Institutional Investors in Farmland – Part Three

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Institutional Investors in Farmland – Part Three

Tim Hammerich
Journalist

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

On Friday, we reported on how institutional investors, in some cases, share the cost of new agricultural technologies with their tenant farmers. They want to ensure farms are optimized for long-term sustainability and profitability. But there is also a chance that in the future, data and technology will be drivers to add value to the land itself. Meet Skye Root, agricultural investment consultant.

Root… “If you were to say, you know, is there an appraisal premium or a 10% or 15% rent premium for a farm that has all the latest bells and whistles in the AgTech space? You know, is there that bounty? I’d say no there isn’t. But will there be, uh, as we look at the future of farming? Yes. I, I think in 10 or 15 or 20 years there will be a property premium that, that has all the data and proof that, Hey, we’re better than our neighbor. We’ve done this, taken these steps. We’re using less water. We’re putting a lot less, you know, inputs into the watershed. We’ve maximized our yield.”

Root added that investors’ priorities are not only focused on environmental sustainability, but also on social issues. Technology and automation could have a role to play in improving working conditions, for example.

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