According to a survey by Aquila Capital 23% of institutional investors are looking to increase their holdings in farmland and 74% are expecting to maintain their holdings. Despite this, currently farmland represents on average only 1.3% of portfolios. Historically the three most popular investment vehicles by which to access farmland have been specialist investment funds (53%), closed-end funds (40%), and club deals/co-investments (20%). Aquila found that investors are becoming more sophisticated when it comes to farmland with a 55% majority categorizing it as its own separate asset class while 45% still treat it as part of their overall exposure to real estate. The study concludes that some of the issues that investors find with funds in the agriculture sector are the lack of track records and realized returns.
To receive relevant news stories with summaries provided by GAI Research & Insight, subscribe to Global AgDevelopments, our free bi-weekly enhanced eNews service