Farmland has been one of the most underrated real estate investments, but easier access to this asset class has opened the eyes of many investors to the benefits that investing in farmland can offer.
Why invest in farmland? Agricultural goods are the United States’ largest export, with a total volume of US $ 135.7 billion in 2020 and an estimated US $ 164 billion in 2021. As the demand for US-produced crops continues to grow worldwide, the available land for agriculture is steadily declining as land is used for development.
This increasing scarcity has steadily driven demand for arable land, resulting in an average annual return of 11% over the past 20 years.
While farmland investments have historically been reserved for institutional investors, platforms like FarmTogether have opened up that opportunity for retail investors by allowing them to purchase shares in farmland assets.
Latest offer: FarmTogether’s latest offering is for the Goldenrod Pecan Orchard, 410 acres of plantable land to be expanded into a pecan farm along the southern Oklahoma border. It is expected to take five years to develop for the trees to mature.
Investment highlights: The farm is leased by an experienced operator and begins to pay an annual basic rent of 5% of the purchase price until 2033 plus a harvest share of 20% of the gross yield until 2033 and 5% thereafter.
Details of the offer can be found on FarmTogether’s website and the company is hosting a webinar on Monday, September 13, 2021.
Photo: Marcia Cripps on Unsplash.
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