Could farmland be the next stock market darling?
In the U.S., companies are raising money through the stock market to buy and lease farmland.
Virginia-based Gladstone Land Corp. recently announced plans to sell up to $222 million in common stock and become the first publicly traded farmland leasing real estate investment trust. Other privately held real estate trusts are said to be planning public offerings.
Gladstone CEO David Gladstone already runs three publicly traded trust funds that invest in commercial property and business loans. He plans to buy farmland near urban areas and lease it to farmers on short-term “triple net leases” under which tenants are responsible for taxes, maintenance and insurance, as well as rent. The company also plans to offer higher interest rate mortgages with borrowers paying only the interest. In the event of default, the company plans to take ownership of the land.
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Farmland is also being endorsed by some high-profile investors, including Jim Rogers, who became a billionaire after partnering with famous financier George Soros (listed by Forbes as the 35th-richest man in the world) in the Quantum Fund. Founded in 1970, the fund grew by more than 4,000 per cent in just 10 years.
Now Rogers recommends investing in agriculture.
“Over the next few years, I think agricultural projects are going to be one of the best investments and agriculture is going to be one of the best industries in the world,” he said in a recent TV interview.
“Anybody who’s got potentially good agriculture land and good weather” stands to be a winner, Rogers said.
“God knows how high the price of agriculture is going to go, so that’s where I’m putting more of my money now.”
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“Ithinkagriculturalprojectsaregoingtobeoneofthebestinvestments…”
JIM ROGERS
AMERICAN BILLIONAIRE
