Episode #161: Brandon Zick, “In Row Crops You’re Producing A Lot Of Present Earnings”
Visitor: Brandon Zick focuses on managing all property of the farm portfolio, performing valuation evaluation and due diligence of property acquisitions, deal sourcing and negotiating acquisition phrases, tenant sourcing and ongoing relationship administration and oversees all portfolio administration of the Fund.
Date Recorded: 6/5/19
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Abstract: In episode 161, we welcome our visitor, Brandon Zick. Brandon begins speaking about his background in farming, and the present possession construction he’s seeing within the farm enterprise; land possession and operations are a technology or two eliminated, which creates a sturdy rental market, and what makes funding doable.
Meb asks Brandon why traders ought to think about farmland of their funding portfolios. Brandon discusses the tangibility of proudly owning an actual asset equivalent to farmland, the inflation hedge it offers, and its potential to diversify a portfolio.
Subsequent, Brandon will get into the structural inefficiencies of the farmland market, and the chance/return profile it may well present traders.
Meb then asks concerning the possession construction of their investments. Brandon talks about Ceres shopping for land from absentee land homeowners, their aim of partnering with high decile farmers, and placing extra incentives in place for his or her tenants. He additionally mentions the farmer relationship and involving them within the underwriting course of when buying farms.
The dialog then turns to some historical past on the farmland bust part within the 80s, and the way leverage within the system contributed to that surroundings, however has additionally influenced how individuals purchase and personal farmland right now.
Brandon then goes on to elucidate why traders ought to embrace volatility, and the way essential it’s as a land proprietor to have fairness in land and money in hand to have the ability to make acquisitions and develop.
Because the dialog winds down, Meb asks Brandon about his ideas on expertise and it’s impacts in agriculture. Brandon talks about it being an thrilling growth, permitting farming to be much less labor intensive and releasing farmers to make increased worth, broad scale selections.
Brandon wraps up with a dialogue of Ceres’ fund, and what’s on the horizon for Ceres.
All this and extra in episode 161, together with a dialogue about what retains Brandon up at evening and what he’s notably enthusiastic about, in addition to his most memorable funding.
Hyperlinks from the Episode:
- 0:50 – Welcome to our visitor, Brandon Zick
- 1:38 – Brandon’s background on a dairy farm
- 2:34 – Modifications within the farming panorama
- 4:55 – Brandon’s background in finance
- 6:09 – Brandon’s transfer to Ceres
- 7:23 – The case for investing in farming
- 9:15 – Defining row crops
- 11:03 – How Ceres partnerships work
- 14:21 – Course of for evaluating farms
- 16:21 – Institutional traders shifting into the house
- 20:08 – The inefficiencies of this market
- 24:40 – Enhancing farms
- 27:57 – Historic returns and alternatives for farming
- 33:24 – Advantages of volatility in farming
- 36:54 – Leverage in farmland and ethanol manufacturing’s influence
- 38:26 – Meb’s farmland tweet
- 41:52 – Expertise within the farming house and what it means for the workforce
- 42:10 – Farmers Plow Via Netflix Whereas Plowing Fields
- 46:24 – Worth add for the farmers to work with Ceres
- 51:02 – Balancing the liquidity on this illiquid asset class
- 56:01 – Various alternatives with farmland
- 1:01:40 – How the fundraising pitch to traders has modified through the years
- 1:08:28 – Ceres’ capability
- 1:10:09 – Growth plans
- 1:14:03 – Startup tech within the house
- 1:18:39 – Looking forward to issues on the horizon that excites or frightens Brandon
- 1:24:45 – Most memorable funding
- 1:28:03 – Observe Brandon, cerespartners.com
Transcript of Episode 161: