Gladstone Land Acquires Two Almond Orchards in California
- by Melissa De Leon Chavez
MCLEAN, VA - Gladstone Land Corporation has acquired two large California almond orchards, one in Stanislaus County and one in Merced County.
The acquisition was made for about $23.4 million in cash and 343,750 common units of limited partnership interest in the company's operating partnership, with OP Units issued valued at $12.00 per unit. As a result, Gladstone stated the total deal came out to about $27.5 million for 2,485 total acres, or just over $11,000 per acre.
"This completes our second farmland acquisition in the past two weeks, each of which involved a significant amount of OP Units that were issued as partial consideration for the total purchase price," said David Gladstone, President and CEO of Gladstone Land, according to a press release. "Both these almond orchards have strong access to water, including numerous wells and reservoirs on-site.”
As part of the deal, Gladstone Land assumed two long-term, triple-net leases, including annual CPI increases and upward market rent adjustments every five years.
Bill Reiman, Gladstone Land's Western Managing Director, commented that the trees for both farms are approximately nine years old and are just beginning their peak production.
"We view these acquisitions as low-risk in that they come with long-term leases with an outstanding tenant. The lease terms provide for rent escalations that we feel confident will provide for excellent, safe returns for many more years. While this purchase increases our position in the almond industry, it also adds a strong, cash-rent lease with a very large, international tenant," Reiman said.
As for future moves in the industry, Gladstone not only has intentions to continue buying but also is encouraging consumption.
“Our experienced deal team continues to find great farmland investment opportunities focused on high-value, income-producing properties that are currently generating strong crop revenues. Please eat more almonds; they are a healthy food!" Gladstone concluded.
Continue to follow AndNowUKnow as we on all notable acquistions made within the industry.