Outstanding offer convinces Gladstone to sell $21m asset

NASDAQ-listed farmland REIT Gladstone Land Corporation has sold a 1,895-acre farm in Oregon to its unidentified current tenant for $20.5 million.

Located in Boardman in Oregon’s northern Morrow County, the property grows onions and potatoes. According to Gladstone’s website, the farm includes a certificate of water rights through the Oregon Water Resources Department and is supplied through the Potlatch Water Delivery System that draws from the nearby Columbia River.

Dale Bills, vice president of communications at Salt Lake City, Utah headquartered company Church of Jesus Christ of Latter Day Saints-affiliate AgReserves, told Agri Investor in an email that the company would decline a request to discuss “our purchase of farmland in Morrow County” in detail.

Gladstone managing director Bill Frisbie said the sale would produce a 20 percent internal rate of return on the company’s initial investment in the property that would result in a net gain of $6.4 million.

“Our strategy is to buy and hold for the long term, but occasionally we receive an offer that warrants serious consideration,” Frisbie explained. “The $20.5 million offer represented a 22 percent premium over the farm’s most recent valuation, resulting in a $0.22 increase to our estimated net asset value per common share.”

The sale of one of Gladstone’s four Oregon properties comes months after the REIT added a managing director focused on the Northwest.

According to his LinkedIn profile, Tony Marci joined Gladstone as a managing director in March. He previously served for approximately six years as an agricultural investment manager and two years as a director of agricultural investments and operations at Naturipe Berry Growers, a berry-focused marketing cooperative based in Salinas, California.

As of May, Gladstone’s 75-farm portfolio totaled 63,351 acres across nine US states and was valued at approximately $537 million. The farms produce a range of 40 different crops through leases to 53 tenants, with a primary focus on fresh produce and a secondary focus on nuts.

While reporting a first quarter net loss of $318,000 in May, chairman and chief executive David Gladstone acknowledged that “the year had started off a bit slow” in terms of acquisitions, but said its pipeline for potential acquisitions over coming months remained “very strong.”

In March, the company acquired a 176-acre blueberry farm in Michigan for $2.1 million.