How does FarmPath work?

How does FarmPath work?

FarmPath is a farmer-focussed opportunity for dairy farmers to lease and part-own a farm. Approved dairy farmers will select and lease a farm on a pathway to farm ownership. Farmers are co-investors in the farm, alongside FarmPath’s institutional investors.

FarmPath farmers get the opportunity to select a quality farm and make improvements so it is productive and efficient from the start. As farmers increase their ownership stake and improve the farm’s value, they grow their farm equity. Then, after eight years, farmers have the opportunity to buyout the FarmPath investors.

How FarmPath Works

  • Farmers have an ownership stake in the leased farm alongside FarmPath’s investors.
  • Farmers have an option to increase their ownership stake at the original purchase price.
  • After 8 years, the farmer will have the opportunity to buy-out the FarmPath investors.

The farmer’s initial farm ownership stake is expected to be 5% or more, depending upon the amount of initial capital they have to invest.

The farmer leases the farm for an 8-year term, receiving lease dividends back in proportion to their ownership stake.

Within the farm lease rate, the farmer is paying to hold the option to purchase a further ownership stake in the farm, at the original acquisition price.

At the end of the 8-year lease the farmer will have the opportunity to buy-out the FarmPath investors at the prevailing market price.

Farmers have the independence as lessees to operate their own farm business, while benefiting from a supportive relationship with the FarmPath investment team.

FPath diagram

 

 

 

 

Farmer and Farm Selection

FarmPath is seeking farmer partners who have:

  1. Ownership of 300+ dairy cow herd and dairy plant and equipment;
  2. Track record successfully running their own dairy farming business.

Farmers drive the farm selection process, guided by FarmPath to evaluate the farm’s suitability as an investment.