One way might be buy calls on ETFs with a low correlation to real estate and/or buy puts on ETFs with a high correlation to real estate. To help find these, see the attached semicolon-separated IYR_correlations.csv that has recent, three-year, daily return correlations (QUantDare method) of iShares U.S. Real Estate ETF (IYR) with other ETFs.
If it’s just in the path of development but hasn’t gone through the series of development steps, it’s already priced too high. The adage “you make your money when you buy and get paid when you sell” applies. His hedge would be the optionality of developing raw land. Achieving each step in development ratchets the price and he either has the cash/financing and knowledge to be in the drivers seat or partners with someone who does. Lot’s of folks do land banking but only a relative few whom can drive a deal to completion. There are more reliable ways to make money than sitting on land without a plan. Generally, good deals don’t last long and the best deals are the ones where you’ve beaten the bushes to find a motivated seller with no competition - then just flap your gums if you’re any good a negotiating. Contracts can be constructed to be negotiable instruments. The low risk way is to get a contract on the property and immediately shop it, money flows to good deals and is resistant to bad ones.
I would just use one of these. I'm assuming he is buying the land for future residential real estate development. I'd find one that closely correlates to his market, could be one on the other side of the country. Also, don't know how liquid these are. https://www.cmegroup.com/trading/real-estate.html