Company Overview
| Company Name |
GLADSTONE LAND CORP |
| Company Address |
1521 WESTBRANCH DRIVE
SUITE 200
MCLEAN, VA 22102 |
| Company Phone |
703-287-5800 |
| Company Website |
www.GladstoneLand.com |
| CEO |
David Gladstone |
| Employees (as of 10/7/2010) |
0 |
| State of Inc |
MD |
| Fiscal Year End |
12/31 |
| Status |
Withdrawn (8/6/2010) |
| Proposed Symbol |
-- |
| Exchange |
Nasdaq National Market |
| Share Price |
14.00-16.00 |
| Shares Offered |
12,100,000 |
| Offer Amount |
$222,640,000.00 |
| Total Expenses |
$1,300,000.00 |
| Shares Over Alloted |
1,815,000 |
| Shareholder Shares Offered |
750,000 |
| Shares Outstanding |
14,100,000 |
| Lockup Period (days) |
180 |
| Lockup Expiration |
-- |
| Quiet Period Expiration |
-- |
| CIK |
0001495240 |
We estimate that the net proceeds to us from this offering will be
approximately $ 157.0 million, assuming an initial public offering price of
$ 15.00 per share, which is the midpoint of the offering price range on the
cover of this prospectus ($ 182.4 million if the underwriters exercise their
over-allotment option in full), after deducting the underwriting discount and
estimated offering expenses payable by us. We expect to use the net proceeds
of this offering to buy agricultural and other real estate for lease to
tenants, to make loans secured by agricultural real estate and to make payments
to our Adviser pursuant to our advisory agreement. As of the date of this
prospectus, we do not have commitments to purchase any properties. We will
invest the net proceeds in accordance with our investment objectives and
policies. We will not receive any proceeds from the sale of shares by the
selling stockholder.
We estimate that it will take approximately 12 months for us to substantially
invest the net proceeds of this offering, depending on the availability of
appropriate opportunities and market conditions. Pending such investment, we
will primarily invest the net proceeds in securities that are not REIT-
qualified investments, as well as REIT-qualified investments such as money
market instruments, short-term repurchase agreements or other cash equivalents.
The non-REIT-qualified investments are expected to provide a current return
that will be greater than the REIT-qualified investments. We may also
temporarily invest in securities that qualify as “real estate assets” under the
REIT provisions of the Code, such as mortgage-backed securities. There can be
no assurance that we will be able to achieve our targeted investment pace.
A tabular presentation of our estimated use of the proceeds to us from this
offering, assuming no exercise of the underwriters’ over-allotment option, is
set forth below:
Amount Percentage
Gross offering proceeds $ 170,250,000 100.00 %
Less offering expenses:
Underwriting discounts $ 11,917,500 7.00 %
SEC registration fee $ 15,875 0.01 %
FINRA filing fees $ 23,140 0.01 %
NASDAQ listing fees $ 125,000 0.07 %
Printing and engraving expenses(1) $ 150,000 0.09 %
Legal fees and expenses(1) $ 700,000 0.41 %
Accounting fees and expenses(1) $ 150,000 0.09 %
Transfer agent and registrar fees(1) $ 25,000 0.01 %
Miscellaneous offering expenses(1) $ 110,985 0.07 %
Estimated net proceeds to us to be used to
acquire properties and for general corporate and
working capital purposes(2) $ 157,032,500 92.24 %
(1) Estimated.
(2) Estimated allocation of estimated net proceeds:
Acquisition of farms $ 141,329,250 90.0 %
Acquisition of farming-related properties $ 7,851,625 5.0 %
Mortgage loans $ 3,140,650 2.0 %
Payments to Adviser $ 3,500,000 2.2 %
General corporate and working capital $ 1,210,975 0.8 %
Total Estimated Net Proceeds $ 157,032,500 100 %
Competition to our efforts to acquire farmland can come from many different
entities. Developers, municipalities, individual farmers, agriculture
corporations, institutional investors and others vie for farmland acreage.
Other investment firms that we might compete directly against could include
agricultural investment firms such as Hancock Agricultural Investment Group,
or Hancock, and UBS Agrivest LLC, or UBS Agrivest. Hancock is a large
institutional manager of agricultural real estate and has reported that it owns
approximately 165,000 acres of prime farmland. UBS Agrivest has reported that
it has over 25 years of farmland investment management experience and engages
in the acquisition, asset management, valuation and disposition of all types of
farmland properties. In addition to competition for direct investment in
farmland we also expect to compete for mortgages with many local and national
banks such as Rabobank, N.A., Bank of America, N.A., Wells Fargo Foothill,
Inc., and others.
Company Description
We are an externally-managed corporation that currently owns two farms in
California that we lease to Dole Fresh Vegetables, Inc., or Dole Fresh,
a wholly owned subsidiary of Dole Food Company, or Dole Foods, which is a
guarantor of the leases. We intend to acquire more farmland to lease to
farmers. We may elect to sell properties at such times as, for example, the
land may be developed by others for urban or suburban uses. To a lesser extent,
we may provide senior secured first lien mortgages to farmers for the purchase
of farmland and properties related to farming. We expect that any mortgages we
make would be secured by farming properties that have been in operation for
over five years with a history of crop production and profitable farming
operations. We expect that most of our future tenants and borrowers will be
small and medium-sized farming operations that are unrelated to us. We may also
acquire properties related to farming, such as coolers, processing plants,
packing buildings and distribution centers. We intend to lease our properties
under triple net leases, an arrangement under which the tenant maintains the
property while paying us rent plus taxes and insurance. We have currently
identified properties to potentially acquire, and we have provided non-binding
expressions of interest to purchase each of these properties, but we have not
yet entered into letters of intent or binding agreements to acquire these
properties, and there is no guarantee that we will be able to acquire any of
them. We have not identified any other specific properties to acquire or for
which to invest in mortgages. We are actively seeking and evaluating properties
in this regard. We may also provide ancillary services to farmers through our
wholly owned subsidiary Gladstone Land Advisers, Inc.
We intend to elect to be taxed as a real estate investment trust, or REIT,
under federal tax laws beginning with the year ending December 31, 2011 or
December 31, 2012. Gladstone Management Corporation serves as our adviser and
manages our real estate portfolio.
We were incorporated in 1997. Prior to 2004, we engaged in the owning and
leasing of farmland, as well as an agricultural operating business whereby we
engaged in the farming, contract growing, packaging, marketing and distribution
of fresh berries, including commission selling and contract cooling services to
independent berry growers. In 2004 we sold our agricultural operating business
to Dole Fresh. Since 2004, our operations have consisted solely of leasing our
farms located in Watsonville, California and Oxnard, California to Dole Fresh.
We also lease a small parcel on our Oxnard farm to an oil company. We do not
currently intend to enter the business of growing and marketing farmed
products. However, if we do so in the future we will do so through a taxable
REIT subsidiary.
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We were incorporated in California in 1997 and reincorporated in Delaware in
2004. Our executive offices are located at 1521 Westbranch Drive, Second Floor,
McLean, Virginia 22102. We also maintain an office in Oxnard, California. Our
telephone number at our executive offices is (703) 287-5800 and our corporate
website will be www.GladstoneLand.com.
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