Gladstone Land Acquires Almond Farm in California
- by Melissa De Leon
MCLEAN, VA – Gladstone Land has furthered its national investments by announcing it has acquired another almond orchard in Fresno County, California. The almond orchard consists of approximately 197 acres, and was acquired by Gladstone for $6.5 million. This deal came out to roughly $33,000 per acre.
"Our team has been very successful finding high-quality farms with plenty of water that continue to appreciate in value and provide strong returns along the way," said David Gladstone, President and CEO of Gladstone Land. "Such acquisitions have allowed us to increase the monthly distributions on our common stock twice over the past year for a total increase of 6.3%. This farm is another acquisition we're excited about, as the trees are in their prime production period, and we expect the participating rent component to provide us with nice returns that will aid in our goal of increasing distributions to stockholders every year. In the meantime, please eat more almonds; they are a healthy food!"
The company stated in a press release that upon acquiring the orchard, Gladstone entered into a 10-year, triple-net lease agreement with the seller. The seller is one of the largest organic almond growers in the world.
Gladstone expects the annual cap rate on the property will average between 8 percent and 10 percent over the life of the lease. This lease includes two, 5-year extension options, and consists of both a fixed cash rent component plus a variable rent component based on the gross crop revenues earned on the property.
"We are pleased to announce the acquisition of a really nice almond orchard that is just now heading into its peak production years," said Bill Reiman, Gladstone Land's Western Managing Director. "We acquired the property in connection with a sale-leaseback agreement with a vertically-integrated tenant who is an excellent almond farmer and marketer. Due to the age of the trees, we should begin earning significant rental returns from the participating rent component of the lease with next year's crop. We are very excited to add another high-quality almond orchard with a strong tenant to the list of farms we own."
This is the third almond orchard procured by Gladstone in recent months. As we previously reported, the company also made acquisitions on two California orchards in Stanilaus County, and Merced County.
This latest investment brings Gladstone Land to 57 farms currently owned, which spans 33,997 acres in 7 different states across the U.S. Gladstone Land’s acreage is valued at approximately $384 million.
As the company continues to expand its reach of investment with farms and orchards, AndNowUKnow will report the acquisitions as they come in.