April 25, 2024

By Lynda Kiernan-Stone, Global AgInvesting Media

Indoor farming company Vertical Harvest Farms announced that it has secured $59.5 million in financing for the development and operation of a 51,000-square-foot hydroponic vertical farm in Westbrook, Maine. 

This funding was led by Madison One, and was supported by Waterside Commercial Finance, and includes $25 million and $23.795 million in loans that utilize USDA Rural Development Business & Industry Loan Guarantees and Rural Energy for America Program (REAP) Renewable Energy and Energy Efficiency Loans, respectively.

“As ‘The People’s Department,’ we are happy to support fresh food, and good jobs here in Maine, as well as the equity of access to both,” said Rhiannon Hampson, Maine state director, USDA Rural Development. “USDA Rural Development is committed to building communities and feeding Mainers, and we look forward to Vertical Harvest being a part of the team fulfilling those shared goals.”

The financing was also supplemented by a $8,655,189 Commercial Property Assessed Clean Energy (C-PACE) loan – the first in Maine administered by the Efficiency Maine Green Bank and issued through Nuveen Green Capital – and $2 million of American Rescue Plan (ARPA) funding through the Finance Authority of Maine (FAME).

“We are pleased to have approved Vertical Harvest for this funding through the Efficiency Maine Green Bank in partnership with one of our capital providers, Nuveen Green Capital,” said James Neal, senior manager for finance initiatives, Efficiency Maine. “We strongly encourage more of Maine’s municipalities to follow Westbrook’s example and adopt this ordinance so their local businesses can take advantage of this unique pathway to finance energy improvements, such as upgrading lighting or installing heat pump systems for heating and cooling in their buildings.”

In addition, it was noted that borrower and partner contributions of $19,189,210 were possible thanks to partners such as Crossroads Impact Corp., Enhanced Capital, Waterside Commercial Finance, Maine Technology Institute, and others. 

This project is a critical part of Maine’s food system infrastructure and will significantly contribute to New England Food Vision – a common goal for the region’s six states to locally produce 30 percent of the food consumed by 2030, and 50 percent by 2060, by producing about 2.5 million pounds of fresh leafy greens each year. And this combination of innovative funding, using public-private partnerships to back Vertical Harvest, shows a belief in the company’s model to catalyze resilience within a state’s food system.

“Public-private partnerships benefit a wider group of stakeholders than private capital can alone,” said Gingee Prince, chief impact officer and managing director, Enhanced Capital. “In 2017, we partnered with Vertical Harvest to pioneer this space and are excited to see them building even more ambitious capital coalitions today.”

Using food as a medium for meaningful change, Vertical Harvest is a hydroponic, vertical farming company that not only is dedicated to the sustainable production of healthy foods, but also operates an inclusive employment model.

Driving its mission to energize local food economies, Vertical Harvests’ farms are designed for accessibility and are staffed through hiring systems developed for people with disabilities. Along the way, the company partners with civic leaders and local developers to co-locate its farms with affordable housing developments, bolstering local green energy initiatives, re-connecting people with local fresh, flavorful foods, and keeping money in-community.

“We are changing the world by focusing on creating beautiful buildings in urban environments that provide community renewal, jobs and life training for people who are employment-challenged and nutritious food that is local, fresh and better tasting,” said Nona Yehia, CEO and co-founder, Vertical Harvest, in 2022 when the company closed on an $8.35 million Series A. “We will do this all while generating good returns for our shareholders.”

Last year, the U.S. became a net food importer for the first time, prompting stakeholders to realize that traditional agriculture is under increasing stress from water scarcity, extreme weather events, and climate change.

This evolution in circumstances has also made diversifying food production, leveraging technology, shortening supply chains, and ensuring access to fresh, local food more critical than ever. 

With this knowledge, Vertical Harvest believes that its financing model that it piloted in Wyoming, and has now proven in Maine, will pave the way for financing future farms such as the company’s next facility to be developed in partnership with Bedrock in Detroit, Michigan. 

The project as a whole also aligns with Vertical Harvest’s “feed locals first” philosophy by providing greens from farm-to-fridge within 24 hours. By achieving this, the company helps consumers avoid the 30 percent loss of nutritional value that occurs within three days of harvest. It also mitigates food waste by extending shelf life and less shrinkage at the retail and institutional level.

By combining municipal, state, and federal funding with private capital, and then applying that funding to the support of its particular mission, not only is Vertical Harvest relocalizing the production of perishable produce closer to its consumer base, but because of its social mission, is delivering outsized social impact and inclusivity at the same time.

Yehia concluded, “We’re on a mission to grow food as local, fresh and fair as possible, and ensure there’s a place at the table for everyone in the future of food.”

~ 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. She can be reached at lkiernan-stone@globalaginvesting.com.

*The content put forth by Global AgInvesting News and its parent company HighQuest Partners is intended to be used and must be used for informational purposes only. All information or other material herein is not to be construed as legal, tax, investment, financial, or other advice. Global AgInvesting and HighQuest Partners are not a fiduciary in any manner, and the reader assumes the sole responsibility of evaluating the merits and risks associated with the use of any information or other content on this site.