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Homestead Fund II raises $387m, increases target

Farmland investment firm Homestead Capital fell $52m short of its target for its first fund last year, but has already surpassed its initial $350m target for Fund II.

Homestead Fund II has raised $387.5 million and increased its target to $400 million, two months after it first filed with the Securities and Exchange Commission with no declared commitments and an original target of $350 million.

The firm, which specialises in farmland investment, made an SEC filing declaring the capital at the end of last week.

The Maine Public Employees Retirement System committed $50 million to the fund in July, according to the pension’s chief executive Andrew Sawyer.

In August, the firm made an SEC filing which declared no capital, suggesting it had built a pipeline of soft commitments. Another institution, the $109 billion Washington State Investment Board, recommended a $100 million investment in Homestead Capital USA Farmland Fund II in September. 

Homestead Capital closed its first fund on $173 million last year, falling $52 million short of its target. Fund I received support from a range of institutional investors, including Texas Teachers Retirement System, which allocated $15 million, and the University of Alabama.

Last year the Southeastern Pennsylvania Transportation Authority Pension Committee appointed Homestead Capital as a fund manager.

Managing partner and head of portfolio construction at Homestead Capital, Daniel Little, told Agri Investor last year that Fund I would target farm assets in the Mountain West, Pacific, Midwest and Delta regions. He said about 30 percent of the fund would be invested in permanent crops and the rest in row crops.

The firm enhances value and diversification with improvements. It uses various lease types and brings in its own operators on some properties, managing partner and head of acquisitions Gabe Santos said last year.

Homestead refused to comment, citing SEC marketing regulations.