Why Farmland Ownership is Beneficial To Your Investment Portfolio in 2022.

Owning farmland is no longer a luxury exclusive to the super-rich in society. For several investment-oriented individuals, keeping a diversified and less volatile portfolio is the best form of investment. The primary goal of anyone investing in tangible or portfolio assets is to maximize returns for a given amount of risk.

Farmland has proven to be a superior asset class that has delivered excellent returns with relatively less risk or volatility, and there are additional benefits that farmland adds to the overall diversification of most portfolios. However, although farmland is an attractive asset class from an absolute return’s perspective, it is one of the least understood due to historical market constraints.

Studies show that farmland ownership can be an attractive component of a long-term investment strategy. Relative to adding just real estate to a portfolio, farmland improves both the average annual return and the risk-adjusted return of an investment portfolio.

 

Owning farmland differs from investing in food or agricultural commodities, and the two should not be confused. While your land continues to appreciate, items from the ground may be exposed to short-term volatility. Still, the net benefit of land ownership and farming activities is a more stable income earning potential.

 

Greenhills Cassava Farmstead is positioned to help you achieve a very stable portfolio by managing your farmland and carrying out commercial farming operations on your behalf. We also guarantee off-take at existing market prices to keep your land earning income for you while providing stable returns, all things being equal on proceeds.

 

 Challenges of Owning Farmland and How Greenhills Manages These Concerns

There are several barriers to entry that make it difficult for regular folk to undertake investments in tangible assets, particularly in farmland.

 

1. Lack of Transparency: We provide our farm owners with details of our dealings from when an offer is sent till all documentation
requirements are met. We encourage our farm owners to do their due diligence by even sending representatives to inspect and verify ownership of farmlands available for sale. We are also available to our farm owners through all communication channels within our reach and access to farm managers. Through our web/mobile application scheduled for launch in August, our farm owners will get operational updates in real-time on the platform.

 

 

2. Capital Requirements: Cost of investing in infrastructure to operate and maintain farmland is intensive for the individual. Greenhills Cassava Farmstead through it’s commercial farming model gives individuals the opportunity to own serviced cassava farmland at a fraction of the cost to operate at scale.

 

3. Operational Risks: Investing in farmland involves a range of operational risks: weather, security of ownership, and compliance with local regulations. We address all these concerns through our decision to cultivate resilient varieties to adverse weather conditions, pests and diseases, providing legal documents to secure property ownership, and providing information about local regulations before farmland purchase to non-citizens of Nigeria and otherwise. We manage farm operations down to harvesting and sales of proceeds, effectively protecting our farm owners from the operational challenges of operating farmland. 

 

Our first scheme in Olorunsogo is sold out, and the second scheme with C-of-O is now available for sale in Ihunbo town (Ado-Odo Ota LGA) of Ogun State, Nigeria. See the poster below for details.