Subsequent Events (Tables)
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6 Months Ended |
Jun. 30, 2019 |
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| Subsequent Events [Abstract] |
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| Schedule of Asset Acquisitions, by Acquisition |
During the six months ended June 30, 2019, we acquired five new farms, which are summarized in the table below (dollars in thousands):
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Property
Name |
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Property
Location |
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Acquisition
Date |
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Total
Acreage |
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No. of
Farms |
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Primary
Crop(s) |
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Lease
Term |
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Renewal
Options |
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Total
Purchase
Price |
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Acquisition
Costs(1)
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Annualized
Straight-line
Rent(2)
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New
Long-term
Debt |
Somerset Road |
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Lincoln, NE |
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1/22/2019 |
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695 |
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1 |
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Popcorn &
edible beans |
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4.9 years |
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1
(5 years) |
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$ |
2,400 |
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$ |
33 |
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$ |
126 |
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$ |
1,440 |
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Greenhills Boulevard(3)
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Madera, CA |
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4/9/2019 |
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928 |
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1 |
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Pistachios |
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10.6 years |
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2
(5 years) |
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28,550 |
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141 |
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1,721 |
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17,130 |
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Van Buren Trail(4)
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Van Buren, MI |
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5/29/2019 |
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159 |
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1 |
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Blueberries
& cranberries |
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10.6 years |
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2
(5 years) |
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2,682 |
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24 |
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206 |
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— |
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Blue Star Highway(4)
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Allegran &
Van Buren, MI |
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6/4/2019 |
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357 |
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1 |
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Blueberries |
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10.6 years |
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2
(5 years) |
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5,100 |
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29 |
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390 |
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— |
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Yolo County Line Road(4)
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Yolo, CA |
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6/13/2019 |
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542 |
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1 |
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Olives for
olive oil |
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14.6 years |
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1
(5 years) |
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9,190 |
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68 |
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624 |
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— |
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2,681 |
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5 |
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$ |
47,922 |
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$ |
295 |
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$ |
3,067 |
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$ |
18,570 |
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(1) |
Includes approximately $18,000 of aggregate external legal fees associated with negotiating and originating the leases associated with these acquisitions, which costs were expensed in the period incurred.
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(2) |
Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the applicable lease, as required under GAAP, and excludes contingent rental payments, such as participation rents. |
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(3) |
Lease provides for a participation rent component based on the gross crop revenues earned on the farm. The rent figure above represents only the minimum cash guaranteed under the lease. |
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(4) |
See Note 11, “Subsequent Events—Financing Activity,” for information on loans secured by these properties that were obtained subsequent to June 30, 2019.
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During the six months ended June 30, 2018, we acquired two new farms, which are summarized in the table below (dollars in thousands, except for footnotes):
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Property
Name
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Property
Location
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Acquisition
Date
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Total
Acreage
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No. of
Farms
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Primary
Crop(s)
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Lease
Term
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Renewal
Options
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Total
Purchase
Price
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Acquisition
Costs
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Annualized
Straight-line
Rent(1)
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New
Long-term
Debt
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Taft Highway(2)
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Kern, CA |
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1/31/2018 |
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161 |
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1 |
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Potatoes and Melons |
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N/A |
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N/A |
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$ |
2,945 |
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$ |
32 |
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$ |
— |
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$ |
1,473 |
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Cemetery Road |
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Van Buren, MI |
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3/13/2018 |
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176 |
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1 |
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Blueberries |
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9.6 years |
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None |
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2,100 |
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39 |
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150 |
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1,260 |
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337 |
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2 |
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$ |
5,045 |
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$ |
71 |
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$ |
150 |
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$ |
2,733 |
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(1) |
Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the applicable lease, as required under GAAP, and excludes contingent rental payments, such as participation rents. |
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(2) |
Farm was purchased with no lease in place at the time of acquisition. |
Subsequent to June 30, 2019, through the date of this filing, we have acquired two farms, which are summarized in the table below (dollars in thousands, except for footnotes):
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Property
Name |
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Property
Location |
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Acquisition
Date |
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Total
Acreage |
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No. of
Farms |
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Primary
Crop(s) / Use |
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Lease
Term |
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Renewal
Options |
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Total
Purchase
Price |
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Acquisition
Costs(1)
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Annualized
Straight-line
Rent(2)
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San Juan Grade Road(3)
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Monterey, CA |
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7/11/2019 |
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324 |
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1 |
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Strawberries
& vegetables |
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0.3 years |
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None |
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$ |
9,000 |
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$ |
62 |
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$ |
575 |
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West Citrus Boulevard(4)
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Martin, FL |
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7/22/2019 |
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3,586 |
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1 |
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Water
retention |
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8.4 years |
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2 (10 years) |
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57,790 |
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434 |
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3,696 |
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3,910 |
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2 |
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$ |
66,790 |
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$ |
496 |
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$ |
4,271 |
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(1) |
Acquisitions will be accounted for as asset acquisitions in accordance with ASC 360. The figures above represent only costs paid or accrued for as of the date of this filing. |
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(2) |
Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the applicable lease, as required under GAAP, and excludes contingent rental payments, such as participation rents. |
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(3) |
In connection with the acquisition of this property, we executed a 6-year, follow-on lease with a new tenant that begins upon the expiration of the 4-month lease executed on the date of acquisition. The follow-on lease includes one, 4-year extension option and provides for minimum annualized straight-line rents of approximately $606,000.
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(4) |
As partial consideration for the acquisition of this property, we issued 288,303 OP Units, constituting an aggregate fair value of approximately $3.3 million as of the acquisition date.
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| Operating Leases of Lessor, Leasing Activity |
The following table summarizes certain leasing activity that occurred on our existing properties during the six months ended June 30, 2019 (dollars in thousands, except footnotes):
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PRIOR LEASES |
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NEW LEASES |
Farm
Locations |
Number
of
Leases
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Total
Farm
Acres
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Total
Annualized
Straight-line
Rent(1)
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# of Leases
with
Participation
Rents
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Lease
Structures
(# of NNN
/ NN)(2)
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Total
Annualized
Straight-line
Rent(1)
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Wtd. Avg.
Term
(Years)
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# of Leases
with
Participation
Rents |
Lease
Structures
(# of NNN
/ NN)(2)
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FL |
1 |
547 |
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$ |
143 |
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0 |
0 / 1 |
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$ |
156 |
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6.0 |
0 |
0 / 1 |
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(1) |
Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the applicable leases (presented on an annualized basis), as required under GAAP, and excludes contingent rental payments, such as participation rents. |
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(2) |
“NNN” refers to leases under triple-net lease arrangements, and “NN” refers to leases under partial-net lease arrangements. For a description of each of these types of lease arrangements, see “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Leases—General.”
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| Schedule of Finance Activity |
Our borrowings as of June 30, 2019, and December 31, 2018, are summarized below (dollars in thousands):
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Carrying Value as of |
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As of June 30, 2019 |
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June 30, 2019 |
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December 31, 2018 |
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Stated Interest
Rates(1)
(Range; Wtd Avg)
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Maturity Dates
(Range; Wtd Avg)
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Notes and bonds payable: |
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Fixed-rate notes payable |
$ |
261,821 |
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$ |
247,249 |
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3.16%–5.70%; 3.97% |
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6/1/2020–12/1/2043; November 2031 |
Fixed-rate bonds payable |
90,629 |
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90,877 |
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2.80%–4.57%; 3.55% |
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12/11/2019–9/13/2028; November 2022 |
Total notes and bonds payable |
352,450 |
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338,126 |
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Debt issuance costs – notes and bonds payable |
(2,306 |
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(2,338 |
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N/A |
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N/A |
Notes and bonds payable, net |
$ |
350,144 |
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$ |
335,788 |
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Variable-rate revolving lines of credit |
$ |
100 |
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$ |
100 |
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4.59%–4.84%; 4.72% |
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4/5/2024 |
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Total borrowings, net |
$ |
350,244 |
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$ |
335,888 |
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(1) |
Where applicable, stated interest rates are before interest patronage (as described below). |
Subsequent to June 30, 2019, through the date of this filing, we have secured the following new financings (dollars in thousands):
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Issuer |
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Date of
Issuance
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Amount |
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Maturity
Date
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Principal
Amortization
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Interest Rate Terms(1)
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Rabo AgriFinance, LLC(2)
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7/10/2019 |
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$ |
5,514 |
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6/1/2029 |
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25.0 years |
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One-month LIBOR plus 1.750% |
GreenStone Farm Credit Services |
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7/11/2019 |
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1,609 |
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8/1/2044 |
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25.0 years |
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5.00%, fixed through June 30, 2029 (variable thereafter) |
GreenStone Farm Credit Services |
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7/11/2019 |
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3,060 |
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8/1/2044 |
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25.0 years |
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5.00%, fixed through June 30, 2029 (variable thereafter) |
Farm Credit West, FLCA |
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7/11/2019 |
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5,400 |
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5/1/2044 |
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24.5 years |
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4.24%, fixed through July 31, 2026 (variable thereafter) |
Farm Credit of Central Florida, ACA |
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7/22/2019 |
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31,850 |
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7/1/2027 |
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25.2 years |
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5.05%, fixed throughout term |
Farm Credit of Central Florida, ACA |
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7/22/2019 |
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5,850 |
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7/1/2027 |
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None
(interest only) |
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5.05%, fixed throughout term |
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(1) |
Stated rate is before refunded interest, or interest patronage (as described further in Note 4, “Borrowings,” in the accompanying notes to our condensed consolidated financial statements).
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(2) |
In connection with this loan, we entered into an interest rate swap agreement that will result in an effective fixed interest rate of 4.04% for this loan throughout its term.
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| Monthly Distributions Declared by Company's Board of Directors |
On July 9, 2019, our Board of Directors declared the following monthly cash distributions to holders of our preferred and common stock:
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Issuance |
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Record Date |
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Payment Date |
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Distribution per Share |
Series A Term Preferred Stock: |
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July 22, 2019 |
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July 31, 2019 |
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$ |
0.1328125 |
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August 20, 2019 |
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August 30, 2019 |
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0.1328125 |
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September 17, 2019 |
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September 30, 2019 |
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0.1328125 |
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Total Series A Term Preferred Stock Distributions: |
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$ |
0.3984375 |
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Series B Preferred Stock: |
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July 24, 2019 |
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August 2, 2019 |
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$ |
0.125 |
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August 22, 2019 |
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August 30, 2019 |
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0.125 |
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September 24, 2019 |
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October 3, 2019 |
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0.125 |
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Total Series B Preferred Stock Distributions: |
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$ |
0.375 |
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Common Stock: |
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July 22, 2019 |
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July 31, 2019 |
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$ |
0.04455 |
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August 20, 2019 |
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August 30, 2019 |
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0.04455 |
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September 17, 2019 |
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September 30, 2019 |
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0.04455 |
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Total Common Stock Distributions: |
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$ |
0.13365 |
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