Online marketplace for farmland investing will enable investors to cash out earlier; additional options planned for future
SAN FRANCISCO–(BUSINESS WIRE)–January 23, 2020–
FarmTogether, the online marketplace that offers access to institutional quality U.S. farmland investments, today announced a pilot program that will give investors more options for liquidity. Beginning in September 2020, FarmTogether will roll out a Secondary Market Pilot with its El Nido almond investors.
Over the last half a century, farmland has yielded returns of approximately 10%. From 1992-2016, the performance was even stronger, with a 12% return compared to the larger real estate market at 8.7%, and with lower volatility. As the global population rises, occupying land and straining food supply, the demand for quality farmland continues to increase, with the U.S. market projected to reach $2.5 trillion. Based on the belief that farmland is a safe, stable, and attractive long-term investment for everyone, FarmTogether created a new kind of marketplace to radically democratize farmland investing.
“FarmTogether broke new ground in enabling non-institutional investors to take advantage of returns on historically strong U.S. farmland investments,” said FarmTogether founder and CEO, Artem Milinchuk. “Recently, some of our investors expressed that they would like to have options for liquidity earlier than the end of the hold period, while others would like to hold for longer periods. We are delighted to make these options happen, starting with the Secondary Market Pilot program.”
Beginning in September 2020, FarmTogether will enable existing investors to offer some or all of their units of ownership for sale.
How It Works:
- Sales will be facilitated by FarmTogether via email and/or a dedicated portal.
- For most farms, the First Liquidity Window will open 366 days after the closing date for that investment, and the window will stay open for 30 days.
- Second and subsequent Liquidity Windows will open on an annual cadence and remain open for 30 days. More frequent Windows, such as quarterly and monthly, are anticipated.
- The price will be set by the investor and can be adjusted once every five days.
- The Secondary sale will first be available to existing investors in the farm for five days, then to investors in any farm for the following five days and then to all registered users of FarmTogether.com for the remaining 20 days. Note: accreditation standards may still apply.
This option will be available on all FarmTogether current and future deals unless constrained by the specifics of a particular deal. FarmTogether plans to offer longer hold options– periods of 10-20 years– in 2021.
Through the FarmTogether platform, investors have a single destination to browse potential farmland investments, review due diligence materials, invest in properties, and sign legal documents– all securely online. FarmTogether’s experienced investment team and partners select the top properties from hundreds of investment opportunities. They conduct comprehensive due diligence internally, including macro and end food markets, while external diligence groups do soil, leaf and water rights analysis, and a farm’s potential for capital improvements. Investment offerings are legal entities that own the titles to clients’ investment properties. When clients invest on FarmTogether, they purchase shares in an LLC, becoming a fractional owner of the farmland. They then are entitled to returns from its operation.
To learn more about FarmTogether and its current properties, please visit farmtogether.com.
FarmTogether is a new kind of online marketplace that enables individuals to invest in U.S. farmland. The company has developed an end-to-end platform that allows investors to browse carefully vetted farmland investments, review due diligence materials, invest in properties, and sign legal documents all in a secure online environment. FarmTogether’s team and partners are cross-industry professionals with over 70 years of experience across farmland investing, agriculture and real estate in the U.S. and globally. Learn more at www.farmtogether.com.