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Real Estate and Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2024

The following table provides certain summary information about the 168 farms we owned as of March 31, 2024 (dollars in thousands, except for footnotes):


Location	No. of Farms	Total Acres	Farm Acres	Acre-feet of Water Assets	Net Cost Basis(1)		Encumbrances(2)
California(3)(4)(5)	63	34,844	32,321	49,076	$	846,399	$	385,369
Florida	25	18,720	13,891	0	167,060		78,143
Washington	6	2,520	2,004	0	58,847		20,076
Arizona(6)	6	6,320	5,333	0	51,445		12,059
Colorado	12	32,773	25,577	0	45,847		14,318
Nebraska	9	7,782	7,050	0	30,403		10,135
Oregon(7)	6	898	736	0	29,429		11,237
Michigan	23	1,892	1,245	0	22,830		13,694
Texas	1	3,667	2,219	0	8,082		—
Maryland	6	987	863	0	8,019		4,282
South Carolina	3	597	447	0	3,519		2,124
Georgia	2	230	175	0	2,593		1,623
North Carolina	2	310	295	0	2,107		—
New Jersey	3	116	101	0	2,085		1,221
Delaware	1	180	140	0	1,293		687
	168	111,836	92,397	49,076	$	1,279,958	$	554,968

(1)Consists of the initial acquisition price (including the costs allocated to both tangible and intangible assets acquired and liabilities assumed), plus subsequent improvements and other capitalized costs associated with the properties, and adjusted for accumulated depreciation and amortization. Specifically, includes Total real estate, net (excluding improvements paid for by the tenant) and Lease intangibles, net; plus long-term water assets and related acquisition costs, net above-market lease values, lease incentives, and investments in special-purpose LLCs included in Other assets, net; and less net below-market lease values and other deferred revenue included in Other liabilities, net; each as shown on the accompanying Condensed Consolidated Balance Sheets.

(2)Excludes approximately $2.8 million of debt issuance costs related to notes and bonds payable, included in Notes and bonds payable, net on the accompanying Condensed Consolidated Balance Sheets.

(3)Includes ownership in a special-purpose LLC that owns a pipeline conveying water to certain of our properties. As of March 31, 2024, this investment had a net carrying value of approximately $946,000 and is included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets.

(4)Includes eight acres in which we own a leasehold interest via a ground lease with a private individual that expires in December 2040 and five acres in which we own a leasehold interest via a ground sublease with a California municipality that expires in December 2041. As of March 31, 2024, these two ground leases had a net cost basis of approximately $680,000 and are included in Lease intangibles, net on the accompanying Condensed Consolidated Balance Sheets.

(5)Includes 46,003 acre-feet of water stored with Semitropic Water Storage District, located in Kern County, California, and 3,073 surplus water credits in our account with Westlands Water District, located in Fresno County, California. See “—Investments in Water Assets” below for additional information.

(6)Includes two farms consisting of 1,368 total acres and 1,221 farm acres in which we own leasehold interests via two ground leases with the State of Arizona that expire in February 2025 and February 2032, respectively. As of March 31, 2024, these ground leases had an aggregate net cost basis of approximately $293,000 and are included in Lease intangibles, net on the accompanying Condensed Consolidated Balance Sheets.

(7)Includes ownership in a special-purpose LLC that owns certain irrigation infrastructure that provides water to two of our farms. As of March 31, 2024, this investment had a net carrying value of approximately $4.7 million and is included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets.

Schedule of Components of Investments in Real Estate

The following table sets forth the components of our investments in tangible real estate assets as of March 31, 2024, and December 31, 2023 (dollars in thousands):


	March 31, 2024		December 31, 2023
Real estate:
Land and land improvements	$	792,310	$	792,277
Permanent plantings	358,535		359,131
Irrigation and drainage systems	169,639		168,545
Farm-related facilities	50,508		50,517
Other site improvements	13,236		13,272
Real estate, at cost	1,384,228		1,383,742
Accumulated depreciation	(149,608)		(142,212)
Total real estate, net	$	1,234,620	$	1,241,530

Schedule of Carrying Value of Lease Intangibles and Accumulated Amortization for Each Intangible Asset or Liability Class

The following table summarizes the carrying values of certain lease intangible assets and the related accumulated amortization as of March 31, 2024, and December 31, 2023 (dollars in thousands):


	March 31, 2024		December 31, 2023
Lease intangibles:
Leasehold interest – land	$	3,372	$	4,295
In-place lease values	2,470		2,470
Leasing costs	3,017		3,017
Other(1)	140		141
Lease intangibles, at cost	8,999		9,923
Accumulated amortization	(4,449)		(5,141)
Lease intangibles, net	$	4,550	$	4,782

(1)Other includes tenant relationships and acquisition-related costs allocated to miscellaneous lease intangibles.

The following table summarizes the carrying values of certain lease intangible assets or liabilities included in Other assets, net or Other liabilities, net, respectively, on the accompanying Condensed Consolidated Balance Sheets and the related accumulated amortization or accretion, respectively, as of March 31, 2024, and December 31, 2023 (dollars in thousands):


	March 31, 2024				December 31, 2023
Intangible Asset or Liability	Deferred Rent Asset (Liability)		Accumulated (Amortization) Accretion		Deferred Rent Asset (Liability)		Accumulated (Amortization) Accretion
Above-market lease values and lease incentives(1)	$	5,781	$	(2,484)	$	5,342	$	(1,849)
Below-market lease values and other deferred revenue(2)	(1,944)		665		(1,944)		624
	$	3,837	$	(1,819)	$	3,398	$	(1,225)

(1)Net above-market lease values and lease incentives are included as part of Other assets, net on the accompanying Condensed Consolidated Balance Sheets, and the related amortization is recorded as a reduction of Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.

(2)Net below-market lease values and other deferred revenue are included as a part of Other liabilities, net on the accompanying Condensed Consolidated Balance Sheets, and the related accretion is recorded as an increase to Lease revenue, net on the accompanying Condensed Consolidated Statements of Operations and Comprehensive Income.