Olives: A New Crop Market for AcreTrader
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This article was edited to meet broker-dealer compliance guidelines in April of 2023.
On November 10, AcreTrader successfully launched and funded its first olive offering to investors: the Tehama Olive Ranch. The Ranch is an established 246 gross acre property in Tehama County, California containing a mature, 150-acre high density olive orchard planted in 2010. Additionally, the property also has 60 acres of walnuts planted between 2010 and 2015. This $4 million investment opportunity fully subscribed in just over two hours, demonstrating investor interest in mature, producing orchard investments with secure water resources.
For permanent crop investments like fruit and nut orchards, AcreTrader partners with experienced and expert operators who want to grow their business and increase the acreage they farm. AcreTrader works as a capital partner for these growers, whom we call the "sponsors" of our projects.
The sponsor is really the quarterback of these partnerships: they find the opportunity, negotiate and enter a contract on the property, and compile financial projections for the investment. While securing the property, the sponsor sets up a new LLC to complete the purchase and receive investor funds. They also co-invest a small percentage of equity alongside investors on the AcreTrader platform while maintaining full operational control as the Managing Member of that new entity. We, AcreTrader, connect them with passive investor capital. These investors benefit from annual returns from the farming operation, and both the sponsor and investors participate in net profits from the farm and eventual proceeds from the sale of the property.
We like this sponsored offering structure for permanent crops because it aligns incentives well and pairs experienced growers with accredited investors wanting access to a new asset class. Our sponsors are the true experts in the field. We give these individuals the opportunity to farm more acreage, choose the acreage on which they operate, maintain full autonomy through the life of the project, and most importantly, to hold an ownership stake in the land they farm.
For this investment, AcreTrader partnered with Adam Englehardt, a well known farmer and olive oil industry leader in California. From 2008 to 2014, Englehardt managed California Olive Ranch’s expansion from 500 to 10,000 planted acres. In 2014, he became President and CEO of the newly formed Boundary Bend Olives Inc., the U.S. subsidiary of Australia’s Boundary Bend Limited (now known as Cobram Estate). At the time of his departure in 2019, Boundary Bend had grown to the third largest olive oil handler in CA and the fastest growing CA olive oil brand in supermarkets.
Since 2019, Englehardt has operated his own firm specializing in the development, management, and harvest of super high-density olives for olive oil. He serves as the Vice Chairman of the California Department of Agriculture-mandated Olive Oil Commission of California (OOCC) and is the chairman emeritus of the American Olive Oil Producers Association, which represents domestic olive growers at the federal level.
We’re proud to partner with Adam on the Tehama Olive Ranch, and look forward to future opportunities to grow with him.
Want to grow with us too? Reach out to our Farm Team at (479) 335-5660 to learn more about how we can partner with you.
The above content is not intended to be a comparison between products, but is intended for general, educational and informational purposes only. Any performance noted is historical and there is no guarantee any trends will continue. All investing involves risks, including the complete loss of principal. Diversification does not guarantee a profit or protect against loss in a declining market. It is important for each investor to review their investment objectives, risk tolerance, tax liability and liquidity needs before investing. Investment vehicles have differences in fee structure, risk factors and objectives. Investments are considered speculative, involve a high degree of risk and therefore are not suitable for all investors.
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