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Dirt Capital Partners invests private capital in farmland i Dirt Capital Partners invests private capital in farmland i

Dirt Capital Partners invests private capital in farmland i - PowerPoint Presentation

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Dirt Capital Partners invests private capital in farmland i - PPT Presentation

Farmers sign a 9year lease with a fixed price purchase option after 5 or 6 years and at the end of the lease term The goal of each project is transfer of the farm to the farmer We work with local partners land trusts University extension services technical service providers agri ID: 612648

farm capital farmers loan capital farm loan farmers 000 financing project farmer california land direct million fsa purchase cdfi

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Slide1

Dirt Capital Partners invests private capital in farmland in the Northeast United States, facilitating farmland access and security for sustainable farmers with viable businesses.Farmers sign a 9-year lease with a fixed price purchase option after 5 or 6 years, and at the end of the lease term. The goal of each project is transfer of the farm to the farmer.We work with local partners – land trusts, University extension services, technical service providers, agricultural lenders – to position the project for long-term success.

INVESTING IN FARMLAND WITH GOOD FARMERSSlide2

12 FARMS PURCHASED SINCE 20146 Organic Dairy5 Diversified

1 Small Grains

2,000 acres totalSlide3

Relocate an existing farm to a more secure or larger propertyExpand a successful operation by acquiring nearby landTransfer a farm to non-family or family

successors

Conserve when land trusts look to partner with a like-minded organization

Transform

a farm with infrastructure updates for the next generation’s

efficiency

COMMON PROJECT THEMESSlide4

Organic practices, certification not requiredNew England, New York, New Jersey$100,000+ in annual gross revenue projected2+ years of sales, or prior farm management experience and purchasing an established businessProject acquisitions range roughly $200,000-1M

FARMER AND PROJECT CRITERIASlide5

PROJECT PROFILEMoxie Ridge Farm & Creamery Argyle, NY45-Acres of Pasture/Woods, Farmhouse, OutbuildingsCreating a Diversified Livestock, Farmstead Cheese and Agritourism

Operation

Purchase and Expansion of an Existing, Operating Business from a Retiring Farmer Couple

Multiple Project Technical Assistance and Financing Partners: Hudson Valley Agribusiness Development Corporation, American Farmland Trust,

GrowNYC

, Agricultural Stewardship Association, USDA-FSA Slide6
Slide7
Slide8
Slide9
Slide10
Slide11
Slide12

12California FarmLinkSlide13

13

California

FarmLink

links

independent farmers and ranchers to the land and financing they need for a sustainable future.

California

FarmLink

offers training and technical assistance related to land, capital and succession.

A Community Development Financial Institution (CDFI)

Filling the capital gap for farms and ranches in California, with a focus on beginning, immigrant and minority, direct-market and alternative production systems

Initial focus of lending was operating capital; financing for purchase and refinance of land began in 2015Slide14

CDFI provides structure to:Pool capital from diverse sourcesMitigate risks traditional lenders don’t have an appetite forIntegrate “development services” for deal development, risk mitigation and servicing over the life of the loanSlide15

FarmLink’s Path to becoming a CDFI

15

Farmer Education and TA organization founded in 1999

Through provision of education and TA focused on preparing for financing and loan packaging assistance, learned just how limited the options were for small, beginning and immigrant farmers.

2005- 2006 raised $1 million for loan fund

2006 – 2011 loans underwritten and serviced through Cal Coastal, a local, ag-focused CDFI

2011 began direct lending

2013 became Certified CDFI through

Dept

of Treasury

2017 $4 million available to lend

2016 $2.3 million in loan volume

2017 $3.5 million projected in loan volumeSlide16

Access to Capital16“You guys were literally our only option. You didn’t just lend us money, but you understood our perspective, and guided and taught us in the process as well.” – Farmer-BorrowerFarmLink’s

168 loans have supported more than 75 farmers across California. Impacts include:

764 jobs sustained and 196 new jobs created30% average annual increase in gross business revenue

10% average annual increase in family income

More than 85% of borrowers are certified organic farmers.Slide17

17Financing Criteria3 years operating experienceGaps

Price

Down Payment

Experience

Financial Records

Expansion/Projection-based

Succession

Risk profile

Adequate Debt Service Coverage

Deals to Date

Purchases (3)

Participating Lenders (3)

Succession (1)

Down Payment Program (2)

Refi’s (1)

Conventional Residential Mortgage

U

nable to secure financing elsewhereSlide18
Slide19

19JSM OrganicsDiverse organic farmStarted in 2012 by Javier ZamoraOperating on 40 acres across 3 parcels prior to purchaseDirect to consumer and direct to retail marketsProperty: ALBA’s Triple M Ranch

195 acres, 60 farmableNatural Resource & Ag Easement, held by Elkhorn Slough Foundation, conveyed with title

5-7 small farmer tenants continued under new ownershipSlide20

20Deal Profile$1.3 million asking pricePartnerships and Capital Stack Critical to DealCapital StackFSA Down Payment Program

5% down

$300,000 FSA Direct Farm Ownership Loan$650,000

FarmLink

FSA Guaranteed Loan

$250,000 RSF Social Finance Loan

Partnerships

Kitchen Table Advisors

FSA

RSF

ALBA