Institutional Farmland Investors - Part One

This is Tim Hammerich of the Ag Information Network with your Farm of the Future Report.

More and more institutional investors are investing in farmland. While this may have the perception of rich Wall Streeters scooping up rural properties, farmland investment consultant Skye Root says that in many cases, the truth is much different.

Root… “The folks that are managing that retirement money, the mutual funds, the pension funds, in the sake of, you know, pilots, firefighters, teachers. You know, those are pension plans that manage those assets. They see farmland as a slice of their investment pie that is really interesting.”

Root says despite the increase in this type of investment, these institutional investors still hold a very small percentage of U.S. farmland.

Root… “You know, when you look at land ownership and farmland. You know, institutional land ownership is still incredibly small in the overall piece of the pie. So it's not like these pension funds are taking over the farmland world. And then they keep it as farmland. Right? I mean, it's, you know, if I look at the maybe 500 properties I've been associated with over the last 15 years. Maybe one or two of them have been sold to some sort of an alternative use, you know, build into commercial or a residential type of a play. You know, the rest of them call it the other 498 properties. They're still in farmland. And they will be in farmland for decades and decades to come, because that's the thesis.”

Tune in tomorrow for more on institutional investment in farmland.