Home | Wealth Management | Best long-term real estate play is…farmland?

Best long-term real estate play is…farmland?

By
Font size: Decrease font Enlarge font
Best long-term real estate play is…farmland?

According to a recent report from CNBC.com, dirt is where it’s at.

CNBC.com recently reported on a long-term investment opportunity that’s as old as dirt.

The combination of still-growing world population and declining arable land makes for some attractive long-term economics.Well, actually, it is dirt.

From his office on Broad Street in lower Manhattan, Jeff Notaro oversees a modest portfolio consisting mainly of dirt. Specifically, Notaro's Black Sea Agriculture fund invests in farmland in northeastern Bulgaria, near the Black Sea. The $1.5 million fund buys prime agricultural land and leases it back to local farmers.

Notaro is riding a growth market. Since 2004, Bulgarian farmland has been appreciating at an average annual rate of 19 percent. Yet Bulgarian land is still cheap compared to the United States. The average price per acre for good-quality land is $1,850 in Bulgaria versus $5,000 an acre in Kansas.

Share this:

According to the report, the combination of a still-growing world population and declining arable land makes for some attractive long-term economics. The article points out that world population is projected to top out at 9 billion people in 2050, a 28% increase from the current 7 billion, while at the same time per capita arable land will decrease almost 17% during that period.  Unless the law of supply and demand is repealed (or, more likely, unless technological advances dramatically increase yields), it makes sense that farmland will become increasingly valuable over the next few decades.

1 2 »
Join PRESIDENT&CEO on LinkedIn

Subscribe to comments feed Comments (0 posted)

total: | displaying:

Post your comment

  • Bold
  • Italic
  • Underline
  • Quote

Please enter the code you see in the image:

Captcha