Annual report pursuant to Section 13 and 15(d)

Commitments and Contingencies (Tables)

v3.20.4
Commitments and Contingencies (Tables)
 12 Months Ended
Dec. 31, 2020
Commitments and Contingencies Disclosure [Abstract]  
Schedule of Operating Lease Obligations
In connection with the execution of certain lease agreements, we have committed to provide capital improvements on certain of our farms, which are summarized in the table below (dollars in thousands):
Farm
Location		 Farm
Gross
Acreage		 Total
Commitment
Obligated
Completion
Date(1)
Amount Expended
or Accrued as of
December 31, 2020
Hillsborough, FL 55 $ 2,250 
(2)
 Q2 2021 $ 780 
Tulare, CA 160 700 
(2)
 Q2 2021 — 
Wicomico & Caroline, MD, and Sussex, DE 833 115  Q3 2021 36 
Van Buren, MI 89 150  Q4 2021 126 
Napa, CA 270 1,548 
(2)
 Q3 2023 — 
Santa Barbara, CA 271 4,000 
(2)
 Q3 2024 2,410 
Columbia, OR 157 1,800 
(2)
 Q3 2024 1,146 
Collier & Hendry, FL 3,612 2,000 
(2)
 Q2 2025 — 
Monterey, CA 304 1,248  Q4 2025 1,188 
(1)Our obligation to provide capital to fund these improvements does not extend beyond these respective dates.
(2)Pursuant to contractual agreements, we will earn additional rent on the cost of these capital improvements as the funds are disbursed by us.
Summary of Leasing Activity As of December 31, 2020 and 2019, we recorded the following as a result of these operating ground leases (dollars in thousands, except for footnotes):
December 31, 2020 December 31, 2019
Operating lease right-of-use assets(1)
$ 136  $ 178 
Operating lease liabilities(2)
$ 130  $ 172 
Weighted-average remaining lease term (years) 3.8 4.6
Weighted-average discount rate 4.20  % 4.20  %
(1)Operating lease right-of-use assets are shown net of accrued lease payments of approximately $6,000 as of each December 31, 2020 and 2019 and are included within Other assets, net on the accompanying Consolidated Balance Sheets.
(2)Included within Other liabilities, net on the accompanying Consolidated Balance Sheets.
The following table sets forth the components of our lease revenue for the years ended December 31, 2020 and 2019 (dollars in thousands, except for footnotes):
For the Years Ended December 31,
2020 2019
Fixed lease payments(1)
$ 51,377  $ 38,168 
Variable lease payments(2)
5,654  2,524 
Lease revenue, net(3)
$ 57,031  $ 40,692 
(1)Fixed lease payments include contractual rents under lease agreements with tenants recognized on a straight-line basis over the respective lease terms and includes the amortization of above-market lease values and lease incentives and the accretion of below-market lease values and other deferred revenue.
(2)Variable lease payments include participation rents, which are generally based on a percentage of the gross crop revenues earned on the farm, and reimbursements of certain property operating expenses by tenants. Participation rents are generally recognized when all contingencies have been resolved and when actual results become known or estimable, enabling us to estimate and/or measure our share of such gross revenues. During the years ended December 31, 2020 and 2019, we recorded participation rents of approximately $2.4 million and $2.3 million respectively, and reimbursements of certain property operating expenses by tenants of approximately $457,000 and $198,000, respectively. In addition, during the year ended December 31, 2020, we received a lease termination payment of approximately $3.0 million.
(3)Reflected as a line item on our accompanying Consolidated Statements of Operations and Comprehensive Income.
Schedule of Future Lease Payments Future lease payments due under the remaining non-cancelable terms of these leases as of December 31, 2020 and 2019, are as follows (dollars in thousands):
Future Lease Payments(1)
Period December 31, 2020 December 31, 2019
2020 $ —  $ 47 
2021 47  47 
2022 30  30 
2023 30  30 
2024 31  31 
Thereafter —  — 
Total undiscounted lease payments 138  185 
Less: imputed interest (8) (13)
Present value of lease payments $ 130  $ 172 
(1)Annual lease payments are set at the beginning of each year to then-current market rates (as determined by the State of Arizona). The amounts shown above represent estimated amounts based on the lease rates currently in place.