Private real estate investment trust (REIT) Goldcrest Farm Trust (GFT) announced it has secured more than $300 million in capital commitments from a collective of leading institutional pension fund investors for its second investment vehicle. Although the specific pension funds have not been named, it is known that the Ontario Teachers Pension Plan has invested in Goldcrest in the past.
This funding brings the REIT’s total long-term capital managed across both of its vehicles to over $600 million.Here's the press release, October 15:
Privately held and launched originally under the name U.S. Farm Trust in 2015, Goldcrest Farm Trust is managed by Goldcrest Farm Trust Advisors (GFTA), which focuses exclusively on building and managing GFT’s farmland portfolio....MORE
Goldcrest Farm Trust Closes on Additional $300 Million in Pension Fund Commitments
For what it's worth, Ontario Teachers is one of the behemoths ($200 billion assets) so even if they subscribed the whole offering it would hardly move the needle.
The performance of the two publicly traded farm REITS (there had been three until FPI bought AFCO in 2016) has ranged from boring to disastrous, depending on your time frame:
We had been using the public REITs as an over/under-valuation monitor for private farmland:
From a July 2014 post:
...Gladstone Land is the other publicly traded vehicle. There a a few private partnerships that let in outsiders.They did the IPO on October 19, 2015.
In February 2011 I noted:
...We've been following this trend for the last three years and have been asked when will it top?One sign will be when Optima Fund Management brings their American Farmland Company public, still a few years away....Optima have not yet made the move, and have been correct to keep the cash flow and cap gains to themselves but I have a feeling we are getting close....
And we haven't had much interest in the sector since.
That may be about to change with the Goldcrest fundraising and the apparent bottom in Farmland Partners earlier this year. Stay tuned.
Related June 2019
Back to the Future: "Wealthy families are adding forests to their portfolios"
We've noted the ebbs and flows of the real asset trade over the years and think it's probably time for a revisit.
If interested see also:
Grantham, Mayo, Van Otterloo: "A Farmland Investment Primer"
Or the glitz.
Or the glamor....
And
Previously in the Paul Bunyan series:
"A Fine Time for Timber" (WY)
There are a half-dozen ways to invest in timberland, the REIT's being one of them. Unfortunately for non-institutional investors there are no pure play portfolio investments and neither the ETF's (CUT; WOOD) nor the REIT's are perfect proxies for timber. POPE Resources is set up as a Master Limited Partnership with a higher correlation to timberland. A couple of London traded vehicles, Phaunos Timber and Cambium Global Timberland Limited also have higher correlation to timberland."Investing in Timber and Farmland"
If you can do direct investments the Timberland Management Organizations (TIMO's) will get you even more correlation with Forestland Group (3.5 MM acres) Campbell Resources (3.1 MM acres) and Hancock Timber Resources Group ( 6.5MM under management) being the largest.
