Ag land sales going up
Pallavi Agarwal | Highlands TodaySEBRING - There was a time, not too long ago, when developers and speculators gobbled up big tracts of ag land, even forking out $30,000 for an acre, to build homes that never got built.
Published: November 29, 2012
Published: November 29, 2012
Some were citrus groves, which went fallow; others were pasture land and ranches. On some, developers even installed water and sewer facilities for future homes.
Then real-estate prices plummeted, and agricultural land value went down with it. A survey by the University of Florida's Institute of Food and Agricultural Sciences showed rural land prices in 2008 tumbling by almost half in some cases the following year.
Rodney Clouser, the UF professor of food and resource economics who led the survey, described some of properties being sold at that time as a "firesale."
Now, sales of groves and ranches are picking up, and they are being repurchased for what they were intended for, agricultural and citrus use, according to the Lay of the Land Market Report, which analyzes Florida's land market.
Coldwell Banker Commercial Saunders Real Estate of Lakeland, which compiles this new report, standardized data from different property appraisers across the state.
While the number of sales for grove land has increased in the last few months, listings for average and lower-quality groves in the area also have also gone up, the report states.
Greg Karlson, broker and owner of ERA Advantage Realty, is seeing this happen in Highlands County.
Buyers – some even as far as Venezuela and Brazil – are buying agricultural land because the business of agriculture has been strong here, he said.
"Groves and ranches are on top of the list," he said. "Agriculture has been really good the last few years."
According to figures he pulled from the Multi-Listing Service, there were 26 ranches and farms that exchanged hands this year, for a total value of approximately $9.5 million.
Some were as big as a 784-acre tract that sold for $3.2 million. Another 9.19-acre tract sold for $6,000.
There were five groves that sold this year, according to Karlson's figures, from a 57.49-acre grove that went for $574,900 to a $5.5-acre one for $31,000.
It looks like most of the agricultural operations under new ownership are existing businesses.
Most of the grove sales he's seen are of existing citrus operations, said Chip Boring, owner and broker of REMAX/Realty Plus.
Some may be "basic groves" that require "rehabbing," but most are "existing producing groves" that are being sold either because the owner may be tired of the business or may not have the capital needed to continue with improvements or maintenance, he said.
Ray Royce, executive director of the Highlands County Citrus Growers Association, said he's heard of a new 5,000-acre grove being planted in DeSoto County.
"In Highlands County, no Ridge property is being converted to orange grove," he added.
The soil-rich property contiguous to U.S. 27 or the central part of Highlands County is typically categorized as the Lake Wales Ridge land.
For the most part, though, growers who want to expand don't typically go buy more land to plant new trees, Royce explained. Instead, they invest in smaller, high-yield trees that are replanted in existing groves to maximize value.
That, and citrus diseases such as greening and canker, are the reasons why citrus acreage has been declining in Florida even though more citrus land may be getting sold.
According to the United States Department of Agriculture, Highlands County had citrus planted on 62,440 acres in 2011, a slight decline from 2008's 62,599 acres.
The amount of abandoned grove land also went up slightly from 2,393 acres in 2010 to 3,240 acres in 2012.
Citrus grower Bobby Barben said he's heard of two or three groves being rehabilitated.
Barben is not expanding but continuing with his "ongoing replanting program."
Agriculture faces the vagaries of Mother Nature more than most other businesses.
The deluge that hit Highlands County in September and October may have caused some fruit to drop early this year. He said.
Three months ago Barben was feeling a "lot better" about his trees. Now, he's not sure if they are looking that healthy.
"I'm cautiously optimistic," he said about this growing season and next. "We are going to keep doing as good a job as we can possibly do."
"I won't borrow a lot of money to go plant a grove," he added.