Flood Plain Land Investment

Kevin Van Trump discusses investing in lower-grade agricultural land, betting on technological advancements that will make this land more valuable in the future. The strategy leverages the investments being made by major foundations into agricultural technology for developing nations.

Key Points:

• Target Land Type:

  • Focus on B and C grade ground
  • Look for land in flood plains
  • Seek water-deficient areas
  • Avoid premium farmland like Iowa/Illinois

• Investment Thesis:

  • Major foundations (Gates, Buffett) are investing heavily in technology to improve poor soil
  • These technologies will eventually make lower-grade land more productive
  • Technology originally meant for 3rd world countries will benefit this land

• Current Market Context:

  • Premium farmland (Iowa/Illinois) has the richest soil
  • Premium land requires minimal improvement
  • Price per acre ranges significantly:
    • Regular farmland: $5,000-15,000 per acre
    • Premium locations: Up to $20,000 per acre

• Investment Structure Options:

  • Direct purchase of land
  • Fractional ownership through platforms like AcreTrader
  • Revenue sharing arrangements with local farmers
  • Typical holding period: 10-15 years for appreciation

• Return Drivers:

  • Long-term land appreciation
  • Annual farming revenue
  • Technology improvements increasing yield