Updated to reflect international expansion is not imminent.
Farmland Partners, the New York Stock Exchange-listed real estate investment trust (REIT), has launched a $25 million equity offering, a month after raising $35 million in a similar offer, as it looks to broaden its portfolio beyond commodity crops and ultimately buy farmland outside the US.
“We’re sitting on a substantial amount of cash. We bought a blueberry farm in July, we’re continuing to expand across the US and will eventually branch out from the US, (but when we do) we’ll only go to countries with rock-solid protections for property owners, places like the UK, Canada, New Zealand,” Paul Pittman, Farmland Partners’ chief executive told Agri Investor.
Initially focused on commodity crop farmland in the US Midwest, since listing in April last year the Colorado-based firm has grown its portfolio of farmland by more than 60,000 acres and it now owns around 70,000 acres of land across the US. Pittman said the firm will also be looking to acquire properties related to farming. “We will certainly buy processing facilities and we’ll make improvements in farms that aren’t purely about the land – tile drainage, irrigation, grain storage.” He said the company would expect “a slightly higher return than on raw land,” from property-related acquisitions.
Pittman said the offer “will allow us to allocate shares in very small quantities and dribble out [investment] into the market over a number of years.” As well as using the proceeds to make farmland acquisitions, the firm will also use the capital to build its recently-launched lending programme, which enables the REIT to make loans of $500,000 to $5 million to farmers.
When Farmland Partners went public last year it was only the second stock exchange-listed REIT, alongside Gladstone Land, specialising in US farmland. Now others are looking at the same route to access the market.
Last month PIA Farmland, a California-based REIT, announced it was raising $15 million in equity in preparation for a public offering next year, when it will look to list on a national exchange. And in June American Farmland Company filed with the Securities and Exchange Commission to raise up to $100 million. The REIT is likely to join Farmland Partners on the New York Stock Exchange.