February 27, 2023

By Lynda Kiernan-Stone, Global AgInvesting Media

Leading vertical farming pioneer Plenty and Realty Income, a REIT-structured real estate investor, announced their strategic alliance to provide up to $1 billion in support of the development of Plenty’s indoor vertical farms.

“We are pleased to announce this strategic relationship with Plenty – whose sustainable business practices align with Realty Income’s values, which include giving more than we take in our community and environment,” said Sumit Roy, president and CEO, Realty Income.

“Our entry into agriculture technology provides another potential growth opportunity for our company. Over time, we aspire to expand our collaboration with Plenty internationally in markets of mutual interest.”

Plenty grows leafy greens using a highly-efficient vertical system that produces pesticide-free crops on a year-round basis, in rows of 20-foot tall columns, or walls, rather than horizontally. This configuration, which uses 1 percent the space of conventional agriculture and less than 5 percent of the water, is highly efficient as it allows water to trickle down each column, enabling nutrients to be gravity fed rather than pumped into the system.

The company also uses cutting-edge LED lighting systems that emit less heat than traditional LEDs, along with microsensor technology and big data processing, that together can be used to produce high-quality produce at lower prices.

And because of the configuration of this production system, Plenty is able to work with the forces of physics, not against them, enabling the company to scale multiple crops on one platform while saving significantly on cost of production to create resilience in our food systems against weather, location, pests, and climate.

Under the terms of the agreement, Realty Income will acquire and provide development funding for properties that will house Plenty’s farms, and as a first transaction, Realty Income has agreed to acquire the land and to back the development for the first farm of Plenty’s indoor vertical farm campus near Richmond, Virginia, initially announced last year. 

Moving for the first time beyond the U.S. West Coast, Plenty plans to deploy several large-scale vertical farms on the campus over the coming years, with a potential annual production capacity across multiple crops, including strawberries, leafy greens, and tomatoes, exceeding 20 million pounds.

This first farm at the campus will grow Driscoll’s strawberries – the first facility of its kind to grow indoor, vertically farmed berries at scale to supply the U.S. Northeast market. 

“This farm will combine Driscoll’s patented berry varieties with Plenty’s patented indoor vertical farming technology,” said J. Miles Reiter, chairman and CEO, Driscoll’s, in September 2022. “We are excited to take the next step in the journey to understand what it takes to bring fresh, flavorful berries locally grown all year-round.”

With an established presence supplying leading grocers on the U.S. West Coast, Plenty stated it plans to further expand its California footprint to include Walmart, which is also an equity investor in the company, when it launches its farm in Compton in Los Angeles County. 

Arama Kukutai, CEO, Plenty, commented, “Scale is a critical component of advancing indoor farming’s role as a core contributor to our global food supply. Teaming up with Realty Income is a significant step forward in accelerating the deployment of our farms with vertical farm facilities that are purpose-built to support Plenty’s proprietary growing technology.”

Plenty announced the appointment of Arama Kukutai – a pioneer and veteran of the agtech space, and co-founder and partner of agribusiness and food tech venture investor Finistere Ventures – as its new CEO in January 2022. 

Kukutai has been an investor in the company and a member of Plenty’s Board of Directors since September 2016, bringing more than two decades of leadership within the farming, agtech,  ag and agtech investment, and sustainability to bear on his task of overseeing Plenty’s growth into a scale vertical farming company.

“Indoor agriculture has long promised a solution to the challenges facing traditional growing, including solving year-round supply, supply chain disruption, high water use and widespread pesticide and chemical use,” said Kukutai upon the announcement.

Commenting on the positive implications this alliance with Realty Income brings for the indoor farming industry as a whole, Kukutai said,  “The predictability and positive unit economics of Plenty’s farms make it possible for us to utilize more traditional forms of funding, such as this strategic alliance with Realty Income. This represents an advancement in the way indoor farming assets are capitalized and paves the way for their development as an asset class.”

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~ Lynda Kiernan-Stone is editor in chief 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 Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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