Farmland as an Asset Class

Tim Hammerich

News Reporter

Over the decades, farmers have primarily built their wealth through acquiring farmland. Investors have taken notice of the long term returns that this land has achieved historically, and are finding ways to invest in farmland for themselves. Craig Wichner is the managing partner at Farmland LP, a firm that acquires and manages farmland on behalf of their investors.

Wichner… “Farmland is a giant asset class. There's over $3.1 trillion worth of farmland in the US. And that at least as of a few years ago was the same economic value as all of the apartment buildings in the US or all of the office buildings in the US. And 54% of US farmland is leased. So farmland is commercial real estate, if you look at it from that perspective just like the other asset classes. There's only 11% debt on the entire, and only 2% of farmland is institutionally owned.”

In that diversity is where Farmland LP finds investment opportunities. Most often, they buy land that has been used for commodity crops and plant higher value crops that can be managed in an organic and regenerative way. They then rent that land to local farmers.