November 30, 2021

By Lynda Kiernan-Stone, Global AgInvesting Media

Gladstone Land has announced its sixth deal since the beginning of August – this time, a $2.4 million deal in the Pacific Northwest.

The REIT’s latest acquisition is 165 gross acres of farmland located near Milton-Freewater, Oregon, on which the company plans to plant a vineyard. And as is standard for Gladstone, the company has entered into a 10-year, triple-net lease agreement with an existing tenant who is a leader in the wine industry. 

“We are excited to make another acquisition in Oregon,” said Tony Marci, managing director, Gladstone Land. “Our tenant will plant a vineyard on this land, which is located within the Walla Walla Valley AVA. The property is in a beautiful setting on land overlooking the Walla Walla Valley.”

Cheers

Despite accounting for only 1.2 percent of the wine produced in the U.S., and 0.15 percent of the wine sold globally, Oregon wines punch above their weight, representing 5 percent of the top 100 Global Wines List issued by Wine Spectator.

In 2019 the Oregon wine industry recorded its best year on record, with retail profits up by 12 percent and wholesale profits up by 13 percent. Furthermore, sales of Oregon grapes to out-of-state winemakers have jumped by 15 percent, thanks to the state’s novel terroir, or its soil and climate conditions. 

Like for most businesses, 2020 and the global pandemic, compounded by labor shortage issues and wildfires, were hard on Oregon’s wine industry, which saw losses totaling $1.5 billion. Prior to the pandemic, the state’s wine industry was a $900 billion per year business. 

But the state’s growers are reporting more positive turns, according to OPB, with three 2020 wines included in Wine Enthusiast’s Top 100 list, and some wine growers reporting their best season in 25 years. And at a time when most categories are contracting, Oregon’s wine industry has expanded this year with a 10 percent jump in the number of wineries in the state. 

Adding to this number will be this new vineyard developed by Gladstone, which now owns 162 farms, comprised of 109,000 acres across 15 different U.S. states, along with 45,000 acre-feet of banked water in California, which all together carry a value of approximately $1.4 billion.

“This land, with established water rights, will be a great addition to our portfolio,” said David Gladstone, president and CEO, Gladstone Land. “We are pleased to expand the relationship with our tenant and help them to continue providing premium wines to their customers.”

– Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Oilseed & Grain News. She can be reached at lkiernan-stone@globalaginvesting.com.