Release Date: February 20, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: Can you clarify the comments on the participation and fixed base rents amendment? Is the $3 million to $3.5 million lower fixed base rent compared to what was reported in 4Q? A: No, it's more about the average base rent for the year in 2024 versus 2025. It's not a comparison between Q4 and the future; rather, it's an annual average comparison.
Q: Regarding the sale of the Florida farm, what was the use of the remaining proceeds after paying off some debt? A: The remaining proceeds are part of the $50 million cash on hand on the balance sheet, held for other uses at this point.
Q: What are your expectations around interest patronage in the first quarter? A: We expect a similar percentage back from farm credit borrowing, but since we've paid off about 10% of those loans over the past year, the patronage might be about 10% less.
Q: Can you provide more details on the lease expirations this year, particularly the split between permanent and row crop leases? A: In the next six months, most expiring leases are row crop farms, which are a small percentage. In the second half of the year, 60% to 70% of expiring leases are on permanent crop farms, some with lease incentives and high upside on crop share.
Q: Given the current trading price of preferred stock, do you anticipate continuing to buy back preferred shares? A: Yes, it's an easy way for us to make money, and we plan to continue buying back preferred shares.
Q: Is the property operating expense in 4Q a good run rate for the remainder of the year, or are there factors that could cause it to change? A: We hope it comes down a bit due to the sale of Michigan Blueberry properties, which contributed to the increase. Some legal costs will remain, but overall, expenses should decrease.
Q: What percentage of the California portfolio is on the crop share, high upside lease structure, and what's the outlook for these assets? A: Currently, five farms are on this hybrid structure, making up about 15% of the California portfolio's fair value. We expect to keep the rest in the traditional lease structure.
Q: With the NAV decision, will NAVs be provided regularly, or is the intention to stop providing them due to cost? A: The cost and reliability of external valuations have become burdensome, so we may stop providing NAVs regularly. We will reassess and possibly provide internal estimates in the future.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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