U.S.-based Farmland Partners announced its largest farmland purchase to date – the acquisition of a total of 15,042 acres across eight farms located in North Carolina, South Carolina, and Virginia for $80 million. The price paid to the unnamed seller is comprised of $49.8 million in cash and 2.9 million shares worth $30 million at closing on Tuesday, March 26.
The announcement of this deal comes just weeks after the group announced it had purchased 2,592 acres across three farms in Nebraska and Colorado for $16.6 million in cash and $2.7 million in limited partner interest and 63,000 shares of stock, and marks the group’s second biggest land acquisition in the U.S. southeast after it announced the purchase of 6,800 acres in South Carolina in December.
Farmland Partners, which acquires land with the goal of gaining returns from rental income and capital growth, has grown meteorically. When the group listed just a year ago, it has a portfolio consisting of 7,300 acres across three states. Upon completion of this latest deal, its portfolio will total 68,000 acres across nine U.S. states.
Under the terms of the latest deal, the seller would lease back the property at $4.3 million per year, and given the accretive nature of the deal, Farmland Partners management is expected to recommend to the board that the company’s quarterly dividend be increased by 10% to an annual rate of $0.51 per share.
To receive relevant news stories with summaries provided by GAI Research & Insight, subscribe to Global AgDevelopments, our free weekly enhanced eNews service