Farmland Partners Inc. recently announced that its Board of Directors has approved a special one-time dividend of $1.15 per share of common stock and Class A Common OP Unit. This dividend will be paid in cash on January 8, 2025, to shareholders of record as of December 23, 2024. The announcement underscores the Company’s strong financial performance and strategic success during the year.
The year 2024 has proven to be a significant one for Farmland Partners. The Company successfully sold farmland and related assets, generating approximately $308 million in proceeds. This resulted in a total gain of $51 million, representing an impressive 20% premium over the aggregate net book value of the assets sold. These achievements demonstrate the effectiveness of FPI’s business model and its ability to capitalize on the inherent value of high-quality farmland.
“This year has been good for FPI,” stated Luca Fabbri, President and CEO of Farmland Partners. “The Company achieved sizeable profits on dispositions, trimmed operational expenses, reduced debt exposure, and increased rental rates on the farmland still within its portfolio – which is some of the best farmland in the world. This special dividend gives us an opportunity to share these successes in a meaningful way with our shareholders, further demonstrating the strength of farmland as an investment class and its historically consistent appreciation.”
The decision to declare this special dividend is also tied to FPI’s compliance with U.S. federal income tax regulations for real estate investment trusts (REITs). To maintain its REIT status, the Company is required to distribute a significant portion of its taxable income to shareholders. The $1.15 per share dividend was carefully calculated based on estimated operating performance for the year ending December 31, 2024, as well as anticipated sales expected to be completed by the end of the year. Additional factors, such as book-to-tax adjustments, were also considered in determining the final dividend amount.
Beyond the special dividend, FPI continues to deliver consistent returns to its shareholders. On October 29, 2024, the Company declared a regular quarterly dividend of $0.06 per share of common stock and Class A Common OP Unit. This quarterly dividend highlights FPI’s commitment to providing steady income to its investors, reflecting its strong underlying business fundamentals. Shareholders seeking more details on the quarterly dividend can refer to “Note 12—Subsequent Events” of the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2024. This report was filed with the U.S. Securities and Exchange Commission on October 31, 2024.
Farmland Partners’ performance in 2024 reflects its strategic focus on enhancing shareholder value while maintaining a robust and diverse portfolio of farmland assets. By actively managing its properties, optimizing rental agreements, and selectively disposing of assets, the Company has demonstrated its ability to adapt to market conditions and maximize returns. FPI’s portfolio includes some of the most productive farmland in the world, providing a reliable income stream and long-term capital appreciation potential.
The agricultural sector has long been recognized as a resilient and essential component of the global economy, and FPI’s results this year underscore the enduring value of farmland investments. The Company’s ability to consistently deliver strong financial performance, even amid broader economic uncertainties, highlights the stability and growth potential of this asset class. Farmland’s historical appreciation, coupled with its role in providing essential resources, makes it a compelling investment choice for both institutional and individual investors.
Looking ahead, FPI remains committed to its mission of enhancing value for its shareholders through strategic asset management and disciplined financial practices. The special dividend not only rewards investors for the Company’s strong performance in 2024 but also reaffirms its dedication to maintaining its REIT status and adhering to sound financial practices.
In conclusion, the declaration of the $1.15 per share special dividend marks a significant milestone for Farmland Partners. It reflects a year of strategic achievements, including successful asset sales, operational improvements, and financial discipline. As FPI continues to navigate the evolving agricultural landscape, its focus on delivering value to shareholders remains steadfast, reinforcing its position as a leader in the farmland investment sector.
