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Bill Gates, the largest private owner of farmland in the United States with nearly 250,000 acres under his portfolio, has drawn attention to the growing appeal of farmland as an investment.
For those fascinated by the stability and long-term value of farmland, farmland real estate investment trusts (REITs) offer a practical way to gain exposure to the asset class. These REITs allow investors to benefit from the growing demand for food and agricultural products without the large upfront costs or operational complexities of buying and running a farm.
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Here are two farmland REITs you can invest in today.
Gladstone Land Corp.
As of June 30, Gladstone Land Corp. Gladstone, Inc. (NASDAQ:LAND) owns and operates 168 farms with approximately 111,836 acres in 15 states. Gladstone focuses primarily on farms that grow annual fresh produce, including most fruits and vegetables, and certain permanent crops, including blueberries and nuts.
Gladstone Land currently pays a monthly dividend of $0.0467 per share, which equates to an annual dividend of $0.5604 per share and gives the stock a yield of approximately 4.1% at the time of writing.
In addition to a high yield, Gladstone Land offers dividend growth. It raised its dividend by 0.2% in July, marking the 35th time the company has increased its dividend over the previous 38 quarters. The company also notes that it has paid 137 consecutive monthly dividends since its IPO in January 2013.
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Agricultural Land Partners
As of June 30, Agricultural Land Partners (NYSE:FPI) owned and/or managed nearly 300 farms with approximately 180,063 acres of farmland in 17 U.S. states, making it the largest farmland REIT in the country by acreage. It also owns land and buildings for four farm equipment dealerships in Ohio that are leased to Ag-Pro under the John Deere & Co. brand.
Farmland Partners currently pays a quarterly dividend of $0.06 per share, which equates to an annual dividend of $0.24 per share and currently yields approximately 2.4%.
While the yield is much lower than Gladstone’s, it’s worth noting that Farmland Partners declared a special dividend of $0.21 per share in January due to the strong farmland market in 2023. If you included this special dividend in the 2024 total, the yield would be over 4%.
Better returns than some REITs?
Today’s high interest rates offer income-seeking investors a great opportunity to earn huge returns, but not through REITs.
Arrived Homes, the Jeff Bezos-backed investment platform, has launched its Private Credit Fund, which offers access to a pool of short-term loans backed by residential real estate with a target of 7% to 9% net annual yield distributed to investors monthly. In July, it distributed 8.1%. The best part? Unlike other private credit funds, this one has a minimum investment of just $100.
With long-term rates falling and short-term rates remaining high, there is a unique opportunity to invest in fix and flip loans before yields fall. Check out Benzinga’s favorite high-yield offerings.
This article Invest in Farmland Like Bill Gates, With These REITs Yielding Up to 4.1% originally appeared on Benzinga.com
