Gladstone Land Buys Organic Vegetable Farm for $54 Million
- by Jordan Okumura
MCLEAN, VA – Gladstone Land Corporation is starting the year off with a bang. The company announced Thursday, January 12, that it acquired approximately 3,750 acres of organic farmland in southern Florida for $54 million—the single largest acquisition in the company’s history.
"We are privileged to acquire more organic farmland in Florida with a highly-regarded vegetable grower as our tenant-partner," said Bill Frisbie, the company's Managing Director for the Eastern United States, in a company statement.
Upon acquiring the land at a rate of roughly $14,400 an acre, the company entered into a lease agreement with a leading grower and marketer of fresh vegetables. The lease describes a seven-year deal that provides for annual rent escalations and three, five-year extension options.
"This property is farmed for organic vegetables in a region with significant development pressure from home builders,” noted Frisbie. “We now own 59 farms across the U.S., and we seek to continue building and diversifying our high-value agricultural portfolio. We have built our farmland portfolio on the thesis that the continued growing demand for fresh fruits and vegetables and nuts will make the finite supply of farms that produce these crops more valuable over time."
The company’s most recent acquisition represents a significant accomplishment for the already-established company.
"Our first acquisition of 2017 represents the largest acquisition in our company's history and begins what we believe will be our strongest year," said David Gladstone, President and CEO of Gladstone Land. "This new farm is a great property with a strong tenant, and we expect this acquisition will provide us with a significant amount additional earnings, which we hope to be able to pass on to our stockholders in the form of increased distributions.”
Gladstone noted that this massive land acquisition is the culmination of a trend toward significant growth for the publicly-traded company.
“We have now increased the distributions on our common stock five times over the past 24 months for a total increase of 43.3%, and our goal is to continue this trend,” noted Gladstone. “And these distributions we pay out to our stockholders are fully covered by our funds from operations."
What does the rest of 2017 hold for this flourishing company? Stay tuned to AndNowUKnow for updates.