Family Land, Estates and Trusts: How to Handle a Data Center Offer

Data center developers look for large, contiguous tracts near transmission, and much of that land in rural America has been in one family for generations. That means offers often land on property that no single person controls: a farm left to several siblings, an estate still in probate, a parcel held in a revocable or irrevocable trust, or a family LLC set up decades ago. The developer’s first question, often unstated, is whether it can get a clean signature and a clean title commitment.

The well-reported Mason County, Kentucky case shows how these decisions play out inside a family. Ida Huddleston, 82, and her daughter, Delsia Bare, were approached about selling roughly half of the family’s 1,200 acres; the family said local farmland was valued at about $6,000 an acre and the offer was about ten times that, and Bare said dozens of neighbors had been approached by the same anonymous buyer.⁸ Reports say the family first agreed and then withdrew when it learned the land was meant for a data center, reported as a 2.2-gigawatt hyperscale project whose end user had not been confirmed.⁷ The project continued with owners who chose to sell.⁷

Farm-economics commentators describe these offers as turning a legacy into an investment decision overnight, and urge families to agree on their long-term goals first.⁹ For the farming side of that decision, including leases and rollback taxes, see our guide for farmers and ranchers.

Nothing a developer offers is binding until the right people sign, so start with the deed, the will or trust, and any entity documents. The table below shows the usual answer for each ownership form. State law and the specific documents control, so have a real estate or probate attorney confirm it before anyone signs an option agreement or even a confidentiality agreement.

Two practical points follow. First, a buyer will want a single negotiating counterpart, so families often appoint one spokesperson or one attorney while keeping the decision itself with the owners. Second, title problems are cheaper to fix before an option is signed than during the buyer’s due diligence; our guide to title and ALTA surveys explains what a buyer’s title company will look for.

When land passes without a will, the heirs usually hold it as tenants in common: each owns an undivided share of the whole, not a particular field. Under traditional partition law, any co-owner, whatever the size of the share, can generally ask a court to divide the land or order it sold and split the proceeds, and courts have often ordered sales. That matters in a data center market, because a single heir who wants the money, or an outsider who buys a small fractional interest, can push the rest of the family toward a sale they did not choose.

The Uniform Partition of Heirs Property Act (UPHPA) changes the process where it applies. The court determines fair market value, usually through an appraisal, and the co-owners who did not ask for a sale get the chance to buy out those who did at that value; if no buyout happens, the court orders division in kind unless that would substantially harm the co-owners as a group, and any sale is by default an open-market sale through a broker rather than an auction.³ The ABA counted the act as adopted in 24 states by the end of 2025, and the National Association of Conservation Districts’ 2025 list includes Alabama, Georgia, Iowa, Texas and Virginia, among others.⁴¹⁰

The act applies only to property that meets each state’s definition. Washington’s version, for example, requires among other things that 20% or more of the interests be held by co-owners who are relatives.¹¹ A family LLC with a clear operating agreement is another way to settle in advance who can sell and on what vote.

A trustee or executor deciding on a data center offer is not acting for themselves. Many states have adopted versions of the Uniform Prudent Investor Act; Hawaii’s enactment, for example, judges investment decisions in the context of the trust portfolio as a whole and includes a separate duty of impartiality among beneficiaries.¹ A large offer on a single parcel tests both: keeping the land may leave a trust undiversified, while selling may favor income beneficiaries who want cash over remainder beneficiaries who expected to inherit the land.

Disclosure is the other duty. Under Maine’s version of the Uniform Trust Code, a trustee must keep qualified beneficiaries reasonably informed about administration and about the material facts they need to protect their interests, and must respond promptly to reasonable requests for information.⁵ West Virginia’s version requires reports at least annually and at termination, covering trust property, receipts, disbursements and the trustee’s compensation.¹² Confidentiality clauses in an option or letter of intent should be written so the fiduciary can still meet these obligations; see our guide to confidentiality and project code names.

Habits that protect a fiduciary

• Read the trust or will for an express power of sale, any limits on selling particular land, and any wishes about keeping it in the family.
• Get an independent appraisal and, for large tracts, an independent view of whether the site has the power and zoning a buyer would pay for.
• Document the decision: the offer, alternatives considered, advice received and why the result serves the beneficiaries as a group.
• Avoid self-dealing: a trustee who also owns adjoining land or would be paid by the buyer should disclose it and take advice.

Timing relative to a death can change what a sale is worth. Inherited property generally takes a basis equal to its fair market value on the date of death (or on the alternate valuation date, if the executor files Form 706 and elects it), so heirs who sell soon after inheriting may owe little capital gains tax on appreciation that happened during the decedent’s life.² Where an estate tax return is filed, the IRS may require heirs to report a basis consistent with the value finally determined for estate tax, which an executor reports on Form 8971.² A date-of-death appraisal is therefore worth getting even when no estate tax is due.

The federal estate tax itself reaches few families. The basic exclusion amount is $15 million per person for deaths in 2026, up from $13.99 million in 2025, and the 2025 reconciliation law made the higher amount permanent and indexes it for inflation after 2026.¹³¹⁴ Portability lets a surviving spouse use the unused exclusion of the first spouse to die, but it is not automatic: the executor must elect it on a timely estate tax return.¹⁴ State estate and inheritance taxes are separate and can apply at much lower thresholds.

One federal rule deserves special attention. If an estate elected special-use valuation for farmland under Section 2032A, a sale to a non-family buyer or an end to the qualified use within 10 years of death (and before the heir dies) can trigger additional estate tax, reported on Form 706-A and due within six months of the disposition.⁶ Heirs considering a data center option on such land should have the recapture calculated before negotiating price.

Families that handle these offers well usually separate three questions: what the land is realistically worth for data center use, what each owner wants (cash now, income over time, or keeping the land), and how the decision will be made. A buyer’s first number is not a valuation; offers depend on power, zoning and acreage that the family can check independently. Our guide on whether land can host a data center covers the physical screen.

Whichever path the family chooses, write the decision rule down: unanimity, a majority of shares, or the trustee’s decision after consultation. Specific terms are covered in our guides to option agreement terms, ground leases and buying, optioning or leasing.

1. 01Pull the deed, will, trust and any LLC or partnership agreement, and list every person or fiduciary who would need to sign.
2. 02Ask an attorney whether your state has adopted the UPHPA and whether the land meets its definition.⁴¹¹
3. 03Clear title problems early: missing heirs, unprobated estates, old mortgages or easements.
4. 04For trusts and estates, confirm the power of sale and plan how beneficiaries will be informed.⁵
5. 05Get a date-of-death appraisal if one is missing, and have a tax adviser model basis, any 2032A recapture and state taxes.²⁶
6. 06Agree on a family spokesperson and a written decision rule before negotiating.
7. 07Check the site’s real potential independently before reacting to a number; you can get a site reviewed.

Our landowner’s path walks through the deal stages that follow once the family has decided to engage.