Institutional Farmland Investors - Part Three
Tim Hammerich
News Reporter
On Friday we reported on how institutional investors in some cases are sharing in the cost of new farming technologies with their farmer tennants. They want to make sure that the farms are optimized for long term sustainability and profitability. But there’s also a chance that in the future, data and technology will be drivers in adding value to the land itself. Here is farmland investment consultant Skye Root.
Root… “If you were to say, you know, is there a 10% or a 15% valuation premium or rent premium to a farm that has all the latest bells and whistles in the AgTech space? You know, is there that premium? I would say no there isn't. But will there be, uh, as we look at the future of agriculture? Yes, I do. I, I think in 10 or 15 or 20 years, there will be a premium to property that, that has all the data and the proof that, Hey, we are better than our neighbor. We have done these, taken these steps. We use less water. We put way less, you know, inputs into the watershed. We have maximized our yield.”
Root added that investor priorities aren’t only focused on environmental sustainability, but on social issues as well. Technology and automation could have a role to play in helping with working conditions, as one example.
