DENVER, Jan. 21, 2021 /PRNewswire/ — Farmland Associates Inc. (NYSE: FPI) (the “Business” or “FPI”) declared these days that its previously disclosed negotiations relating to an prospect zone fund have resulted in the signing of a property sale and long-term administration agreements with Promised Land Option Zone Farms I, LLC (“OZ Fund”), a private expense fund concentrated on attaining and increasing farmland in capable possibility zones in the United States (“QOZs”), as specified less than U.S. tax provisions enacted in 2017. FPI will serve in a property administration ability for the OZ Fund and will have the ability to purchase fairness interests in the OZ Fund. The Firm will also have a ideal of 1st provide to purchase qualities owned by the OZ Fund.
“The romantic relationship with the OZ Fund demonstrates a strategic initiative to use privately capitalized cars to boost our assets under management and crank out expenses-for-company without having the have to have to raise fairness funds at possibly dilutive rates,” said Paul Pittman, FPI’s Chairman and CEO. “As the OZ Fund grows with new homes, our house management revenue will boost as very well as the over-all scale of the farmland that we handle. The transaction makes benefit for FPI shareholders by offering FPI land at a quality to guide value even though letting us to retain management of the properties in exchange for administration costs.”
The assets sale agreement supplies for, amongst other matters, FPI’s potential sale of roughly $47 million and 6,500 acres across 12 farms. The initial six farms are anticipated to shut by March, but all closings are subject to customary problems, including funding, and other contingencies. The OZ Fund is also focusing on farmland owned by third get-togethers and positioned in QOZs for possible acquisition. FPI has fully commited to fund 10% of the fairness required to acquire farmland owned by third parties up to a utmost of $20 million in exchange for passions in the OZ Fund. FPI will serve as assets supervisor for all farmland assets owned by the OZ Fund in exchange for property management service fees.
The OZ Fund was created to receive, make improvements to, and promote economic progress of land situated in QOZs. QOZs are sure economically distressed communities in the United States where by new investments, below specified circumstances, may perhaps be suitable for preferential tax treatment method. The OZ Fund was established and is managed by Servant Fiscal, a Chicago-primarily based financial commitment management firm.
“This is a win-earn,” commented John Heneghan, President of Servant Economic. “Promised Land Chance Zone Fund provides new sources of capital to farmland, increases financial ability and productiveness for farmers, and promotes work across agricultural communities. We consider the OZ Fund features financial, environmental, and social impacts that are persuasive for investors. We are pleased to collaborate with Farmland Associates, the farmland industry’s primary REIT, on our distinctive and impressive possibility zone auto.”
About Farmland Associates Inc.
Farmland Companions Inc. is an internally managed serious estate enterprise that owns and seeks to acquire high-excellent North American farmland and can make loans to farmers secured by farm real estate. As of the date of this launch, the Company owns about 155,000 acres in 16 states, which include Alabama, Arkansas, California, Colorado, Florida, Georgia, Illinois, Kansas, Louisiana, Michigan, Mississippi, Nebraska, North Carolina, South Carolina, South Dakota and Virginia. We have close to 26 crop styles and above 100 tenants. The Company elected to be taxed as a authentic estate financial investment trust, or REIT, for U.S. federal revenue tax purposes, commencing with the taxable 12 months finished December 31, 2014. Additional information: www.farmlandpartners.com or (720) 452-3100.
About Servant Monetary
Servant Economical, Ltd. is a Chicago-centered expense management firm started in 2003. The agency serves the assorted investment decision, hazard administration, and finance demands of folks, substantial net well worth clientele and family members workplaces. Servant Money focuses on choice investments – non-public equity and hedge money, ETFs, and socially liable investments. Further information: www.servantfinancial.com or (630) 264-0127.
This press launch includes “ahead-hunting statements” inside of the this means of the federal securities rules, such as, with no limitation, statements regarding the transaction, the anticipated timeline for closing, the Firm’s skill to market more qualities to the OZ Fund, the anticipated gross proceeds from the sales to the OZ Fund, the expected managements charges to be obtained by FPI, and the potential of the OZ Fund to obtain extra farmland homes. Forward-seeking statements commonly can be discovered by the use of forward-looking terminology these as “may perhaps,” “ought to,” “could,” “would,” “predicts,” “probable,” “carry on,” “expects,” “anticipates,” “foreseeable future,” “intends,” “programs,” “believes,” “estimates” or very similar expressions or their negatives, as well as statements in upcoming tense. Even though the Enterprise thinks that the anticipations mirrored in this kind of forward-hunting statements are based mostly upon sensible assumptions, beliefs and anticipations, these kinds of ahead-seeking statements are not predictions of upcoming situations or ensures of future efficiency and our true results could differ materially from these set forth in the forward-searching statements. Some elements that may induce these a big difference consist of the ability to consummate the transaction described higher than, gratification of experienced chance zone rules as determined by OZ Fund 3rd-celebration advisors, and the normal financial ailments. Any ahead-hunting data presented herein is built only as of the date of this push release, and the Corporation does not undertake any obligation to update or revise any forward-wanting data to replicate adjustments in assumptions, the event of unanticipated occasions, or normally.
Supply Farmland Associates Inc.