Farmland Secures Higher Debt Threshold from Farmer Mac

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Farmland Partners Inc. has expanded its secured note line of credit with Farmer Mac to $150 million, from $75 million, the company announced on Tuesday.

Taking advantage of the increased credit available to it, Farmland will issue a three-year, interest-only, 2.56% fixed-rate bond of $30.9 million. This will bring Farmland’s borrowings under this facility to a total principal amount of $81.1 million.

The bond will be secured by mortgage loans on agricultural real estate that Farmland owns. The mortgages have an effective loan-to-value ratio of up to 60%, according to Farmland.

Farmland also will acquire seven row-crop farms in South Carolina for $27.5 million and a 1,300-acre farm in Arkansas for $3.3 million. Those purchases bring Farmland’s total amount of acquisitions to 39,000 acres for $128 million since an initial public offering in April.

“The expansion of the secured purchase note facility with Farmer Mac is indicative of our strong relationship with a leading credit provider to the U.S. agricultural industry while giving us increased acquisition capacity heading into next year,” Luca Fabbri, Farmland’s chief financial officer, said in a press release.

“As previously discussed, we intend to maintain overall leverage of approximately 40% to 50%, based on current estimated values.”

Article source: http://www.nationalmortgagenews.com/news/secondary/farmland-secures-higher-debt-threshold-from-farmer-mac-1043453-1.html

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