of the event.  There are good reasons for doing this.  If you’re putting on a musical, you need to build sets.  A baseball game?  You need to make sure the grass on the field is green and the seats are all repaired and working.  Here, we need to have money for wardrobe, linens, food prep.  In our case, if I faced a Christmas season with 80% of our dinner theater seats pre-paid and very little cash flow, I had to put on all the programs on, or earn all of your wrath, by canceling the events, shutting down the business, and wondering — out loud — when your tickets would be refunded.  I did what I had to do to make sure the events you purchased were produced on schedule.  The farm is mutually owned by family members and — for reasons you can probably understand — there are differences of opinions about whether the land should be encumbered for improvement and operation loans.  Since land-based lending was not an option for me, I had to do what I could do quickly, which meant different forms of merchant advance lending.  It’s a ridiculously high interest rate, but it’s a testimony to our other revenue streams, that — so far — we’ve been able to pay it.

The Short Term Solution

Crowd-Lending.  We are currently offering 10% interest, over a five year term, on loans made to Riley’s Farm, paid quarterly to you via Honeycomb Credit.  Our first campaign is for $75,000 to $124,000, but they allow the campaigns to run over if there is heightened interest.  Ponder this: if we can restructure $350,000 of our highest interest debt, we can add $190,000 or more to our retained earnings.  (Pay the sharks or pay our guests?)  You can invest as little as $100 or as much as $100,000.  Honeycomb bills us, pays you, and takes care of all the reporting obligations.  The entire purpose of this first crowd-lending campaign is to restructure debt and render us profitable.

If this new invention of the digital age proves successful, we could explore new campaigns to hard-surface our parking lots, build a New England Meeting House, build overnight lodging, period craft shops, the works.  There are also crowd-equity options where you invest in company shares of new Riley’s Farm ventures.  Think “Riley’s Farm Lodging, LLC” or “Riley’s Farm 18th Century Merchant Street, Inc.”

Mid Range

We are exploring the prospect of turning all of the field trips over to a new non-profit entity, which would open a lot of new funding for the living history portion of our business.  We would be very careful to keep the property rental agreements short, to insure that all board members love American history and not weird wokeness.  This may have the effect of reducing the price of our field trips, since at least some of the bill would be contributed by wealthy Americans who want to preserve our history.

The Larger Picture

All over the country, mid-range restaurants are closing.  The super-high end, ultra-gourmet restaurants are thriving, as are the bargain fast food places.  (Have you seen the lines at In-n-Out?)  But the nice cozy place, with a little atmosphere, a theme, middle-class pricing, and a friendly server — well, those places are in trouble.  Something like 45% of America’s restaurants run a loss every year.  Las Vegas and many Southern California beach hotels have decided the middle class just isn’t worth it.  They would rather have the hotel filled 40% with the ultra-rich, at scorching room rates, than a 95% occupancy full of plumbers and accountants.   Locally, we note that a small family amusement park, Fiesta Village, is closing.  Here in Oak Glen, (our ear to the ground), we hear that many merchants are complaining about low traffic, and some of them are looking to sell.

The Good News: The broader Riley family up here, however, have found ways to make Oak Glen a worthwhile destination.  Our high-interest problems aside, people book Sleepy Hollow MONTHS in advance, along with our Christmas Dinners.  If we make a push for just a bit more revenue, and a bit less debt, we would be reasonably profitable.  WE CAN DO THIS.

What God Wants

I am 66 years old.  I have a son, (born here, midwife-attended, in the attic of our home), who absolutely loves this place and wants it to continue and thrive.  Most of you know Gabriel.  He has brothers and sisters, and cousins, who support the grand vision.  I’ve probably dreamed, publicly, about what could be accomplished here so much that some of you are sick of it: re-forested canyons, hiking trails, shade structures, vineyards, heirloom apple orchards, cider caves, beautiful little cottages nestled in the trees, an actual working craft village, a New England Meeting House–a place where you leave your vacation here grateful to God and to America.  It’s such a radical thing, these days, that I have some pretty vile haters throwing F-bombs and death threats at me quite regularly.  I believe, with all my heart, we are doing a good thing, because the people who hate it, believe me, are really vile.

BUT, both my brother Scott and I have concluded that we will know what God wants if the people of Southern California “lean in” or not.   If our dinner theater continues to sell, if our field trips grow, if our funding campaign works, we will do everything we can to keep “Fort Riley” strong.  (Those of you who have left California for greener pastures, can help with our funding campaign.)  If we can’t make it, well, we can’t make it–and we will see what God can do with the Rileys somewhere else.

A Listing

We have absolutely NO IDEA what 760 acres of property in Southern California, with multiple single family residences, food facilities, orchards, water wells, roads, and a reasonably healthy business is worth.  But we know this: property like ours won’t sell at a reasonable price very quickly.  You may see a listing in the near future, and even that could mean good things: perhaps if a consortium of like-minded investors comes in alongside us and helps manage and capitalize this land, it would be the best way to combine various skills and strengths.  We don’t want to part with the property under fire-sale conditions, so we have to keep the “for sale” option out there.  We don’t WANT to sell, but we will if we have to.

Orderly Departure

Whatever we do, it will be orderly. We will fulfill all of our field trip and performance obligations, and we will use the proceeds of any sale to pay off any loan investors.  We don’t want to leave, but if we have to, we will do our duty to our guests and investors.

A City on a Hill

When I peacefully protested at January 6th, the day before the protest, on January 5th, I climbed the steps up to the Lincoln Memorial.  No one said anything to me.  I was alone.  No music was playing, no somber voice was narrating the occasion over a loud speaker, so I don’t know why I was overcome with a kind of embarrassing thankfulness.  We’re talking about, “old man, go hide behind that column and weep.”  I was powerfully undone by the majesty of our history, the crazy optimism of America, the beauty of what our ancestors created.  Our blessings were beyond measure, and it felt like one of those occasions where someone has done something for you that you can NEVER repay.

Our story needs to be told.  We want to tell it.  Your help, and prayers, are appreciated more than you know.

–Jim Riley

Categorised in: Farm Journal

This post was written by Jim Riley