Thursday, November 14, 2019

"Lifestyle Farming Is the Latest Addictive Hobby for Banker Types"

Can any of these newbs match Crispin Odey's Palladian chicken coop?

Drawings for Crispin Odey’s “chicken house” depicted a structure with a three-sided stairway and two dozen columns.
Drawings for Crispin Odey’s “chicken house” depicted a structure with a three-sided stairway and two dozen columns. 
(note bird lower left)

HT: FT Alphaville's "Crispin Odeyous".

From Bloomberg Businessweek, November 7:
During the week, Chris Andersen runs his Manhattan investment banking firm, G.C. Andersen Partners LLC, from behind a desk that’s a replica of one owned by Lorenzo de’ Medici. On the weekends, he heads to his farm in New Jersey, where he shovels out corn cobs and bruised watermelons to feed his herd of Mangalitsa hogs, an especially tasty breed of pig from Hungary.

Andersen, 81, calls himself the Colonel Sanders of the Mangalitsa. He started his farm more than a decade ago on a lark. It’s since turned into a passion, one that’s produced 4,000 pigs across seven farms in three states. He employs three full-time farmers and has even built a facility in Pennsylvania to produce charcuterie that he sells under the American Mangalitsa brand.

Unlike investment banking, the farms are unprofitable. Andersen estimates he’s spent in the low seven figures each year for the last 10 years on them and is now at about break-even before capital expenditures. “Being a farmer is a lot more complicated than most people realize,” he says.

Although he may be doing it in a more expensive fashion than most, Andersen is part of a growing “lifestyle farming” trend. It’s a hobby that wealthy Americans have been devoting nights and weekends to over the past few decades, says Rhonda Skaggs, an emeritus professor of agriculture economics at New Mexico State University. These individuals subsidize their hobby with other work, often in a nearby city. While a few thousand farms generate the lion’s share of U.S. food production, there are millions of small ones in the country. According to the Department of Agriculture, 41% of farms in the U.S. are modest affairs whose operators have a primary occupation other than farming.
Houston-based tractor maker Mahindra North America sees lifestyle farming as the fastest-growing of all its markets. Ryan Pearcy, a senior product manager at the company, says it forecasts the segment will expand by about 10% a year for the next decade. There are a few obvious causes for the increase, starting with the wave of still-active baby boomers who are entering retirement. Also, in general, more Americans are interested in growing their own food.

“Many people would like to live in the countryside, have some horses or own a few acres, have the lifestyle, even though their primary occupation is something else,” says Eric Hansotia, chief operating officer of Agco Corp., one of the world’s biggest agriculture machinery companies.
As a hobby it can be quite expensive, but many of those on Wall Street have the means to be more extravagant with their projects, and owning farms and elaborate country houses is a tradition for the wealthy. In the U.S., there are also tax benefits to owning land that has an agricultural use—a commonly exploited loophole.

Christopher Dixon, a retired securities analyst at UBS AG, has been keeping livestock out on pasture for more than a decade. But in recent years he’s taken up a project that seeks to reinvent small-scale farming. He put together a group of investors and purchased Stone Acres Farm, a 63-acre property in Stonington, Conn., that dates to 1765. It offers a Community Supported Agriculture program, operates a space for events and dinners, and is open to visitors. Dixon calls the project an experiment “to see if we can come up with a way to sustain these farms in New England.”

Jon McConaughy was a Wall Street stalwart for two decades, most recently as a managing director at Credit Suisse Group AG, before a hobby farm he started in 2004 morphed into a second profession. Double Brook Farm LLC in Hopewell, N.J., came into being when he felt a pull to get back to the land....