GLADSTONE LAND Corp 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA Index to Consolidated Financial Statements PAGE Report of Management on Internal Control over Financial Reporting 63 Report of Independent Registered Public Accounting Firm (PCAOB ID 238 ) 64 Consolidated Balance Sheets as of December 31, 2024 and 2023 66 Consolidated Statements of Operations and Comprehensive Income for the years ended December 31, 2024, 2023, and 2022 67 Consolidated Statements of Equity for the years ended December 31, 2024, 2023, and 2022 68 Consolidated Statements of Cash Flows for the years ended December 31, 2024, 2023, and 2022 70 Notes to Consolidated Financial Statements 71 Schedule III – Real Estate and Accumulated Depreciation as of December 31, 2024 97 62 Table of Content Report of Management on Internal Control over Financial Reporting To the Stockholders and Board of Directors of Gladstone Land Corporation: Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and include those policies and procedures that pertain to the maintenance of records that in reasonable detail accurately and fairly reflect our transactions and the dispositions of our assets, provide reasonable assurance that our transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with appropriate authorizations; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Under the supervision and with the participation of our management, we assessed the effectiveness of our internal control over financial reporting based on the framework in Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations (COSO). Based on our assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2024. February 19, 2025 63 Table of Content Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Gladstone Land Corporation Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of Gladstone Land Corporation and its subsidiaries (the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income, of equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the "consolidated financial statements"). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America. Basis for Opinion These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Real Estate Impairment Evaluation – Undiscounted Future Cash Flows As described in Notes 2 and 3 to the consolidated financial statements, the Company’s consolidated total real estate, net balance was $1.2 billion as of December 31, 2024. During 2024, the Company recognized an impairment charge of $2.1 million. Management periodically reviews the carrying value of each property to determine whether indicators of impairment exist. If circumstances support the possibility of impairment, management prepares a projection of the total undiscounted future cash flows of the specific property (without interest charges), including net proceeds from disposition, if any, and compares them to the net book value of the property to determine whether the carrying value of the property is recoverable. In preparing the projection of undiscounted future cash flows, management estimates cap rates, rental rates, and property values, as applicable, using information obtained from market data and other comparable sources, such as recent sales data from comparable properties and broker quotes, and applies the undiscounted cash flows to the expected hold period. If impairment is indicated, the carrying value of the property is written down to its estimated fair value based on management’s best estimate of the property’s discounted future cash flows using market-derived terms, such as cap rates, discount rates, and rental rates applied to the expected hold period. The principal considerations for our determination that performing procedures relating to the undiscounted future cash flows used in the real estate impairment evaluation is a critical audit matter are (i) the significant judgment by management when developing the projection of the undiscounted future cash flows and (ii) a high degree of auditor judgment, subjectivity, and 64 Table of Content effort in performing procedures and evaluating management’s significant assumptions related to the rental rates and expected hold periods. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included, among others (i) testing management’s process for developing the projection of the undiscounted future cash flows; (ii) evaluating the appropriateness of the undiscounted cash flow model; (iii) testing the completeness and accuracy of underlying data used in the undiscounted cash flow model; and (iv) evaluating the reasonableness of the significant assumptions used by management related to rental rates and expected holding periods. Evaluating management’s assumptions related to the rental rates and expected holding periods involved evaluating whether the assumptions used by management were reasonable considering (i) the consistency with external market and industry data and (ii) whether the rental rates assumption was consistent with evidence obtained in other areas of the audit. /s/ PricewaterhouseCoopers LLP Washington, DC February 19, 2025 We have served as the Company’s auditor since 2005. 65 Table of Content GLADSTONE LAND CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share and per-share data) December 31, 2024 December 31, 2023 ASSETS Real estate, at cost $ 1,324,632 $ 1,383,742 Less: accumulated depreciation ( 167,782 ) ( 142,212 ) Total real estate, net 1,156,850 1,241,530 Lease intangibles, net 3,588 4,782 Real estate and related assets held for sale, net 46,314 53,626 Cash and cash equivalents 18,275 18,571 Other assets, net 87,168 68,815 TOTAL ASSETS $ 1,312,195 $ 1,387,324 LIABILITIES AND EQUITY LIABILITIES: Borrowings under lines of credit $ 3,600 $ 200 Notes and bonds payable, net 523,922 573,911 Series D cumulative term preferred stock, net, $ 0.001 par value, $ 25.00 per share liquidation preference; 3,600,000 shares authorized, 2,415,000 shares issued and outstanding as of December 31, 2024, and December 31, 2023 59,930 59,519 Accounts payable and accrued expenses 18,404 10,298 Due to related parties, net 2,972 3,874 Other liabilities, net 16,185 19,909 Total liabilities 625,013 667,711 Commitments and contingencies (Note 7) EQUITY: Stockholders’ equity: Series B cumulative redeemable preferred stock, $ 0.001 par value; $ 25.00 per share liquidation preference; 6,340,889 shares authorized, 5,840,889 shares issued and outstanding as of December 31, 2024; 6,456,065 shares authorized, 5,956,065 shares issued and outstanding as of December 31, 2023 6 6 Series C cumulative redeemable preferred stock, $ 0.001 par value, $ 25.00 per share liquidation preference; 25,700,791 shares authorized, 9,954,863 shares issued and outstanding as of December 31, 2024; 25,902,437 shares authorized, 10,156,509 shares issued and outstanding as of December 31, 2023 10 10 Series E cumulative redeemable preferred stock, $ 0.001 par value, $ 25.00 per share liquidation preference; 15,998,400 shares authorized, 252,436 shares issued and outstanding as of December 31, 2024; 15,998,400 shares authorized, 235,841 issued and outstanding as of December 31, 2023 — — Common stock, $ 0.001 par value; 48,359,920 shares authorized, 36,184,658 shares issued and outstanding as of December 31, 2024; 48,043,098 shares authorized, 35,838,442 shares issued and outstanding as of December 31, 2023 36 36 Additional paid-in capital 854,059 856,206 Distributions in excess of accumulated earnings ( 174,561 ) ( 144,011 ) Accumulated other comprehensive income (loss) 7,632 7,366 Total stockholders’ equity 687,182 719,613 Non-controlling interests in Operating Partnership — — Total equity 687,182 719,613 TOTAL LIABILITIES AND EQUITY $ 1,312,195 $ 1,387,324 The accompanying notes are an integral part of these consolidated financial statements. 66 Table of Content GLADSTONE LAND CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (In thousands, except share and per-share data) For the Years Ended December 31, 2024 2023 2022 OPERATING REVENUES: Lease revenue, net $ 84,763 $ 90,319 $ 89,236 Other operating revenue 453 79 — Total operating revenues 85,216 90,398 89,236 OPERATING EXPENSES: Depreciation and amortization 35,055 37,161 35,366 Property operating expenses 5,334 4,201 2,819 Base management fee 8,370 8,603 8,307 Incentive fee 109 1,771 3,225 Administration fee 2,452 2,255 2,005 General and administrative expenses 2,625 2,924 2,740 Write-off of costs associated with offering of Series C cumulative redeemable preferred stock — — 853 Impairment charge 2,106 — — Total operating expenses 56,051 56,915 55,315 Incentive fee waiver ( 109 ) — — Total operating expenses, net of credits to fees 55,942 56,915 55,315 OTHER INCOME (EXPENSE): Other income 3,378 3,633 3,441 Interest expense ( 21,885 ) ( 23,665 ) ( 25,738 ) Dividends declared on cumulative term preferred stock ( 3,019 ) ( 3,019 ) ( 3,019 ) Gain (loss) on dispositions of real estate assets, net 5,886 5,208 ( 3,760 ) Property and casualty loss, net ( 284 ) ( 1,016 ) ( 56 ) Loss from investments in unconsolidated entities ( 60 ) ( 59 ) ( 73 ) Total other expense, net ( 15,984 ) ( 18,918 ) ( 29,205 ) NET INCOME 13,290 14,565 4,716 Net income attributable to non-controlling interests — — ( 8 ) NET INCOME ATTRIBUTABLE TO THE COMPANY 13,290 14,565 4,708 Dividends declared on cumulative redeemable preferred stock ( 24,250 ) ( 24,371 ) ( 19,693 ) Gain (loss) on extinguishment of cumulative redeemable preferred stock, net 505 ( 46 ) ( 25 ) NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ ( 10,455 ) $ ( 9,852 ) $ ( 15,010 ) LOSS PER COMMON SHARE: Basic and diluted $ ( 0.29 ) $ ( 0.28 ) $ ( 0.43 ) WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING Basic and diluted 35,909,956 35,733,742 34,563,460 NET INCOME: 13,290 14,565 4,716 Change in fair value related to interest rate hedging instruments 266 ( 1,641 ) 10,043 COMPREHENSIVE INCOME 13,556 12,924 14,759 Comprehensive income attributable to non-controlling interests — — ( 8 ) COMPREHENSIVE INCOME ATTRIBUTABLE TO THE COMPANY $ 13,556 $ 12,924 $ 14,751 The accompanying notes are an integral part of these consolidated financial statements. 67 Table of Content GLADSTONE LAND CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY (In thousands, except share data) Series B Preferred Stock Series C Preferred Stock Series E Preferred Stock Common Stock Additional Paid-in Capital Distributions in Excess of Accumulated Earnings Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Non- Controlling Interest Total Equity No. of Shares Par Value No. of Shares Par Value No. of Shares Par Value No. of Shares Par Value Balance at December 31, 2021 5,956,065 $ 6 3,493,333 $ 3 — $ — 34,210,013 $ 34 $ 668,275 $ ( 80,467 ) $ ( 1,036 ) $ 586,815 $ 2,251 $ 589,066 Issuance of Series C Preferred Stock, net — — 6,736,615 7 — — — — 152,732 — — 152,739 — 152,739 Redemptions of Series C Preferred Stock, net — — ( 38,595 ) — — — — — ( 876 ) ( 25 ) — ( 901 ) — ( 901 ) Redemptions of OP Units — — — — — — ( 3,700 ) — — ( 3,700 ) ( 3,970 ) ( 7,670 ) Issuance of common stock, net — — — — — — 840,384 1 21,981 — — 21,982 — 21,982 Net income — — — — — — — — — 4,708 — 4,708 8 4,716 Dividends—cumulative redeemable preferred stock — — — — — — — — — ( 19,693 ) — ( 19,693 ) — ( 19,693 ) Distributions—OP Units and common stock — — — — — — — — — ( 18,893 ) — ( 18,893 ) ( 27 ) ( 18,920 ) Comprehensive income attributable to the Company — — — — — — — — — — 10,043 10,043 — 10,043 Adjustment to non-controlling interests resulting from changes in ownership of the Operating Partnership — — — — — — — — ( 1,738 ) — — ( 1,738 ) 1,738 — Balance at December 31, 2022 5,956,065 $ 6 10,191,353 $ 10 — $ — 35,050,397 $ 35 $ 836,674 $ ( 114,370 ) $ 9,007 $ 731,362 $ — $ 731,362 Issuance of Series C Preferred Stock, net — — 14,069 — — — — — 298 — — 298 — 298 Redemptions of Series C Preferred Stock, net — — ( 48,913 ) — — — — — ( 1,110 ) ( 46 ) — ( 1,156 ) — ( 1,156 ) Issuance of Series E Preferred Stock, net — — — — 237,441 — — — 5,301 — — 5,301 — 5,301 Redemptions of Series E Preferred Stock, net — — — — ( 1,600 ) — — — ( 36 ) — — ( 36 ) — ( 36 ) Issuance of common stock, net — — — — — — 788,045 1 15,079 — — 15,080 — 15,080 Net income — — — — — — — — — 14,565 — 14,565 — 14,565 Dividends—cumulative redeemable preferred stock — — — — — — — — — ( 24,371 ) — ( 24,371 ) — ( 24,371 ) Distributions—OP Units and common stock — — — — — — — — — ( 19,789 ) — ( 19,789 ) — ( 19,789 ) Comprehensive income attributable to the Company — — — — — — — — — — ( 1,641 ) ( 1,641 ) — ( 1,641 ) Balance at December 31, 2023 5,956,065 $ 6 10,156,509 $ 10 235,841 $ — 35,838,442 $ 36 $ 856,206 $ ( 144,011 ) $ 7,366 $ 719,613 $ — $ 719,613 The accompanying notes are an integral part of these consolidated financial statements 68 Table of Content GLADSTONE LAND CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF EQUITY (Continued) (In thousands, except share data) Series B Preferred Stock Series C Preferred Stock Series E Preferred Stock Common Stock Additional Paid-in Capital Distributions in Excess of Accumulated Earnings Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Non- Controlling Interest Total Equity No. of Shares Par Value No. of Shares Par Value No. of Shares Par Value Number of Shares Par Value Balance at December 31, 2023 5,956,065 $ 6 10,156,509 $ 10 235,841 $ — 35,838,442 $ 36 $ 856,206 $ ( 144,011 ) $ 7,366 $ 719,613 $ — $ 719,613 Redemptions of Series B Preferred Stock, net ( 115,176 ) — — — — — — — ( 2,562 ) 133 — ( 2,429 ) — ( 2,429 ) Redemptions of Series C Preferred Stock, net — — ( 201,646 ) — — — — — ( 4,574 ) 372 — ( 4,202 ) — ( 4,202 ) Issuance of Series E Preferred Stock, net — — — — 16,595 — — — 358 — — 358 — 358 Issuance of common stock, net — — — — — — 346,216 — 4,631 — — 4,631 — 4,631 Net income — — — — — — — — — 13,290 — 13,290 — 13,290 Dividends—cumulative redeemable preferred stock — — — — — — — — — ( 24,250 ) — ( 24,250 ) — ( 24,250 ) Distributions—OP Units and common stock — — — — — — — — — ( 20,095 ) — ( 20,095 ) — ( 20,095 ) Comprehensive income attributable to the Company — — — — — — — — — — 266 266 — 266 Balance at December 31, 2024 5,840,889 $ 6 9,954,863 $ 10 252,436 $ — 36,184,658 $ 36 $ 854,059 $ ( 174,561 ) $ 7,632 $ 687,182 $ — $ 687,182 The accompanying notes are an integral part of these consolidated financial statements. 69 Table of Content GLADSTONE LAND CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) For the Years Ended December 31, 2024 2023 2022 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 13,290 $ 14,565 $ 4,716 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 35,055 37,161 35,366 Impairment charge 2,106 — — Amortization of debt issuance costs 990 1,065 1,085 Amortization of deferred rent assets and liabilities, net 2,055 534 ( 482 ) Amortization of right-of-use assets from operating leases and operating lease liabilities, net 56 92 90 Loss from investments in unconsolidated entities 60 59 73 Bad debt expense 372 149 83 Write-off of unamortized deferred offering costs associated with cumulative redeemable preferred stock (Series C) — — 798 (Gain) loss on dispositions of real estate assets, net ( 5,886 ) ( 5,208 ) 3,760 Property and casualty loss, net 284 1,016 56 Changes in operating assets and liabilities: Other assets, net ( 11,275 ) ( 6,914 ) ( 7,487 ) Accounts payable and accrued expenses and Due to related parties, net ( 6,101 ) ( 3,400 ) 5,678 Other liabilities, net ( 1,458 ) 962 52 Net cash provided by operating activities 29,548 40,081 43,788 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisition of new real estate assets — — ( 62,055 ) Capital expenditures on existing real estate assets ( 5,197 ) ( 12,805 ) ( 20,126 ) Contributions to unconsolidated real estate entities — — ( 2,749 ) Proceeds from dispositions of real estate assets, net 68,505 9,037 — Deposits on prospective real estate acquisitions and investments — — ( 554 ) Net cash provided by (used in) investing activities 63,308 ( 3,768 ) ( 85,484 ) CASH FLOWS FROM FINANCING ACTIVITIES: Borrowings from lines of credit 3,400 200 — Repayments of lines of credit — ( 100 ) — Borrowings from notes and bonds payable — — 9,932 Repayments of notes and bonds payable ( 50,519 ) ( 53,015 ) ( 51,651 ) Payments of financing fees ( 50 ) ( 192 ) ( 948 ) Proceeds from issuance of preferred and common equity 5,094 21,268 188,106 Offering costs ( 104 ) ( 763 ) ( 13,751 ) Redemptions of cumulative redeemable preferred stock ( 6,630 ) ( 1,191 ) ( 901 ) Payments for redemptions of OP Units — — ( 7,670 ) Dividends paid on cumulative redeemable preferred stock ( 24,248 ) ( 25,301 ) ( 18,068 ) Distributions paid on OP Units — — ( 27 ) Distributions paid on common stock ( 20,095 ) ( 19,789 ) ( 18,893 ) Net cash (used in) provided by financing activities ( 93,152 ) ( 78,883 ) 86,129 NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ( 296 ) ( 42,570 ) 44,433 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 18,571 61,141 16,708 CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 18,275 $ 18,571 $ 61,141 The accompanying notes are an integral part of these consolidated financial statements. GLADSTONE LAND CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued) (In thousands) SUPPLEMENTAL CASH FLOW INFORMATION: Interest paid (1) $ 24,396 $ 26,218 $ 25,259 NON-CASH INVESTING AND FINANCING INFORMATION: Real estate additions included in Accounts payable and accrued expenses and Due to related parties, net 802 441 2,657 Tenant-funded improvements included within Real estate, at cost — 25 284 Stock offering and OP Unit issuance costs included in Accounts payable and accrued expenses and Due to related parties, net 4 11 108 Financing fees included in Accounts payable and accrued expenses and Due to related parties, net — 7 42 Dividends paid on Series C Preferred Stock via additional share issuances — 320 788 (1) Includes distributions made on our cumulative term preferred stock The accompanying notes are an integral part of these consolidated financial statements. 70 Table of Content GLADSTONE LAND CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS References to the number of farms/properties, acreage, and primary crops use are unaudited. NOTE 1. BUSINESS AND ORGANIZATION Business Gladstone Land Corporation (“we,” “us,” or the “Company”) is an agricultural real estate investment trust (“REIT”) that was re-incorporated in Maryland on March 24, 2011, having been originally incorporated in California on June 14, 1997. We are primarily in the business of owning and leasing farmland. Subject to certain restrictions and limitations, and pursuant to contractual agreements, our business is managed by Gladstone Management Corporation (the “Adviser”), a Delaware corporation, and administrative services are provided to us by Gladstone Administration, LLC (the “Administrator”), a Delaware limited liability company. Our Adviser and Administrator are both affiliates of ours (see Note 6, “ Related-Party Transactions ,” for additional discussion regarding our Adviser and Administrator). Organization We conduct substantially all of our operations through a subsidiary, Gladstone Land Limited Partnership (the “Operating Partnership”), a Delaware limited partnership. As we currently control the sole general partner of the Operating Partnership and own, directly or indirectly, a majority of the common units of limited partnership interest in the Operating Partnership (“OP Units”), the financial position and results of operations of the Operating Partnership are consolidated within our financial statements. As of each of December 31, 2024, 2023, and 2022, the Company owned approximately 100.0 % of the outstanding OP Units (see Note 8, “ Equity ,” for additional discussion regarding OP Units). Gladstone Land Partners, LLC (“Land Partners”), a Delaware limited liability company and a subsidiary of ours, was organized to engage in any lawful act or activity for which a limited liability company may be organized in Delaware. Land Partners is the general partner of the Operating Partnership and has the power to make and perform all contracts and to engage in all activities necessary in carrying out the purposes of the Company, as well as all other powers available to it as a limited liability company. As we currently own all of the membership interests of Land Partners, the financial position and results of operations of Land Partners are consolidated within our financial statements. Gladstone Land Advisers, Inc. (“Land Advisers”), a Delaware corporation and a subsidiary of ours, was created to collect any non-qualifying income related to our real estate portfolio and to perform certain small-scale farming business operations. We have elected for Land Advisers to be taxed as a taxable REIT subsidiary (“TRS”) of ours. Since we currently own all of the voting securities of Land Advisers, its financial position and results of operations are consolidated within our financial statements. For each of the tax years ended December 31, 2024, 2023, and 2022 , there was no taxable income or loss from Land Advisers, nor did we have any undistributed REIT taxable income. All further references herein to “we,” “us,” “our,” and the “Company” refer, collectively, to Gladstone Land Corporation and its consolidated subsidiaries, except where indicated otherwise. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of financial statements in accordance with U.S. generally-accepted accounting principles (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may materially differ from these estimates. Real Estate and Lease Intangibles Our investments in real estate consist of farmland, improvements made to the farmland (consisting primarily of irrigation and drainage systems and buildings), and permanent plantings acquired in connection with certain land purchases (consisting primarily of almond and pistachio trees, blueberry bushes, and wine vineyards). We record investments in real estate at cost and generally capitalize improvements and replacements when they extend the useful life or improve the efficiency of the asset. We expense costs of routine repairs and maintenance as such costs are incurred. We generally compute depreciation using the 71 Table of Content straight-line method over the shorter of the estimated useful life or 50 years for buildings, improvements, and permanent plantings, and the shorter of the estimated useful life or 5 to 20 years for equipment and fixtures. Certain of our acquisitions involve sale-leaseback transactions with newly-originated leases, and other of our acquisitions involve the acquisition of farmland that was already being operated as rental property, in which case we will typically assume the lease in place at the time of acquisition. Most of our acquisitions, including those with a prior leasing history, are generally treated as asset acquisitions under Accounting Standards Codification (“ASC”) 805, “Business Combinations” (“ASC 805”). ASC 805 requires that the purchase price of real estate be allocated to (i) the tangible assets acquired and liabilities assumed (typically consisting of land, buildings, improvements, permanent plantings, and long-term debt) and, if applicable, (ii) any identifiable intangible assets and liabilities (typically consisting of in-place lease values, lease origination costs, the values of above- and below-market leases, and tenant relationships), based in each case on their fair values. In addition, all acquisition-related costs (other than legal costs incurred directly related to either originating new leases we execute upon acquisition or reviewing in-place leases we assumed upon acquisition) are capitalized and included as part of the fair value allocation of the identifiable tangible and intangible assets acquired or liabilities assumed. Management’s estimates of fair value are made using methods similar to those used by independent appraisers, such as a sales comparison approach, a cost approach, and either an income capitalization approach or discounted cash flow analysis. Factors considered by management in its analysis include an estimate of carrying costs during hypothetical, expected lease-up periods, taking into consideration current market conditions and costs to execute similar leases. We also consider information obtained about each property as a result of our pre-acquisition due diligence, marketing, and leasing activities in estimating the fair value of the tangible and intangible assets acquired and liabilities assumed. In estimating carrying costs, management also includes lost reimbursement of real estate taxes, insurance, and certain other operating expenses, as well as estimates of lost rental income at market rates during the hypothetical, expected lease-up periods, which typically range from 1 to 24 months, depending on specific local market conditions. Management also estimates costs to execute similar leases, including leasing commissions, legal fees, and other related expenses, to the extent that such costs are not already incurred in connection with a new lease origination as part of the transaction. While management believes these estimates to be reasonable based on the information available at the time of acquisition, the purchase price allocation may be adjusted if management obtains more information regarding the valuations of the assets acquired or liabilities assumed. We allocate the purchase price to the fair value of the tangible assets and liabilities of an acquired property by valuing the property as if it were vacant. The “as-if-vacant” value is allocated to land, buildings, improvements, and permanent plantings, based on management’s determination of the relative fair values of such assets and liabilities as of the date of acquisition. We record above- and below-market lease values for acquired properties based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place lease agreements, and (ii) management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining, non-cancelable term of the lease. When determining the non-cancelable term of the lease, we evaluate whether fixed-rate or below-market renewal options, if any, should be included. The fair value of capitalized above-market lease values, included as part of Other assets in the accompanying Consolidated Balance Sheets, is amortized as a reduction of rental income on a straight-line basis over the remaining, non-cancelable terms of the respective leases. The fair value of capitalized below-market lease values, included as part of Other liabilities in the accompanying Consolidated Balance Sheets, is amortized as an increase to rental income on a straight-line basis over the remaining, non-cancelable terms of the respective leases, including that of any fixed-price or below-market renewal options. The value of the remaining intangible assets acquired, which consists of in-place lease values, lease origination costs, and tenant relationship values, are determined based on management’s evaluation of the specific characteristics of each tenant’s lease and our overall relationship with that respective tenant. Characteristics to be considered by management in allocating these values include the nature and extent of our existing business relationships with the tenant, prospects for developing additional business with the tenant, the tenant’s credit quality, and our expectations of lease renewals (including those existing under the terms of the current lease agreement), among other factors. The value of in-place leases and certain lease origination costs (if any) are amortized to amortization expense on a straight-line basis over the remaining, non-cancelable terms of the respective leases. The value of tenant relationship intangibles, which is the benefit to us resulting from the likelihood of an existing tenant renewing its lease at the existing property or entering into a lease at a different property we own, is amortized to amortization expense over the remaining lease term and any anticipated renewal periods in the respective leases. Should a tenant terminate its lease, the unamortized portion of the above intangible assets or liabilities would be charged to the appropriate income or expense account. 72 Table of Content Total consideration for acquisitions may include a combination of cash and equity securities, such as OP Units. When OP Units are issued in connection with acquisitions, we determine the fair value of the OP Units issued based on the number of units issued multiplied by the closing price of the Company’s common stock on the date of acquisition. Real Estate Impairment Evaluation We account for the impairment of our real estate assets in accordance with ASC 360, “Property, Plant, and Equipment” (“ASC 360”), which requires us to periodically review the carrying value of each property to determine whether indicators of impairment exist or if depreciation periods should be modified. In determining if impairment exists, we consider such indicators which may include, but are not limited to: deteriorating market conditions; declines in a property’s operating performance due to near-term lease maturities or vacancy rates; environmental damage, including due to natural disasters or tenant neglect; legal concerns; and whether our hold period has shortened. If circumstances support the possibility of impairment, we prepare a projection of the total undiscounted future cash flows of the specific property (without interest charges), including net proceeds from disposition, if any, and compare them to the net book value of the property to determine whether the carrying value of the property is recoverable. In preparing the projection of undiscounted future cash flows, we estimate cap rates, rental rates, and property values, as applicable, using information that we obtain from market data and other comparable sources, such as recent sales data from comparable properties and broker quotes, and apply the undiscounted cash flows to our expected holding period. If impairment is indicated, the carrying value of the property is written down to its estimated fair value based on our best estimate of the property’s discounted future cash flows using market-derived terms, such as cap rates, discount rates, and rental rates applied to our expected hold period. Using the methodology discussed above, we evaluated our entire portfolio for any impairment indicators and performed an impairment analysis on select properties that had an indication of impairment. See Note 3, “ Real Estate and Lease Intangibles—Impairment ,” for further discussion. Held-for-Sale Property For properties classified as held-for-sale, we cease depreciating and amortizing the property and related intangible assets and value the property at the lower of depreciated and amortized cost or fair value, less costs to dispose. If the sale meets the definition of discontinued operations, we present the related assets, liabilities, and results of operations that have been sold (or that otherwise qualify as held-for-sale) as discontinued operations in all periods. The definition of discontinued operations is met if the disposal of a component or group of components either meets the held-for-sale criteria or is disposed of and also represents a strategic shift that has (or will have) a major effect on our operations and financial results. If classified as such, the components of the property’s net income (loss) that are reflected as discontinued operations include operating results, depreciation, amortization, and interest expense. When properties are considered held-for-sale, but do not qualify as a discontinued operation, we present such assets and liabilities as held for sale on the consolidated balance sheet in all periods that the related assets and liabilities meet the held-for-sale criteria under ASC 360. Components of the held-for-sale property’s net income (loss) are recorded within continuing operations on the consolidated statements of operations and comprehensive income. See Note 3, “ Real Estate and Lease Intangibles—Real Estate Held for Sale ,” for further discussion. Tenant Improvements From time to time, our tenants may pay for improvements on certain of our properties with the ownership of the improvements remaining with us, in which case we will record the cost of such improvements as an asset (tenant-funded improvements, included within Investments in real estate, net), along with a corresponding liability (deferred rent liability, included within Other liabilities, net) on our Consolidated Balance Sheets. When we are determined to be the owner of the tenant-funded improvements, such improvements will be depreciated over the useful life in accordance with our depreciation policy noted above, and the related deferred rent liability will be amortized as an addition to rental income over the remaining term of the existing lease in place. If the tenant is determined to be the owner of a tenant improvement funded by us, such amounts are treated as a lease incentive and amortized as a reduction of rental income over the remaining term of the existing lease in place. In determining whether the tenant or the Company is the owner of such improvements, several factors will be considered, including, but not limited to: (i) whether the improvement’s useful life is greater than the remaining lease term plus any reasonably certain renewal options; (ii) whether the lease allows the tenant to remove the improvements; (iii) whether the improvement is unique to the tenant or useful to subsequent tenants; (iv) whether the improvement adds value to the property or increases the lifespan of the property; and (v) whether the tenant was provided a form of reimbursement or incentive concerning the improvement. The determination of who owns the improvements can be subject to significant judgment. Cash and Cash Equivalents 73 Table of Content We consider cash equivalents to be all short-term, highly-liquid investments that are both readily convertible to cash and have a maturity of three months or less at the time of purchase, except that any such investments purchased with funds held in escrow or similar accounts are classified as restricted cash. Items classified as cash equivalents include money-market deposit accounts. Our cash and cash equivalents as of December 31, 2024 and 2023 were held in the custody of one financial institution (which management believes to be financially sound and with minimal credit risk), and our balance at times may exceed federally-insurable limits. We did no t have any restricted cash or cash equivalents as of either December 31, 2024 or 2023. Debt Issuance Costs Debt issuance costs consist of costs incurred to obtain debt financing, including legal fees, origination fees, and administrative fees. Costs associated with our long-term borrowings and term preferred stock securities required to be recorded net of the respective debt for GAAP purposes are deferred and amortized over the terms of the respective financings using the straight-line method, which approximates the effective interest method. In the case of our lines of credit, the straight-line method is used due to the revolving nature of the financing instrument. Upon early extinguishment of any borrowings, the unamortized portion of the related deferred financing costs will be immediately charged to expense. In addition, in accordance with ASC 470, “Debt” (“ASC 470”), when a financing arrangement is amended so that the only material change is an increase in the borrowing capacity, the unamortized deferred financing costs from the prior arrangement are amortized over the term of the new arrangement. During the years ended December 31, 2024, 2023, and 2022, we recorded approximately $ 990,000 , $ 1.1 million, and $ 1.1 million, respectively, of total amortization expense related to debt issuance costs . Deferred Offering Costs We account for offering costs in accordance with SEC Staff Accounting Bulletin Topic 5.A., which states that incremental offering costs directly attributable to a proposed or actual offering of securities may be deferred and charged against the gross proceeds of such offering. Accordingly, costs incurred related to our ongoing equity offerings are included in Other assets, net on the accompanying Consolidated Balance Sheets and are ratably applied to the cost of equity as the related securities are issued. If an equity offering is subsequently terminated, the remaining, unallocated portion of the related deferred offering costs are charged to expense in the period such offering is aborted and recorded on the accompanying Consolidated Statements of Operations and Comprehensive Income. Other Assets and Other Liabilities Other assets, net generally consists primarily of net deferred rent assets, rents and other accounts receivable, deferred offering costs, prepaid expenses, deferred financing costs associated with our lines of credit, operating lease right-of-use assets, deposits on potential real estate acquisitions, the carrying value of certain farm equipment owned by us and used on our farms, investments in long-term water assets (see “ —Investments in Water Assets ” below for further discussion), net ownership interests in special-purpose LLCs (see “ —Investments in Unconsolidated Entities ” below for further discussion), and the fair value of interest rate swaps if market interest rates are above the fixed rate of the respective swap (see Note 4, “Borrowings—Interest Rate Swap Agreements ,” for further discussion). Other liabilities, net generally consists primarily of rents received in advance, net deferred rent liabilities, operating lease liabilities, and the fair value of interest rate swaps if market interest rates are below the fixed rate of the respective swap (see Note 4, “Borrowings—Interest Rate Swap Agreements ,” for further discussion). Investments in Unconsolidated Entities We determine if an entity is a variable interest entity (“VIE”) in accordance with ASC Topic 810, “Consolidation.” For an entity in which we have acquired an interest, the entity will be considered a VIE if either of the following characteristics are met: (i) the entity lacks sufficient equity to finance its activities without additional subordinated financial support, or (ii) equity holders, as a group, lack the characteristics of a controlling financial interest. We evaluate all significant investments in real estate-related assets to determine if they are VIEs, utilizing judgment and estimates that are inherently subjective. If an entity is determined to be a VIE, we then determine whether to consolidate the entity as the primary beneficiary. The primary beneficiary has both (i) the power to direct the activities that most significantly impact the VIE’s economic performance, and (ii) the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the entity. See Note 3, “ Real Estate and Lease Intangibles—Investments in Unconsolidated Entities ,” for further discussion. Investments in Water Assets 74 Table of Content From time to time, we have entered into contracts to acquire additional water assets for certain of our farms (see Note 3, “ Real Estate and Lease Intangibles—Investments in Water Assets ”). The water assets acquired may be in the form of either water banked at a government municipality or groundwater pumping credits obtained through groundwater recharge programs established by government municipalities, which recharge is achieved via groundwater recharge facilities we have constructed on certain of our farms. The contracts we have entered into to acquire additional water assets cannot readily be net settled by means outside of the respective contracts; therefore, in accordance with ASC 360, we recognize the investments in long-term water assets at cost, including all costs necessary to procure and transfer the water asset to its intended location. Costs to acquire water assets are initially deferred in a prepaid account until such time that the water assets are recognized by the respective water district, at which time, the costs related to the recognized water assets are reclassed and capitalized as an investment in long-term water assets. Investments in long-term water assets and the related prepaid asset are both included in Other assets, net on our accompanying Consolidated Balance Sheets. While we may, in the future, sell portions of these water assets to unrelated third parties for a profit, our current intent is to hold these water assets for the long-term for future use on our farms. There is no amount of time by which we must use these water assets. Each quarter, we will review our investments in long-term water assets for any indicators of impairment in accordance with ASC 360 and perform an impairment analysis if there are any such indicators. In determining if impairment exists, we consider such indicators which may include, but are not limited to, deteriorating market conditions and environmental or regulatory changes. As of December 31, 2024, we concluded that no water assets were impaired. Non-controlling Interests Non-controlling limited interests in our Operating Partnership are those OP Units not owned by us. We evaluate whether OP Units held by non-controlling OP Unitholders are subject to redemption features outside of our control. OP Units held by non-controlling OP Unitholders are redeemable at the option of the holder for cash or, at our election, shares of our common stock and thus are reported in the equity section of the Consolidated Balance Sheets but separate from stockholders’ equity. The amount reported for such non-controlling interests on the Consolidated Statements of Operations and Comprehensive Income represent the portion of income (loss) from the Operating Partnership not attributable to us. At the end of each reporting period, we determine the amount of equity (at book value) that is allocable to non-controlling interests based upon the respective ownership interests. To reflect such non-controlling interests’ equity interest in the Company, an adjustment is made to non-controlling interests, with a corresponding adjustment to paid-in capital, as reflected on the Consolidated Statements of Equity. Lease Revenue Lease revenue includes rents that each tenant pays in accordance with the terms of its respective lease, reported evenly over the non-cancelable term of the lease. Most of our leases contain rental increases at specified intervals, which we recognize on a straight-line basis. For leases that are deemed not probable of collection, revenue is recorded as the lesser of (i) the amount that would be recognized on a straight-line basis or (ii) cash that has been received from the tenant (including deferred revenue), with any receivable balances (including deferred rent receivables) charged as a direct write-off against lease revenue in the period of the change in the collectability determination. If the collectability determination for leases for which revenue is being recorded based on cash received from the tenant subsequently changes to being probable, we resume recognizing revenue, including deferred revenue, on a straight-line basis and recognize incremental revenue related to the reinstatement of cumulative deferred rent receivable and deferred revenue balances as if revenue had been recorded on a straight-line basis since the inception of the lease. As of December 31, 2024, four of our leases with three different tenants were recognized on a cash basis due to the full collectability of the remaining rental payments under the respective leases not being deemed probable. Certain other leases provide for additional rental payments that are based on a percentage of the gross crop revenues earned on the farm, which we refer to as participation rents. Such contingent revenue is generally recognized when all contingencies have been resolved and when actual results become known or estimable, enabling us to estimate and/or measure our share of such gross revenues. As a result, depending on the circumstances of each lease, certain participation rents may be recognized by us in the year the crop was harvested, while other participation rents may be recognized in the year following the harvest. Deferred rent receivable, included in Other assets on the accompanying Consolidated Balance Sheets, includes the cumulative difference between rental revenue as recorded on a straight-line basis and cash rents received from the tenants in accordance with the lease terms. In addition, we determine, in our judgment, to what extent the deferred rent receivable applicable to each specific tenant is collectable. We perform a quarterly review of the net deferred rent receivable balance as it relates to straight-line rents and take into consideration the tenant’s payment history, the financial condition of the tenant, business conditions of the industry in which the tenant operates, and economic and agricultural conditions in the geographic area in which the property is located. In the event that the collectability of deferred rent with respect to any given tenant is in doubt, we record a direct write-off of the specific rent receivable, with a corresponding adjustment to lease revenue. Tenant recovery revenue includes payments received from tenants as reimbursements for certain operating expenses, such as property taxes, insurance premiums, and water delivery costs. These expenses and their subsequent reimbursements are 75 Table of Content recognized under property operating expenses as incurred and lease revenue as earned, respectively, and are recorded in the same periods. We generally do not record any lease revenue or property operating expenses associated with costs paid directly by our tenants for net-leased properties. Other Operating Revenue Other operating revenue consists of non-lease revenue generated as a result of activities performed on certain of our properties. During the years ended December 31, 2024 and 2023, we recognized approximately $ 453,000 and $ 79,000 , respectively, of non-cash revenue, in the form of groundwater credits, associated with the transfer and storing of surplus water on behalf of a government municipality using a groundwater recharge facility constructed on one of our farms. The timing of revenue recognition generally occurs once water credits are recognized by the respective water district at the estimated fair value of the resulting water credits. See Note 3, “ Real Estate and Intangible Assets—Investments in Water Assets ,” for further discussion. Gain (loss) on Dispositions of Real Estate Assets We recognize net gains (losses) on dispositions of real estate assets either upon the abandonment of an asset before the end of its useful life or upon the closing of a transaction (be it an outright sale of a property or the sale of a perpetual, right-of-way easement on all or a portion of a property) with the purchaser. When a real estate asset is abandoned prior to the end of its useful life, a loss is recorded in an amount equal to the net book value of the related real estate asset at the time of abandonment. In the case of a sale of a property, a gain (loss) is recorded to the extent that the total consideration received for a property is more (less) than the property’s net carrying value, plus any closing costs incurred, at the time of the sale. Gains are recognized using the full accrual method (i.e., when the collectability of the sales price is reasonably assured, we are not obligated to perform additional activities that may be considered significant, the initial investment from the buyer is sufficient, and other profit recognition criteria have been satisfied). Gains on sales of real estate assets may be deferred in whole or in part until the requirements for gain recognition have been met. Other Income We record non-operating and unusual or infrequent income as Other income on our Consolidated Statements of Operations. Other income recorded for the years ended December 31, 2024, 2023, and 2022 was primarily from interest patronage received on certain of our long-term borrowings and interest earned on short-term investments. Involuntary Conversions and Property and Casualty Recovery We account for involuntary conversions, for example, when a nonmonetary asset, such as property or equipment, is involuntarily converted to a monetary asset, such as insurance proceeds, in accordance with ASC 605, “Revenue Recognition,” which requires us to recognize a gain or a loss equal to the difference between the carrying amount of the nonmonetary asset and the amount of monetary assets received. Further, in accordance with ASC 450, “Contingencies,” recovery of the loss is considered to be probable, we will recognize a receivable for the amount expected to be covered by insurance proceeds, not to exceed the related loss recognized, unless such amounts have been realized. Income Taxes We have operated and intend to continue to operate in a manner that will allow us to qualify as a REIT under the Sections 856-860 of the Internal Revenue Code of 1986, as amended (the “Code”). Beginning with our tax year ended December 31, 2013, we elected to be taxed as a REIT for federal income tax purposes, and Land Advisers has been treated as a wholly-owned TRS that is subject to federal and state income taxes. As a REIT, we generally are not subject to federal corporate income taxes on amounts that we distribute to our stockholders (except income from any foreclosure property), provided that, on an annual basis, we distribute at least 90% of our REIT taxable income (excluding net capital gains) to our stockholders and meet certain other conditions. To the extent that we satisfy the annual distribution requirement but distribute less than 100% of our taxable income (including net capital gains), we will be subject to corporate income tax on our undistributed taxable income. If we fail to qualify as a REIT in any taxable year, we will be subject to federal income tax on our taxable income at regular corporate rates (including any alternative minimum tax) and may not be able to qualify as a REIT for the four immediately-subsequent taxable years. Even as a REIT, we may be subject to certain state and local income and property taxes and to federal income and excise taxes on undistributed taxable income. In general, however, as long as we qualify as a REIT, no provision for federal income taxes will be necessary, except for taxes on undistributed REIT taxable income and taxes on the income generated by a TRS (such as Land Advisers), if any. Should we have any taxable income or loss in the future, we will account for any income taxes in accordance with the provisions of ASC 740, “Income Taxes” (“ASC 740”), using the asset and liability method. Under this method, deferred tax 76 Table of Content assets and liabilities are recognized based on differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax basis (including for operating loss, capital loss, and tax credit carryforwards) and are calculated using the enacted tax rates and laws expected to be in effect when such amounts are realized or settled. In addition, we will establish valuation allowances for tax benefits when we believe it is more-likely-than-not (defined as a likelihood of more than 50%) that such assets will not be realized. We perform an annual review for any uncertain tax positions and, if necessary, will record future tax consequences of uncertain tax positions in the financial statements. An uncertain tax position is defined as a position taken or expected to be taken in a tax return that is not based on clear and unambiguous tax law and which is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. As of December 31, 2024 and 2023, we had no provisions for uncertain tax positions. The prior three tax years remain open for an audit by the Internal Revenue Service. Comprehensive Income We record the effective portion of changes in the fair value of the interest rate swap agreements that qualify as cash flow hedges to accumulated other comprehensive income. For the years ended December 31, 2024, 2023, and 2022, we reconciled Net income attributable to the Company to Comprehensive income attributable to the Company on the accompanying Consolidated Statements of Operations and Comprehensive Income. Segment Reporting In November 2023, the Financial Accounting Standards Board (“FASB”) issued accounting standard update (“ASU”) 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures,” to improve reportable segments’ disclosure requirements, primarily through enhanced disclosures about significant segment expenses. T he standard requires expanded disclosures regarding significant segments’ expense categories and a measure of profit or loss for each reportable segment. The standard requires additional disclosures around significant segment expenses and the identification, title, and position of the company’s chief operating decision maker (“CODM”). The pronouncement is effective for the fiscal year ended December 31, 2024, and interim periods thereafter. The Company adopted ASU 2023-07 as of December 31, 2024. Our current business strategy includes one operating segment: Real Estate Rental Operations. We generate revenues, earnings, net income, and cash flows through our single segment by collecting rents from our tenants through operating leases, including reimbursements for certain of our property operating costs. We expect to generate earnings growth by increasing rents, maintaining high occupancy rates, and controlling expenses. The primary driver of our revenue growth will be the renewal of existing leases at current market rental rates upon expiration and the acquisition of new properties. We further believe our active portfolio management, combined with the skills of our asset management team, will allow us to maximize net income across our portfolio. Our CODM is our President and CEO. Our CODM uses net income to make decisions about allocating resources to individual properties and assessing performance. The CODM will sometimes reference other metrics, including net operating income; however, as net income is the measure most consistent with the amounts disclosed in the consolidated financial statements, only net income is disclosed. Recently-Issued Accounting Pronouncements In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income–Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses” (“ASU 2024-03”). ASU 2024-03 requires public entities to disaggregate specific types of expenses, including disclosures for depreciation, intangible asset amortization, and selling expenses. The pronouncement is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Prospective application is required, and retrospective application or early adoption is permitted. We are currently assessing the impact of the requirements on our consolidated financial statements and disclosures. NOTE 3. REAL ESTATE AND INTANGIBLE ASSETS All of our properties are wholly-owned on a fee-simple basis, except where noted. The following table provides certain summary information about the 157 farms we owned as of December 31, 2024 (dollars in thousands, except for footnotes): 77 Table of Content Location No. of Farms Total Acres Farm Acres Acre-feet of Water Assets Net Cost Basis (1) Encumbrances (2) California (3)(4)(5) 63 34,845 32,321 55,387 $ 840,374 $ 372,780 Florida (6) 25 18,720 13,891 — 166,471 76,917 Washington 6 2,520 2,004 — 56,171 15,196 Arizona (7) 6 6,320 5,333 — 49,840 11,939 Colorado 12 32,773 25,577 — 45,579 13,849 Nebraska (6) 9 7,782 7,050 — 29,898 9,912 Oregon (8) 6 898 736 — 28,991 10,873 Michigan 12 1,245 778 — 15,204 8,663 Texas 1 3,667 2,219 — 8,026 — Maryland 6 987 863 — 7,948 4,218 South Carolina 3 597 447 — 3,452 2,100 Georgia 2 230 175 — 2,222 1,600 North Carolina 2 310 295 — 2,076 — New Jersey 3 116 101 — 2,059 1,185 Delaware 1 180 140 — 1,280 677 Totals 157 111,190 91,930 55,387 $ 1,259,591 $ 529,909 (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 and Lease intangibles, net; plus Real estate and related assets held for sale, net; plus long-term water assets, net above-market lease values, net lease incentives, and net 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 Consolidated Balance Sheets. (2) Excludes approximately $ 2.4 million of debt issuance costs related to notes and bonds payable, included in Notes and bonds payable, net on the accompanying Consolidated Balance Sheets. (3) Includes ownership in a special-purpose LLC that owns a pipeline conveying water to certain of our properties. As of December 31, 2024, this investment had a net carrying value of approximately $ 962,000 and is included within Other assets, net on the accompanying Consolidated Balance Sheet. (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 December 31, 2024, these two ground leases had a net cost basis of approximately $ 651,000 and are included in Lease intangibles, net on the accompanying Consolidated Balance Sheets. (5) Includes 48,309 acre-feet of water stored with Semitropic Water Storage District, located in Kern County, California, and 7,078 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 certain properties classified as held for sale; see “— Real Estate Held for Sale ” below for additional information. (7) 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 December 31, 2024, these ground leases had an aggregate net cost basis of approximately $ 42,000 and are included in Lease intangibles, net on the accompanying Consolidated Balance Sheets. (8) Includes ownership in a special-purpose LLC that owns certain irrigation infrastructure that provides water to two of our farms. As of December 31, 2024, this investment had a net carrying value of approximately $ 4.7 million and is included within Other assets, net on the accompanying Consolidated Balance Sheets. Real Estate The following table sets forth the components of our investments in tangible real estate assets as of December 31, 2024 and 2023, excluding real estate held for sale (dollars in thousands): December 31, 2024 December 31, 2023 Real estate: Land and land improvements $ 743,141 $ 792,277 Permanent plantings 349,761 359,131 Irrigation and drainage systems 169,098 168,545 Farm-related facilities 49,063 50,517 Other site improvements 13,569 13,272 Real estate, at cost 1,324,632 1,383,742 Accumulated depreciation ( 167,782 ) ( 142,212 ) Real estate, net $ 1,156,850 $ 1,241,530 Real estate depreciation expense on these tangible assets was approximately $ 34.0 million, $ 36.1 million, and $ 34.3 million for the years ended December 31, 2024, 2023, and 2022, respectively. 78 Table of Content Intangible Assets and Liabilities The following table summarizes the carrying value of certain lease intangible assets and the related accumulated amortization as of December 31, 2024 and 2023, excluding lease intangible assets related to real estate held for sale (dollars in thousands): December 31, 2024 December 31, 2023 Lease intangibles: Leasehold interest – land $ 3,372 $ 4,295 In-place lease values 1,798 2,470 Leasing costs 2,280 3,017 Other (1) 117 141 Lease intangibles, at gross cost 7,567 9,923 Accumulated amortization ( 3,979 ) ( 5,141 ) Lease intangibles, net $ 3,588 $ 4,782 (1) Other consists primarily of acquisition-related costs allocated to miscellaneous lease intangibles. Total amortization expense related to these lease intangible assets was approximately $ 1.1 million, $ 1.0 million, and $ 1.0 million for the years ended December 31, 2024, 2023, and 2022, respectively. The following table summarizes the carrying values of certain lease intangible assets or liabilities (excluding those related to real estate held for sale) included in Other assets, net or Other liabilities, net, respectively, on the accompanying Consolidated Balance Sheets and the related accumulated amortization or accretion, respectively, as of December 31, 2024 and 2023 (dollars in thousands): December 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 (1) $ 695 $ ( 198 ) $ 695 $ ( 121 ) Below-market lease values (2) ( 1,371 ) 561 ( 1,944 ) 624 Lease incentives and other deferred revenue, net (3) 14,192 ( 3,691 ) 675 ( 126 ) $ 13,516 $ ( 3,328 ) $ ( 574 ) $ 377 (1) Included as part of Other assets, net on the accompanying Consolidated Balance Sheets, and the related amortization is recorded as a reduction of Lease revenue, net on the accompanying Consolidated Statements of Operations and Comprehensive Income. (2) Included as a part of Other liabilities, net on the accompanying Consolidated Balance Sheets, and the related accretion is recorded as an increase to Lease revenue, net on the accompanying Consolidated Statements of Operations and Comprehensive Income. (3) Lease incentives are included as part of Other assets, net on the accompanying Consolidated Balance Sheets, and the related amortization is recorded as a reduction of Lease revenue, net on the accompanying Consolidated Statements of Operations and Comprehensive Income. Other deferred revenue is primarily attributable to tenant-funded improvements and is included as a part of Other liabilities, net on the accompanying Consolidated Balance Sheets, and the related accretion is recorded as an increase to Lease revenue, net on the accompanying Consolidated Statements of Operations and Comprehensive Income. For the years ended December 31, 2024, 2023, and 2022, total amortization related to above-market lease values was approximately $ 77,000 , $ 77,000 , and $ 37,000 , respectively; total accretion related to below-market lease values was approximately $ 511,000 , $ 172,000 and $ 178,000 , respectively; and total net (amortization) accretion related to lease incentives and other deferred revenue, net was approximately $( 2.5 ) million, $( 629,000 ), and $ 341,000 , respectively. The estimated aggregate amortization expense to be recorded related to in-place lease values, leasing costs, and tenant relationships and the estimated net impact on lease revenue from the amortization of above-market lease values and lease incentives or accretion of above-market lease values and other deferred revenues for each of the five succeeding fiscal years and thereafter is as follows (dollars in thousands): 79 Table of Content Period Estimated Amortization Expense Estimated Net Increase (Decrease) to Lease Revenue For the fiscal years ending December 31: 2025 $ 443 $ ( 9,490 ) 2026 983 ( 39 ) 2027 326 1 2028 324 ( 83 ) 2029 382 ( 126 ) Thereafter 1,130 ( 451 ) $ 3,588 $ ( 10,188 ) Acquisitions We did not acquire any new farms during either of the years ended December 31, 2024 or 2023. Property Sales 2024 Property Sales In January 2024, we completed the sale of a 3,748 -acre farm in Florida for approximately $ 65.7 million. Including closing costs, we recognized a net gain on the sale of approximately $ 10.4 million. In December 2024, we completed the sale of 11 farms (consisting of 647 gross acres of farmland) in Michigan for approximately $ 5.0 million. During the three months ended September 30, 2024, we recognized an impairment charge of approximately $ 2.1 million related to these farms and, upon completing the sale of these farms in December 2024, recognized an aggregate net loss (inclusive of closing costs) of approximately $ 432,000 . 2023 Property Sales In June 2023, we completed the sale of a 138 -acre parcel of unfarmed land in Florida for $ 9.6 million. Including closing costs, we recognized a net gain on the sale of approximately $ 6.4 million. Real Estate Held for Sale As of December 31, 2024, we had three properties (consisting of seven farms) that were classified as held for sale. As of December 31, 2024, one property (consisting of five farms), located in Florida, had a net cost basis of approximately $ 36.3 million, and two properties (consisting of two farms), located in Nebraska, had an aggregate net cost basis of approximately $ 10.0 million. Each of these sales was completed subsequent to December 31, 2024; see Note 11, “ Subsequent Events—Portfolio Activity—Property Sales ,” for additional information on these sales. As of December 31, 2023, we had one property located in Florida that was classified as held for sale. As of December 31, 2023, this property had a net cost basis of approximately $ 53.6 million and was sold in January 2024, as noted above. Investments in Unconsolidated Entities In connection with the acquisition of certain farmland located in Fresno County, California, we also acquired an ownership in a related limited liability company (the “Fresno LLC”), the sole purpose of which is to own and maintain a pipeline conveying water to our and other neighboring properties. In addition, in connection with the acquisition of certain farmland located in Umatilla County, Oregon, we also acquired an ownership in a related limited liability company (the “Umatilla LLC”), the sole purpose of which is to own and maintain an irrigation system providing water to our and other neighboring properties. As of December 31, 2024, our aggregate ownership interest in the Fresno LLC and the Umatilla LLC was 50.0 % and 20.5 %, respectively. As our investments in the Fresno LLC and Umatilla LLC are both deemed to constitute “significant influence,” we have accounted for these investments under the equity method. During the years ended December 31, 2024, 2023, and 2022, we recorded an aggregate loss of approximately $ 60,000 , $ 59,000 , and $ 73,000 , respectively (included in Loss from investments in unconsolidated entities on our Consolidated Statements of Operations and Comprehensive Income), which represents our pro-rata share of the aggregate loss recognized by the Fresno LLC and Umatilla LLC. As of December 31, 2024 and 2023, our combined ownership interest in the Fresno LLC and Umatilla LLC had an aggregate carrying value of approximately $ 5.7 million and $ 5.8 million, respectively, and is included within Other assets, net on the accompanying Consolidated Balance Sheets. 80 Table of Content Investments in Water Assets Semitropic Water Storage District Banked Water In connection with the acquisition of certain farmland located in Kern County, California, in 2021, we also acquired three contracts to purchase an aggregate of 45,000 acre-feet of banked water held by Semitropic Water Storage District (“SWSD”), a water storage district located in Kern County, California. Subsequently in 2021, we executed all three contracts to purchase all 45,000 acre-feet of banked water for an aggregate additional cost of approximately $ 2.8 million. In addition, since the initial acquisition, additional contracts to purchase banked water held by SWSD were conveyed to us by one of our tenants as partial consideration for rent payments owed. The following table summarizes the total acre-feet of banked water obtained through exercising these contracts as of December 31, 2024 (dollars in thousands): Period Acquired Acre-feet of Banked Water Available to Purchase per Contract Acre-feet of Banked Water Purchased (1) Value Attributed to Contract (2) Cost to Exercise Contract Total Carrying Value of Banked Water Purchased Three months ended December 31, 2023 1,003 1,003 $ 401 $ 62 $ 463 Three months ended March 31, 2024 2,306 2,306 923 141 1,064 Total 3,309 3,309 $ 1,324 $ 203 $ 1,527 (1) All contracts to purchase additional banked water were exercised in the same quarter in which the respective contract was conveyed to us. (2) Represents noncash income received during the respective periods. The straight-line impact of these receipts is included within Lease revenue, net on the accompanying Consolidated Statements of Operations and Comprehensive Income. All banked water acquired was recognized at cost, including the subsequent cost to execute the contracts and any administrative fees necessary to transfer the water to our banked water account. As of December 31, 2024, the 48,309 acre-feet of banked water held by SWSD was recognized as a long-term water asset and had an aggregate carrying value of approximately $ 35.5 million (included within Other assets, net on our Consolidated Balance Sheets). Westlands Water District Groundwater Credits In addition, from May 2023 through March 2024, we elected to participate in a groundwater recharge program established by Westlands Water District (“WWD”), a water district located in Fresno County, California. Under the program, WWD paid for surplus surface water to be delivered to individual landowners’ properties with district-approved groundwater recharge facilities, also known as “water banks.” The landowner was allowed to keep 50 % of the net amount of groundwater credits generated under the program (after allowing for certain leave-behind and evaporative losses), and the remaining 50 % was used to recharge the aquifer and retained by WWD. Delivery of water under this program was subject to surplus water availability at WWD’s discretion. WWD terminated the program for the 2024 water year effective March 5, 2024. Through December 31, 2024, we have recognized 2,660 acre-feet of water credits, which represents 50 % of the total net water credits generated and confirmed by WWD under the program as of such date. As of December 31, 2024, these water credits were recognized as a long-term water asset and had an aggregate carrying value of approximately $ 753,000 (included within Other assets, net on our Consolidated Balance Sheets) . In addition, as a result of being granted these water credits in exchange for transferring and storing this surplus water on behalf of WWD, during the years ended December 31, 2024 and 2023, we recognized approximately $ 453,000 and $ 79,000 , respectively, of non-cash revenue, which represents the estimated fair value of the water credits obtained during the respective years. Other Groundwater Credits During 2023 and 2024, we also entered into various other agreements with certain third parties (including local water districts and private individuals) to either buy water directly, buy a portion of other water districts’ surface water allocations in future years in which allocations are granted, or to store surface water on others’ behalf in one of our groundwater recharge facilities in exchange for a portion of the net groundwater credits produced and recognized by the respective water district. Through December 31, 2024, we have obtained 4,419 acre-feet of water credits as a result of these agreements, which were recognized as a long-term water asset with an aggregate carrying value of approximately $ 653,000 (included within Other assets, net on our Consolidated Balance Sheets). Total Long-term Water Assets As of December 31, 2024 and 2023, we owned a total of 55,387 acre-feet and 46,400 acre-feet, respectively, of long-term water assets, and our investments in these long-term water assets had an aggregate carrying value of approximately $ 36.9 million and $ 34.6 million, respectively, and are included within Other assets, net on our Consolidated Balance Sheets. We have invested approximately $ 1.4 million to construct groundwater recharge facilities on two of our farms, which is included within Real estate, at cost on our Consolidated Balance Sheets. In addition, through December 31, 2024, we have 81 Table of Content invested an additional $ 3.3 million in the aggregate in connection with certain agreements that are expected to result in additional groundwater credits in the future; however, the amount and timing of these credits, if any, is currently unknown and is dependent upon and subject to the recognition of such credits by the respective water districts, in their sole discretion. Such costs are held in a deferred asset account (also included within Other assets, net on our Consolidated Balance Sheets) until the related net water credits become estimable and are recognized by the respective water district, at which time the costs would be reclassed to investments in long-term water assets. Future Minimum Lease Payments We account for all of our leasing arrangements in which we are the lessor as operating leases. The majority of our leases are subject to fixed rental increases, and a small subset of our lease portfolio includes lease payments based on an index, such as the consumer price index (“CPI”). In addition, several of our leases contain participation rent components based on the gross revenues earned on the respective farms. Most of our leases also include tenant renewal options; however, these renewal options are generally based on then-current market rental rates and are therefore typically excluded from the determination of the minimum lease term. The majority of our leases generally do not include tenant termination options. The following tables summarize the future net lease payments to be received under noncancellable leases as of December 31, 2024 (dollars in thousands): Period Tenant Lease Revenue (1) For the fiscal years ending December 31, 2025 $ 55,225 2026 57,435 2027 54,170 2028 45,635 2029 42,287 Thereafter 141,060 $ 395,812 (1) Amounts are net of fixed lease incentive payments owed to tenants under certain lease agreements and excludes contingent rental payments, such as participation rents. Portfolio Concentrations Credit Risk As of December 31, 2024, our farms were leased to various different, unrelated third-party tenants, with certain tenants leasing more than one farm. No individual tenant represented greater than 10.0% of the total lease revenue recorded during the year ended December 31, 2024. Geographic Risk Farms located in California and Florida accounted for approximately $ 58.1 million ( 68.5 %) and $ 12.1 million ( 14.2 %), respectively, of the total lease revenue recorded during the year ended December 31, 2024. We seek to continue to further diversify geographically, as may be desirable or feasible. If an unexpected natural disaster (such as an earthquake, wildfire, or flood, or hurricane) occurs or climate change impacts the regions where our properties are located, there could be a material adverse effect on our financial performance and ability to continue operations. To date, none of our farms have been materially impacted by natural disasters, including the January 2025 wildfires that occurred in southern California. See “ —California Floods ” and “ —Southeastern U.S. Hurricanes ” below for a discussion on damage caused on certain of our farms by the January 2023 floods that occurred in California and by the hurricanes that occurred in the Southeastern U.S. in September and October 2024. Besides California and Florida, no other single state accounted for more than 10.0% of the total rental revenue recorded during the year ended December 31, 2024. California Floods In January 2023, periods of heavy rainfall in California resulted in floods that impacted several areas of the state, including regions where certain of our farms are located. As a result of the flooding, one of our farms in the Central Valley suffered damage to certain structures located on the farm, and we estimated the carrying value of such structures to be approximately $ 855,000 . As such, during the year ended December 31, 2023, we wrote down the carrying value of these structures and also recorded a corresponding property and casualty loss, included within Property and casualty loss, net on our Consolidated 82 Table of Content Statements of Operations and Comprehensive Income. Certain of our other farms in California suffered minor damage as a result of the floods, but no other farms were materially impacted. In addition, in February 2024, certain parts of California, particularly the southern part of the state, experienced a “one-in-one-thousand year” rainfall event, as atmospheric river storms caused widespread flooding and mudslides in multiple areas. Certain of our farms suffered minor damage as a result of the storms, but no farms were materially impacted. Southeastern U.S. Hurricanes In September and October 2024, Hurricanes Helene and Milton caused widespread destruction across many states in the Southeastern U.S., including areas where several of our farms are located. As a result of Hurricane Helene in September 2024, one of our farms in Georgia suffered damage to certain permanent plantings on the farm, and we estimated the carrying value of such plantings to be approximately $ 275,000 . As such, during the year ended December 31, 2024 , we wrote down the carrying value of these plantings and also recorded a corresponding property and casualty loss, included within Property and casualty loss, net on our Consolidated Statements of Operations and Comprehensive Income. Certain of our other farms in the region suffered minor damage as a result of Hurricanes Helene and Milton, but no other farms were materially impacted. Impairment We evaluate our entire portfolio each quarter for any impairment indicators and perform an impairment analysis on those select properties and water assets that have an indication of impairment. If this analysis indicates that the carrying value may not be recoverable, an impairment loss is recorded in earnings equal to the amount by which the carrying value exceeds the fair value of the asset. During the three months ended September 30, 2024, as a result of shortening our assumed holding periods for certain farms, we recognized an aggregate impairment charge of approximat ely $ 2.1 million on portions of four properties (encompassing a total of 11 farms) located in Allegan and Van Buren, Michigan, due to the estimated fair values being lower than the respective carrying values. Our estimates of fair value as of September 30, 2024, were determined based on expected sales prices per certain agreements entered into during October 2024. These farms were sold in December 2024 at an additional net loss of approximately $ 432,000 . We did not record any impairment charges during 2023. NOTE 4. BORROWINGS Our borrowings as of December 31, 2024 and 2023 are summarized below (dollars in thousands): Carrying Value as of As of December 31, 2024 December 31, 2024 December 31, 2023 Stated Interest Rates (1) (Range; Wtd Avg) Maturity Dates (Range; Wtd Avg) Variable-rate revolving lines of credit $ 3,600 $ 200 6.60 % 12/15/2033 Notes and bonds payable: Fixed-rate notes payable $ 493,363 $ 524,199 2.45 %– 6.97 %; 3.71 % 2/14/2025 -7/1/2051; April 2033 Fixed-rate bonds payable 32,946 52,640 3.13 %– 4.57 %; 3.85 % 7/24/2025 - 12/30/2030; Jan 2028 Total notes and bonds payable 526,309 576,839 Debt issuance costs – notes and bonds payable ( 2,387 ) ( 2,928 ) N/A N/A Notes and bonds payable, net $ 523,922 $ 573,911 Total borrowings, net $ 527,522 $ 574,111 (1) Where applicable, stated interest rates are before interest patronage (as described below). As of December 31, 2024, the above borrowings were collateralized by certain of our farms with an aggregate net book value of approximately $ 1.0 billion. The weighted-average stated interest rate charged on the above borrowings (excluding the impact of debt issuance costs and before any interest patronage, or refunded interest) was 3.82 % and 3.79 % for the years ended December 31, 2024 and 2023, respectively. In addition, 2023 interest patronage from our Farm Credit Notes Payable (as defined below) resulted in a 22.0 % reduction (approximately 101 basis points) to the stated interest rates on such borrowings. See below under “— Farm Credit Notes Payables—Interest Patronage” for further discussion on interest patronage. We generally borrow at a rate of 60 % of the value of the underlying agricultural real estate, and, except as noted herein, the amounts borrowed are not generally guaranteed by the Company. Our loan agreements generally contain various affirmative 83 Table of Content and negative covenants, including with respect to liens, indebtedness, mergers, and asset sales, and customary events of default. These agreements may also require that we satisfy certain financial covenants at the end of each calendar quarter or year. Some of these financial covenants include, but are not limited to, staying below a maximum leverage ratio and maintaining a minimum net worth value, rental-revenue-to-debt ratio, current ratio, and fixed charge coverage ratio. As of December 31, 2024, we were in compliance with all covenants applicable to the above borrowings. MetLife Facility As amended, our credit facility with Metropolitan Life Insurance Company (“MetLife”) consists of $ 75.0 million of revolving equity lines of credit (the “MetLife Lines of Credit”), a $ 75.0 million long-term note payable (the “2020 MetLife Term Note”), and a $ 100.0 million long-term note payable (the “2022 MetLife Term Note,” and together with the MetLife Lines of Credit and the 2020 MetLife Term Note, the “MetLife Facility”). The following table summarizes the pertinent terms of the MetLife Facility as of December 31, 2024 (dollars in thousands, except for footnotes): Issuance Aggregate Commitment Maturity Dates Principal Outstanding Interest Rate Terms Undrawn Commitment (1) MetLife Lines of Credit $ 75,000 12/15/2033 $ 3,600 3M SOFR + 2.00 % (2) $ 71,400 2020 MetLife Term Note 75,000 (3) 1/5/2030 36,900 2.75 %, fixed through 1/4/2030 (4) 38,100 2022 MetLife Term Note 100,000 (3) 1/5/2032 — (4) 100,000 Totals $ 250,000 $ 40,500 $ 209,500 (1) Based on the properties that were pledged as collateral under the MetLife Facility, as of December 31, 2024, the maximum additional amount we could draw under the facility was approximately $ 105.9 million. (2) The interest rate on the MetLife Lines of Credit is subject to a minimum annualized rate of 2.50 %, plus an unused fee ranging from 0.10 % to 0.20 % on undrawn amounts (based on the balance drawn under each line of credit). (3) If the aggregate commitments under the 2020 MetLife Term Note and the 2022 MetLife Term Note are not fully utilized by December 31, 2026, MetLife has no obligation to disburse the additional funds under either note. (4) Interest rates on future disbursements under each of the 2020 MetLife Term Note and the 2022 MetLife Term Note will be based on prevailing market rates at the time of such disbursements. In addition, through December 31, 2026, the 2020 MetLife Term Note and the 2022 MetLife Term Note are each subject to an unused fee ranging from 0.10 % to 0.20 % on undrawn amounts (based on the balance drawn under the respective note). Under the MetLife Facility, we are generally allowed to borrow up to 60 % of the aggregate of the lower of cost or the appraised value of the pool of agricultural real estate pledged as collateral. Amounts owed to MetLife under the MetLife Facility are guaranteed by us and each subsidiary of ours that owns a property pledged as collateral pursuant to the loan documents. Farmer Mac Facility Through certain subsidiaries of our Operating Partnership, we have entered into a bond purchase agreement (the “Bond Purchase Agreement”) with Federal Agricultural Mortgage Corporation (“Farmer Mac”) and Farmer Mac Mortgage Securities Corporation (the “Bond Purchaser”) for a secured note purchase facility (the “Farmer Mac Facility”). As amended, the Farmer Mac Facility currently provides for bond issuances through December 31, 2026, up to an aggregate amount of $ 225.0 million, and the final maturity date for new bonds issued under the facility will be the date that is ten years from the applicable issuance date. We did not issue any new bonds under the Farmer Mac Facility during either of the years ended December 31, 2024 or 2023. Pursuant to the Bond Purchase Agreement, bonds issued by us to the Bond Purchaser will be secured by a security interest in loans originated by us (pursuant to a pledge and security agreement), which, in turn, will be collateralized by first liens on agricultural real estate owned by subsidiaries of ours. The bonds issued generally have a maximum aggregate, effective loan-to-value ratio of 60 % of the underlying agricultural real estate, after giving effect to certain overcollateralization obligations. As of December 31, 2024, we had approximately $ 32.9 million of bonds issued and outstanding under the Farmer Mac Facility. Farm Credit Notes Payable From time to time since September 2014, we, through certain subsidiaries of our Operating Partnership, have entered into various loan agreements (collectively, the “Farm Credit Notes Payable”) with various different Farm Credit associations (collectively, “Farm Credit”). We did not enter into any new loan agreements with Farm Credit during either of the years ended December 31, 2024 or 2023. Certain amounts owed under the Farm Credit Notes Payable, limited to 12 months of principal and interest due under certain of the loans, are guaranteed by us pursuant to the respective loan documents. 84 Table of Content Interest Patronage Interest patronage, or refunded interest, on our borrowings from Farm Credit is generally recorded upon receipt and is included within Other income on our Consolidated Statements of Operations and Comprehensive Income. Receipt of interest patronage typically occurs in the first half of the calendar year following the calendar year in which the respective interest expense is accrued. During the three months ended March 31, 2024, we recorded interest patronage of approximately $ 1.9 million related to interest accrued on the Farm Credit Notes Payable during the year ended December 31, 2023, and during the three months ended September 30, 2023, we received approximately $ 111,000 of interest patronage, as certain Farm Credit associations paid a portion of the 2023 interest patronage (which relates to interest accrued during 2023 but is typically paid during the first half of 2024) early. In total, 2023 interest patronage resulted in a 22.0 % reduction (approximately 101 basis points) to the interest rates on such borrowings. Debt Service – Aggregate Maturities Scheduled principal payments of our aggregate notes and bonds payable as of December 31, 2024, for the succeeding years are as follows (dollars in thousands): Period Scheduled Principal Payments For the fiscal years ending December 31: 2025 $ 38,485 2026 17,607 2027 50,785 2028 77,168 2029 152,626 Thereafter 189,638 (1) $ 526,309 (1) Subsequent to December 31, 2024, we repaid approximately $ 19.4 million of notes that were scheduled to mature in 2043 but were set to reprice in 2025. During the year ended December 31, 2024, we repaid approximately $ 33.6 million of notes and bonds that were scheduled to either mature or reprice. On a weighted-average basis, these borrowings bore interest at a fixed, stated rate of 3.69 % and an effective interest rate (after interest patronage) of 3.15 %. Fair Value ASC 820, “Fair Value Measurement (Subtopic 820)” (“ASC 820”), provides a definition of fair value that focuses on the exchange (exit) price of an asset or liability in the principal, or most advantageous, market and prioritizes the use of market-based inputs to the valuation. ASC 820-10 establishes a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows: • Level 1 — inputs that are based upon quoted prices (unadjusted) for identical assets or liabilities in active markets; • Level 2 — inputs are based upon quoted prices for similar assets or liabilities in active or inactive markets or model-based valuation techniques, for which all significant inputs are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and • Level 3 — inputs are generally unobservable and significant to the fair value measurement. These unobservable inputs are generally supported by little or no market activity and are based upon management’s estimates of assumptions that market participants would use in pricing the asset or liability. As of December 31, 2024, the aggregate fair value of our notes and bonds payable was approximately $ 486.3 million, as compared to an aggregate carrying value (excluding unamortized related debt issuance costs) of approximately $ 526.3 million. The fair value of our long-term notes and bonds payable is valued using Level 3 inputs under the hierarchy established by ASC 820-10 and is determined by a discounted cash flow analysis, using discount rates based on management’s estimates of market interest rates on long-term debt with comparable terms. Further, due to the revolving nature and variable interest rates applicable to the MetLife Lines of Credit, their aggregate fair value as of December 31, 2024, is deemed to approximate their aggregate carrying value of $ 3.6 million. Interest Rate Swap Agreements In order to hedge our exposure to variable interest rates, we have entered into various interest rate swap agreements in connection with certain of our mortgage financings. In accordance with these swap agreements, we will pay our counterparty a 85 Table of Content fixed interest rate on a quarterly basis and receive payments from our counterparty equal to the respective stipulated floating rates. We have adopted the fair value measurement provision for these financial instruments, and the aggregate fair value of our interest rate swap agreements is recorded in Other assets, net or Other liabilities, net, as appropriate, on our accompanying Consolidated Balance Sheets. Generally, in the absence of observable market data, we will estimate the fair value of our interest rate swaps using estimates of certain data points, including estimated remaining life, counterparty credit risk, current market yield, and interest rate spreads of similar securities as of the measurement date. In accordance with the Financial Accounting Standards Board’s fair value measurement guidance, we have made an accounting policy election to measure the credit risk of our derivative financial instruments that are subject to master netting agreements on a net basis by counterparty portfolio. As of December 31, 2024, our interest rate swaps were valued using Level 2 inputs. In addition, we have designated our interest rate swaps as cash flow hedges. For derivatives designated and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is initially recorded in Accumulated other comprehensive income (loss) on the accompanying Consolidated Balance Sheets and subsequently reclassified into interest expense in the same period(s) during which the hedged transaction affects. During the next 12 months, we estimate that an additional $ 1.7 million will be reclassified as a reduction to interest expense. We had the following outstanding interest rate derivatives that were designated as cash flow hedges of interest rate risk as of December 31, 2024 and 2023 (dollars in thousands): Period Number of Instruments Aggregate Notional Amount As of December 31, 2024 4 $ 67,067 As of December 31, 2023 4 70,229 The following table presents the fair value of our interest rate swaps and their classification on the Consolidated Balance Sheets as of December 31, 2024 and 2023 (dollars in thousands): Derivative Asset (Liability) Fair Value Derivative Type Balance Sheet Location December 31, 2024 December 31, 2023 Derivatives Designated as Hedging Instruments: Interest rate swaps Other assets, net $ 7,632 $ 7,366 Total $ 7,632 $ 7,366 The following table presents the amount of income (loss) recognized in comprehensive income within our consolidated financial statements for the years ended December 31, 2024, 2023, and 2022 (dollars in thousands): For the Years Ended December 31, 2024 December 31, 2023 December 31, 2022 Derivative in cash flow hedging relationship: Interest rate swaps $ 266 $ ( 1,641 ) $ 10,043 Total $ 266 $ ( 1,641 ) $ 10,043 Credit-risk-related Contingent Features We have agreements with each of our derivative counterparties that contain a provision where if we default on any of our indebtedness, then we could also be declared in default on our derivative obligations. As of December 31, 2024, we did not have any derivatives in a net liability position, nor have we posted any collateral related to these agreements. NOTE 5. MANDATORILY-REDEEMABLE PREFERRED STOCK Series D Term Preferred Stock In January 2021, we completed a public offering of 5.00 % Series D Cumulative Term Preferred Stock, par value $ 0.001 per share (the “Series D Term Preferred Stock”), at a public offering price of $ 25.00 per share. As a result of this offering (including the underwriters’ exercise of their option to purchase additional shares to cover over-allotments), we issued a total of 2,415,000 shares of the Series D Term Preferred Stock for gross proceeds of approximately $ 60.4 million and net proceeds, after deducting underwriting discounts and offering expenses borne by us, of approximately $ 58.3 million. The Series D Term Preferred Stock is traded under the ticker symbol “LANDM” on Nasdaq. The shares of the Series D Term Preferred Stock have a mandatory redemption date of January 31, 2026, and are not convertible into our common stock or any other securities. Generally, we were not permitted to redeem shares of the Series D Term Preferred Stock prior to January 31, 2023, except in limited circumstances to preserve our qualification as a REIT. On or 86 Table of Content after January 31, 2023, we may redeem the shares at a redemption price of $ 25.00 per share, plus any accumulated and unpaid dividends up to, but excluding, the date of redemption. We incurred approximately $ 2.1 million in total offering costs related to this issuance, which have been recorded net of the Series D Term Preferred Stock as presented on the accompanying Consolidated Balance Sheets and are being amortized over the mandatory redemption period as a component of interest expense on the accompanying Consolidated Statements of Operations and Comprehensive Income. The Series D Term Preferred Stock is recorded as a liability on our accompanying Consolidated Balance Sheets in accordance with ASC 480, “Distinguishing Liabilities from Equity,” which states that mandatorily-redeemable financial instruments should be classified as liabilities. In addition, the related dividend payments are treated similarly to interest expense on the accompanying Consolidated Statements of Operations and Comprehensive Income. As of December 31, 2024, the fair value of our Series D Term Preferred Stock was approximately $ 59.5 million, as compared to the carrying value (exclusive of unamortized offering costs) of approximately $ 60.4 million. The fair value of our Series D Term Preferred Stock uses Level 1 inputs under the hierarchy established by ASC 820-10 and is calculated based on the closing per-share price on December 31, 2024, of $ 24.64 . For information on the dividends declared by our Board of Directors and paid by us on the Series D Term Preferred Stock during the year ended December 31, 2024, see Note 8, “ Equity—Distributions .” NOTE 6. RELATED-PARTY TRANSACTIONS Our Adviser and Administrator We are externally managed pursuant to contractual arrangements with our Adviser and our Administrator, which collectively employ all of our personnel and pay their salaries, benefits, and general expenses directly. Both our Adviser and Administrator are affiliates of ours, as their parent company is owned and controlled by David Gladstone, our chairman, chief executive officer, and president. Mr. Gladstone also serves as a director and executive officer of each of our Adviser and Administrator. In addition, Michael LiCalsi, our general counsel and secretary (who also serves as our Administrator’s president, general counsel, and secretary) is executive vice president of administration of our Adviser. We have entered into an investment advisory agreement with our Adviser (the “Advisory Agreement”) and an administration agreement with our Administrator (the “Administration Agreement”). Both the Advisory Agreement and the Administration Agreement were approved unanimously by our Board of Directors, including our independent directors. Our Board of Directors reviews and considers renewing the agreement with our Adviser each July. During its July 2024 meeting, our Board of Directors reviewed and renewed each of the Advisory Agreement and the Administration Agreement for an additional year, through August 31, 2025. A summary of the compensation terms for the Advisory Agreement and a summary of the Administration Agreement is below. Advisory Agreement Pursuant to the Advisory Agreement, our Adviser is compensated in the form of a base management fee and, each as applicable, an incentive fee, a capital gains fee, and a termination fee. Our Adviser does not charge acquisition or disposition fees when we acquire or dispose of properties, as is common in other externally-managed REITs. Each of the base management, incentive, capital gains, and termination fees is described below. Base Management Fee Pursuant to the Advisory Agreement, a base management fee is paid quarterly and is calculated at an annual rate of 0.60 % ( 0.15 % per quarter) of the prior calendar quarter’s “Gross Tangible Real Estate,” defined as the gross cost of tangible real estate owned by us (including land and land improvements, permanent plantings, irrigation and drainage systems, farm-related facilities, and other tangible site improvements), prior to any accumulated depreciation, and as shown on our balance sheet or the notes thereto for the applicable quarter. Incentive Fee Pursuant to the Advisory Agreement, an incentive fee is calculated and payable quarterly in arrears if the Pre-Incentive Fee FFO for a particular quarter exceeded a hurdle rate of 1.75 % ( 7.0 % annualized) of the prior calendar quarter’s Total Adjusted Common Equity. For purposes of this calculation, Pre-Incentive Fee FFO is defined in the Advisory Agreement as FFO (also as defined in the Advisory Agreement) accrued by the Company during the current calendar quarter (prior to any incentive fee calculation for the current calendar quarter), less any dividends declared on preferred stock securities that were not treated as a liability for GAAP 87 Table of Content purposes. In addition, Total Adjusted Common Equity is defined as common stockholders’ equity plus non-controlling common interests in the Operating Partnership, if any (each as reported on our balance sheet), adjusted to exclude unrealized gains and losses and certain other one-time events and non-cash items. Our Adviser receives: (i) no Incentive Fee in any calendar quarter in which the Pre-Incentive Fee FFO does not exceed the hurdle rate; (ii) 100 % of the Pre-Incentive Fee FFO with respect to that portion of such Pre-Incentive Fee FFO, if any, that exceeds the hurdle rate but was less than 2.1875 % in any calendar quarter ( 8.75 % annualized); and (iii) 20 % of the amount of the Pre-Incentive Fee FFO, if any, that exceeds 2.1875 % in any calendar quarter ( 8.75 % annualized). Capital Gains Fee Pursuant to the Advisory Agreement, a capital gains-based incentive fee is calculated and payable in arrears at the end of each fiscal year (or upon termination of the Advisory Agreement). The capital gains fee shall equal: (i) 15 % of the cumulative aggregate realized capital gains minus the cumulative aggregate realized capital losses, minus (ii) any aggregate capital gains fees paid in prior periods. For purposes of this calculation, realized capital gains and losses will be calculated as (x) the sales price of the property, minus (y) any costs to sell the property and the then-current gross value of the property (which includes the property’s original acquisition price plus any subsequent, non-reimbursed capital improvements). At the end of each fiscal year, if this figure is negative, no capital gains fee shall be paid. Termination Fee Pursuant to the Advisory Agreement, in the event of our termination of the agreement with our Adviser for any reason (with 120 days’ prior written notice and the vote of at least two-thirds of our independent directors), a termination fee would be payable to the Adviser equal to three times the sum of the average annual base management fee and incentive fee earned by the Adviser during the 24-month period prior to such termination. Administration Agreement Pursuant to the Administration Agreement, we pay for our allocable portion of the Administrator’s expenses incurred while performing its obligations to us, including, but not limited to, rent and the salaries and benefits expenses of our Administrator’s employees, including our chief financial officer, treasurer, chief compliance officer, general counsel and secretary (who also serves as our Administrator’s president, general counsel, and secretary), and their respective staffs. As approved by our Board of Directors, our allocable portion of the Administrator’s expenses is generally derived by multiplying our Administrator’s total expenses by the approximate percentage of time the Administrator’s employees perform services for us in relation to their time spent performing services for all companies serviced by our Administrator under similar contractual agreements. Gladstone Securities We have entered into an agreement with Gladstone Securities, LLC (“Gladstone Securities”), for it to act as our non-exclusive agent to assist us with arranging financing for our properties (the “Financing Arrangement Agreement”). Gladstone Securities is a privately-held broker-dealer and a member of the Financial Industry Regulatory Authority and the Securities Investor Protection Corporation. Gladstone Securities is an affiliate of ours, as its parent company is owned and controlled by Mr. Gladstone, who also serves on the board of managers of Gladstone Securities. In addition, Michael LiCalsi, our general counsel and secretary, serves in several capacities for Gladstone Securities, including as its chief legal officer, secretary, a member of its board of managers, and a managing principal. Financing Arrangement Agreement We pay Gladstone Securities a financing fee in connection with the services it provides to us for securing financing on our properties. Depending on the size of the financing obtained, the maximum amount of the financing fee, which will be payable upon closing of the respective financing, will range from 0.5 % to 1.0 % of the amount of financing obtained. The amount of the financing fee may be reduced or eliminated as determined by us and Gladstone Securities after taking into consideration various factors, including, but not limited to, the involvement of any unrelated third-party brokers and general market conditions. During the years ended December 31, 2024, 2023, and 2022, we paid financing fees to Gladstone Securities of $ 0 , $ 0 , and approximately $ 154,000 , respectively. Through December 31, 2024, the total amount of financing fees paid to Gladstone Securities represented approximately 0.14 % of the total financings secured since the Financing Arrangement Agreement has been in place. Dealer-Manager Agreements 88 Table of Content We have entered into dealer-manager agreements with Gladstone Securities (collectively, the “Dealer-Manager Agreements”), pursuant to which Gladstone Securities served or serves as our exclusive dealer-manager in connection with the offering of our 6.00 % Series C Cumulative Redeemable Preferred Stock, par value $ 0.001 per share (the “Series C Preferred Stock”) and our 5.00 % Series E Cumulative Redeemable Preferred Stock, par value $ 0.001 per share (the “Series E Preferred Stock”). Pursuant to the Dealer-Manager Agreements, Gladstone Securities provided or provides certain sales, promotional, and marketing services to us in connection with the offering of the Series C Preferred Stock and Series E Preferred Stock, and we generally paid or pay Gladstone Securities for the following: • With regard to the Series C Preferred Stock: ◦ selling commissions of up to 6.0 % of the gross proceeds from sales in the offering (the “Series C Selling Commissions”), and ◦ a dealer-manager fee of 3.0 % of the gross proceeds from sales in the offering (the “Series C Dealer-Manager Fee”). • With regard to the Series E Preferred Stock: ◦ selling commissions of up to 7.0 % of the gross proceeds from sales in the offering (the “Series E Selling Commissions,” and together with the Series C Selling Commissions, the “Selling Commissions”), and ◦ a dealer-manager fee of 3.0 % of the gross proceeds from sales in the offering (the “Series E Dealer-Manager Fee,” and together with the Series C Dealer-Manager Fee, the “Dealer-Manager Fees”). No Selling Commissions or Dealer-Manager Fees were paid with respect to shares of the Series C Preferred Stock sold pursuant to the DRIP for the Series C Preferred Stock. Gladstone Securities may, in its sole discretion, remit all or a portion of the Selling Commissions and also reallow all or a portion of the Dealer-Manager Fees to participating broker-dealers and wholesalers in support of the offerings. The terms of each of the Dealer-Manager Agreements were approved by our Board of Directors, including all of our independent directors. The following tables summarizes the total Selling Commissions and Dealer-Manager Fees paid to Gladstone Securities during the years ended December 31, 2024, 2023, and 2022 (dollars in thousands): For the Years Ended December 31, 2024 2023 2022 Series C Preferred Stock $ — $ — $ 13,471 Series E Preferred Stock 41 583 — Total Selling Commissions and Dealer-Manager Fees $ 41 $ 583 $ 13,471 Selling Commissions and Dealer-Manager Fees paid to Gladstone Securities are netted against the gross proceeds received from sales of the respective securities and are included within Additional paid-in capital on the accompanying Consolidated Balance Sheets. Related Party Fees The following table summarizes related-party fees paid or accrued for and reflected in our accompanying consolidated financial statements (dollars in thousands): For the Years Ended December 31, 2024 2023 2022 Base management fee (1)(2) $ 8,370 $ 8,603 $ 8,307 Incentive fee (1)(2) 109 1,771 3,225 Incentive fee waiver (2) ( 109 ) — — Total fees to our Adviser $ 8,370 $ 10,374 $ 11,532 Administration fee (1)(2) $ 2,452 $ 2,255 $ 2,005 Selling Commissions and Dealer-Manager Fees (1)(3) $ 41 $ 583 $ 13,471 Financing fees (1)(4) — — 154 Total fees to Gladstone Securities $ 41 $ 583 $ 13,625 (1) Pursuant to the agreements with the respective related-party entities, as discussed above. (2) Reflected as a line item on our accompanying Consolidated Statements of Operations and Comprehensive Income. (3) Included within Additional paid-in capital on the accompanying Consolidated Balance Sheets. 89 Table of Content (4) Included within Notes and bonds payable, net on the Consolidated Balance Sheets and amortized into Interest expense on the Consolidated Statements of Operations and Comprehensive Income. Related-Party Fees Due Amounts due to related parties on our accompanying Consolidated Balance Sheets as of December 31, 2024 and 2023 were as follows (dollars in thousands): December 31, 2024 December 31, 2023 Base management fee $ 2,067 $ 2,156 Incentive fee — 982 Other, net (1) 75 49 Total due to Adviser 2,142 3,187 Administration fee 613 546 Cumulative accrued but unpaid portion of prior Administration Fees (2) 217 141 Total due to Administrator 830 687 Total due to related parties (3) $ 2,972 $ 3,874 (1) Other amounts due to or from our Adviser primarily relate to miscellaneous general and administrative expenses either paid by our Adviser on our behalf or by us on our Adviser’s behalf. (2) Represents the cumulative accrued but unpaid portion of prior Administration fees that are scheduled to be paid during the three months ending September 30 of each year, which is the quarter following our Administrator’s fiscal year end. (3) Reflected as a line item on our accompanying Consolidated Balance Sheets. NOTE 7. COMMITMENTS AND CONTINGENCIES Operating Obligations In connection with the execution of certain lease agreements, we have committed to provide capital improvements on certain of our farms. Below is a summary of certain of those projects for which we have incurred or accrued costs as of December 31, 2024 (dollars in thousands): Farm Locations Farm Acreage Total Commitment Obligated Completion Date (1) Amount Expended or Accrued as of December 31, 2024 Monterey, CA 329 $ 1,100 (2) Q4 2025 $ 30 St. Lucie, FL 549 230 Q3 2025 185 Ventura, CA 402 1,000 (2) Q4 2025 518 Franklin & Grant, WA, & Umatilla, OR 1,126 4,203 (2) Q4 2032 2,903 Wicomico & Caroline, MD, and Sussex, DE 833 155 Q3 2034 49 Charlotte, FL 975 800 (2) Q3 2034 748 (1) Our obligation to provide capital to fund these improvements does not extend beyond these respective dates. (2) Pursuant to contractual agreements, we will earn additional rent on the cost of these capital improvements as the funds are disbursed by us. Ground Lease Obligations In connection with certain farms acquired through leasehold interests, we assumed certain ground lease arrangements under which we are the lessee. These operating ground leases have lease expiration dates ranging from February 2025 through December 2041, and none of these leases contain any extension, renewal, or termination options. At lease commencement, the net present value of the minimum lease payments was determined by discounting the respective future minimum lease payments using a discount rate equivalent to our fully-collateralized borrowing rate ranging from 4.22 % to 8.72 %. 90 Table of Content As of December 31, 2024 and 2023, we recorded the following as a result of these operating ground leases (dollars in thousands, except for footnotes): December 31, 2024 December 31, 2023 Operating lease right-of-use assets (1) $ 521 $ 574 Operating lease liabilities (2) $ 498 $ 568 Weighted-average remaining lease term (years) 14.9 15.0 Weighted-average incremental borrowing rate 8.35 % 8.12 % (1) Operating lease right-of-use assets are shown net of prepaid lease payments of approximately $ 23,000 and $ 6,000 as of December 31, 2024, and 2023, respectively, and are included within Other assets , net on the accompanying Consolidated Balance Sheets. (2) Included within Other liabilities , net on the accompanying Consolidated Balance Sheets. Future minimum lease payments due under the remaining non-cancelable terms of these leases as of December 31, 2024, are as follows (dollars in thousands): Period Future Lease Payments (1) For the fiscal years ending December 31: 2025 $ 62 2026 62 2027 62 2028 62 2029 62 Thereafter 569 Total undiscounted lease payments 879 Less: imputed interest ( 381 ) Present value of lease payments $ 498 (1) Certain annual lease payments are set at the beginning of each year to then-current market rates (as determined by the lessor). The amounts shown above represent estimated amounts based on the lease rates currently in place. As a result of these ground leases, we recorded lease expense (included within Property operating expenses on the accompanying Consolidated Statement of Operations and Comprehensive Income) of approximately $ 105,000 , $ 103,000 , and $ 92,000 during the years ended December 31, 2024, 2023, and 2022, respectively. Litigation In the ordinary course of business incidental to our business, we may be involved in various legal proceedings from time to time which we may not consider material. We are not currently subject to any known material litigation known or, to our knowledge, threatened litigation. NOTE 8. EQUITY Amendment to Articles of Incorporation and Operating Partnership Agreement On November 9, 2022, we amended our articles of incorporation (i) reclassifying and designating 15,551,347 authorized but unissued shares of our Series C Preferred Stock and 1,185,000 authorized but unissued shares of our Series D Term Preferred Stock as shares of common stock, (ii) setting forth the rights, preferences, and terms of the Series E Preferred Stock, and (iii) reclassifying and designating 16,000,000 shares of our authorized and unissued shares of common stock as shares of Series E Term Preferred Stock. In connection with the authorization of the Series E Preferred Stock, we amended our Operating Partnership agreement to provide for the establishment and issuance of an equal number of 5.00 % Series E Cumulative Redeemable Preferred Units (the “Series E Preferred OP Units”) as are issued shares of the Series E Preferred Stock by the Company. Generally, the Series E Preferred OP Units have preferences, distribution rights, and other provisions substantially equivalent to those of the Series E Preferred Stock. Registration Statement On March 28, 2023, we filed a universal registration statement on Form S-3, as amended (File No. 333-270901), with the SEC (the “2023 Registration Statement”) to replace our prior universal registration statement. The 2023 Registration Statement, which was declared effective by the SEC on April 13, 2023, permits us to issue up to an aggregate of $ 1.5 billion in securities 91 Table of Content consisting of common stock, preferred stock, warrants, debt securities, depository shares, subscription rights, and units, including through separate, concurrent offerings of two or more securities. Through December 31, 2024, we have issued a total of 176,195 shares of Series E Preferred Stock for gross proceeds of approximately $ 4.4 million and 470,676 shares of common stock for gross proceeds of approximately $ 6.8 million under the 2023 Registration Statement. See Note 11, “ Subsequent Events ,” for equity issuances completed subsequent to December 31, 2024. Equity Issuances Series C Preferred Stock On April 3, 2020, we filed a prospectus supplement with the SEC for a continuous public offering of our Series C Preferred Stock (the “Series C Offering”). Under the Series C Offering, as amended, we were permitted us to sell up to 10,200,000 shares of our Series C Preferred Stock on a “reasonable best efforts” basis through Gladstone Securities at an offering price of $ 25.00 per share (the “Primary Series C Offering”) and up to 200,000 additional shares of our Series C Preferred Stock pursuant to our dividend reinvestment plan (the “DRIP”) at a price of $ 22.75 per share. The Primary Series C Offering terminated on December 31, 2022, with substantially all of the allotted 10,200,000 shares being sold resulting in total gross proceeds, exclusive of redemptions, of approximately $ 252.6 million and net proceeds, after deducting commissions, dealer-manager fees, and offering expenses payable by us, of approximately $ 230.5 million. The Series C Preferred Stock DRIP was terminated effective March 22, 2023. See Note 6, “Related-Party Transactions—Gladstone Securities—Dealer-Manager Agreements,” for a discussion of the commissions and fees paid to Gladstone Securities in connection with the Series C Offering. We listed the Series C Preferred Stock on Nasdaq under the ticker symbol “LANDP,” and trading commenced on June 8, 2023. During the year ended December 31, 2022, we sold 6,701,987 shares of the Series C Preferred Stock at a weighted average offering price per share of $ 24.76 , resulting in gross proceeds of approximately $ 165.9 million and net proceeds, after deducting commissions and dealer-manager fees, of approximately $ 152.5 million. Additionally, during the years ended December 31, 2023 and 2022, we issued 14,069 shares and 34,628 shares, respectively, of the Series C Preferred Stock pursuant to the DRIP, and 48,913 shares and 38,595 shares, respectively, of the Series C Preferred Stock were tendered for optional redemption, which we satisfied with aggregate cash payments of approximately $ 1.2 million and $ 901,000 , respectively. Series E Preferred Stock On November 9, 2022, we filed a prospectus supplement with the SEC for a continuous public offering (the “Series E Offering”) of up to 8,000,000 shares of our Series E Preferred Stock, on a “reasonable best efforts” basis through Gladstone Securities at an offering price of $ 25.00 per share. See Note 6, “Related-Party Transactions—Gladstone Securities—Dealer-Manager Agreements,” for a discussion of the commissions and fees to be paid to Gladstone Securities in connection with the Series E Offering. The following table provides information on sales of our Series E Preferred Stock during the years ended December 31, 2024 and 2023 (dollars in thousands, except per-share amounts): 2024 2023 Number of shares sold 16,595 237,441 Weighted-average offering price per share $ 24.98 $ 24.96 Gross proceeds $ 414 $ 5,925 Net proceeds (1) $ 373 $ 5,342 (1) Net of Selling Commissions, Dealer-Manager Fees, and underwriting discounts. Refer to Note 11, “Subsequent Events—Equity Activity—Series E Preferred Stock,” for sales of the Series E Preferred Stock completed subsequent to December 31, 2024. In addition, during the year ended December 31, 2023, 1,600 shares of Series E Preferred Stock were tendered for optional redemption, which we satisfied with an aggregate cash payment of approximately $ 36,000 . No shares of the Series E Preferred Stock were tendered for optional redemption during the year ended December 31, 2024. The Series E Offering will terminate on the date (the “Series E Termination Date”) that is the earlier of (i) December 31, 2025 (unless terminated or extended by its Board of Directors) and (ii) the date on which all 8,000,000 shares of Series E Preferred Stock offering in the Series E Offering are sold. There is currently no public market for shares of Series E Preferred Stock. We intend to apply to list the Series E Preferred Stock on Nasdaq or another national securities exchange within one calendar year of the Series E Termination Date; however, there can be no assurance that a listing will be achieved in such timeframe, or at all. 92 Table of Content Common Stock At-the-Market Program We have entered into equity distribution agreements (commonly referred to as “at-the-market agreements”) with Virtu Americas LLC and Ladenburg Thalmann & Co. Inc. (each a “Sales Agent”), that, as amended, currently permit us to issue and sell, from time to time and through the Sales Agents, shares of our common stock having an aggregate offering price of up to $ 500.0 million (the “ATM Program”). The following table provides information on shares of common stock sold under the ATM Program during the years ended December 31, 2024, 2023, and 2022 (dollars in thousands, except per-share amounts): Years Ended December 31, 2024 2023 2022 Number of shares sold 346,216 788,045 840,384 Weighted-average offering price per share $ 13.52 $ 19.34 $ 26.47 Gross proceeds $ 4,680 $ 15,240 $ 22,242 Net proceeds (1) $ 4,633 $ 15,087 $ 21,993 (1) Net of underwriting commissions. Repurchase Program On May 17, 2024, our Board of Directors approved a share repurchase program authorizing us to repurchase up to $ 20.0 million of our 6.00 % Series B Cumulative Redeemable Preferred Stock, par value $ 0.001 per share (the “Series B Preferred Stock”) and up to $ 35.0 million of our Series C Preferred Stock (collectively, the “Repurchase Program”). The Board’s authorization of the Repurchase Program may be suspended or discontinued at any time, does not obligate us to acquire any particular amount of securities, and expires on May 17, 2025. Under the Repurchase Program, repurchases are intended to be implemented through open market transactions on U.S. exchanges and/or in privately-negotiated transactions facilitated by a third-party broker acting as agent for us in accordance with applicable securities laws. Any repurchases will be made during applicable trading window periods or pursuant to applicable Rule 10b5-1 trading plans. The following table summarizes repurchase activity under the Repurchase Program during the year ended December 31, 2024 (dollars in thousands, except per-share amounts): For the year ended December 31, 2024 Series B Preferred Stock: Number of shares repurchased 115,176 Gross repurchase price (1) $ 2,429 Weighted-average repurchase price per share $ 21.09 Gain on repurchase (2) $ 133 Series C Preferred Stock: Number of shares repurchased 201,646 Gross repurchase price (1) $ 4,201 Weighted-average repurchase price per share $ 20.83 Gain on repurchase (2) $ 372 (1) Inclusive of broker commissions. (2) The gain on the repurchase of cumulative redeemable preferred stock is included within Gain (loss) on extinguishment of cumulative redeemable preferred stock, net on our accompanying Consolidated Statements of Operations and Comprehensive Income. Non-Controlling Interests in Operating Partnership We consolidate our Operating Partnership, which is a majority-owned partnership. As of each of December 31, 2024, 2023, and 2022, we owned 100.0 %, of the outstanding OP Units, and there were no OP Units held by non-controlling OP Unitholders. On or after 12 months after becoming a holder of OP Units, each non-controlling OP Unitholder has the right, subject to the terms and conditions set forth in the partnership agreement of the Operating Partnership, to require the Operating Partnership to redeem all or a portion of such units in exchange for cash or, at the Company’s option, shares of our common stock on a one -for-one basis. The cash redemption per OP Unit would be based on the market price of our common stock at the time of redemption. A limited partner will not be entitled to exercise redemption rights if the delivery of common stock to the redeeming limited partner would breach restrictions on the ownership of common stock imposed under our charter and other limitations thereof. 93 Table of Content Regardless of the rights described above, the Operating Partnership will not have an obligation to issue cash to a unitholder upon a redemption request if the Company elects to redeem the OP Units for shares of its common stock. When a non-controlling unitholder redeems OP Units and the Company elects to satisfy that redemption through the issuance of common stock, non-controlling interest in the Operating Partnership is reduced and stockholders’ equity is increased. During the year ended December 31, 2022, we redeemed 204,778 OP Units that were previously issued to noncontrolling OP Unitholders with a cash payment of approximately $ 7.7 million or $ 37.45 per OP Unit. The Operating Partnership is required to make distributions on each OP Unit in the same amount as those paid on each share of the Company’s common stock, with the distributions on the OP Units held by the Company being utilized to make distributions to the Company’s common stockholders. Distributions The per-share distributions to preferred and common stockholders declared by our Board of Directors during the years ended December 31, 2024, 2023, and 2022 are reflected in the table below. For the Years Ended December 31, Issuance 2024 2023 2022 Series B Preferred Stock 1.500000 1.500000 1.500000 Series C Preferred Stock 1.500000 1.500000 1.500000 Series D Term Preferred Stock (1) 1.250004 1.250004 1.250004 Series E Preferred Stock 1.250004 1.250004 — Common Stock (2) 0.559500 0.553500 0.546300 (1) Dividends are treated similar to interest expense on the accompanying Consolidated Statements of Operations and Comprehensive Income. (2) The same amounts were paid as distributions on each OP Unit held by non-controlling OP Unitholders. For federal income tax characterization purposes, distributions paid to stockholders may be characterized as ordinary income, capital gains, return of capital, or a combination thereof. The characterization of distributions on our preferred and common stock during each of the years ended December 31, 2024, 2023, and 2022 is reflected in the following table: Ordinary Income Long-term Capital Gain Return of Capital For the Year Ended December 31, 2024 Series B Preferred Stock 47.178987 % 23.885993 % 28.935020 % Series C Preferred Stock 47.178987 % 23.885993 % 28.935020 % Series D Term Preferred Stock 47.178987 % 23.885993 % 28.935020 % Series E Preferred Stock 47.178987 % 23.885993 % 28.935020 % Common Stock — % — % 100.000000 % For the Year Ended December 31, 2023 Series B Preferred Stock 30.782342 % 22.611772 % 46.605886 % Series C Preferred Stock 30.782342 % 22.611772 % 46.605886 % Series D Term Preferred Stock 30.782342 % 22.611772 % 46.605886 % Series E Preferred Stock 30.782342 % 22.611772 % 46.605886 % Common Stock — % — % 100.000000 % For the Year Ended December 31, 2022 Series B Preferred Stock 34.205000 % — % 65.795000 % Series C Preferred Stock 34.205000 % — % 65.795000 % Series D Term Preferred Stock 34.205000 % — % 65.795000 % Common Stock — % — % 100.000000 % NOTE 9. LEASE REVENUES The following table sets forth the components of our lease revenue for the years ended December 31, 2024, 2023, and 2022 (dollars in thousands, except for footnotes): 94 Table of Content For the Years Ended December 31, 2024 2023 2022 Fixed lease payments (1) $ 73,952 $ 83,695 $ 81,423 Variable lease payments (2) 10,811 6,624 7,813 Lease revenue, net (3) $ 84,763 $ 90,319 $ 89,236 (1) Fixed lease payments include contractual rents under lease agreements with tenants recognized on a straight-line basis over the respective lease terms and includes the amortization of above-market lease values and lease incentives and the accretion of below-market lease values and other deferred revenue. (2) Variable lease payments include participation rents, which are generally based on a percentage of the gross crop revenues earned on the farm, and reimbursements of certain property operating expenses by tenants. Participation rents are generally recognized when all contingencies have been resolved and when actual results become known or estimable, enabling us to estimate and/or measure our share of such gross revenues. During the years ended December 31, 2024, 2023, and 2022, we recorded participation rents of approximately $ 9.4 million, $ 5.9 million, and $ 7.7 million, respectively; reimbursements of certain property operating expenses by tenants of approximately $ 1.4 million, $ 688,000 , and $ 110,000 , respectively; and late fees of approximately $ 20,000 , $ 46,000 , and $ 0 , respectively. (3) Reflected as a line item on our accompanying Consolidated Statements of Operations and Comprehensive Income. NOTE 10. EARNINGS PER SHARE OF COMMON STOCK The following table sets forth the computation of basic and diluted earnings per common share for the years ended December 31, 2024, 2023, and 2022, computed using the weighted-average number of common shares outstanding during the respective periods. Earnings figures are presented net of non-controlling interests in the earnings per share calculations. The non-controlling limited partners’ outstanding OP Units (which may be redeemed for shares of common stock) have been excluded from the diluted per-share calculation, as there would be no effect on the amounts since the non-controlling OP Unitholders’ share of earnings would also be added back to net income or loss. (Dollars in thousands, except per-share amounts): For the Years Ended December 31, 2024 2023 2022 Net loss attributable to common stockholders $ ( 10,455 ) $ ( 9,852 ) $ ( 15,010 ) Weighted average shares of common stock outstanding – basic and diluted 35,909,956 35,733,742 34,563,460 Loss per common share – basic and diluted $ ( 0.29 ) $ ( 0.28 ) $ ( 0.43 ) The weighted-average number of OP Units held by non-controlling OP Unitholders was 0 , 0 , and 61,714 for the years ended December 31, 2024, 2023, and 2022, respectively. NOTE 11. SUBSEQUENT EVENTS Portfolio Activity—Property Sales In January 2025, we completed the sale of five farms in Florida totaling 5,630 gross acres for an aggregate sales price of approximately $ 52.5 million. Including closing costs, we recognized a net gain on the sale of approximately $ 14.2 million. In February 2025, we completed the sale of two farms in Nebraska totaling 2,559 gross acres for an aggregate sales price of $ 12.0 million. Including closing costs, we recognized an aggregate net gain on these sales of approximately $ 1.6 million. Financing Activity Debt Activity—Loan Repayments Subsequent to December 31, 2024, we repaid approximately $ 19.4 million of loans. On a weighted-average basis, these borrowings bore interest at a fixed, stated rate of 5.38 % and an effective interest rate (after interest patronage, where applicable) of 4.62 %. Distributions On January 14, 2025, our Board of Directors declared the following monthly cash distributions to holders of our preferred and common stock: 95 Table of Content Issuance Record Date Payment Date Distribution per Share Series B Preferred Stock: January 24, 2025 January 31, 2025 $ 0.125 February 19, 2025 February 28, 2025 0.125 March 19, 2025 March 31, 2025 0.125 Total Series B Preferred Stock Distributions: $ 0.375 Series C Preferred Stock: January 24, 2025 January 31, 2025 $ 0.125 February 19, 2025 February 28, 2025 0.125 March 19, 2025 March 31, 2025 0.125 Total Series C Preferred Stock Distributions: $ 0.375 Series D Term Preferred Stock: January 24, 2025 January 31, 2025 $ 0.104167 February 19, 2025 February 28, 2025 0.104167 March 19, 2025 March 31, 2025 0.104167 Total Series D Term Preferred Stock Distributions: $ 0.312501 Series E Preferred Stock: January 27, 2025 February 5, 2025 $ 0.104167 February 25, 2025 March 5, 2025 0.104167 March 26, 2025 April 4, 2025 0.104167 Total Series E Preferred Stock Distributions: $ 0.312501 Common Stock (1) : January 24, 2025 January 31, 2025 $ 0.0467 February 19, 2025 February 28, 2025 0.0467 March 19, 2025 March 31, 2025 0.0467 Total Common Stock Distributions: $ 0.1401 (1) The same amounts paid to common stockholders will be paid as distributions on each OP Unit held by non-controlling OP Unitholders, if any, as of the above record dates. 96 Table of Content GLADSTONE LAND CORPORATION SCHEDULE III—REAL ESTATE AND ACCUMULATED DEPRECIATION December 31, 2024 (In Thousands) Initial Cost Subsequent Capitalized Additions Total Cost Location and Description of Property Date Acquired Encumbrances Land and Land Improvements Buildings & Improvements Permanent Plantings Land Improvements Buildings & Improvements Permanent Plantings Land and Land Improvements Buildings & Improvements Permanent Plantings Total (1) Accumulated Depreciation (2) Santa Cruz County, California: Land & Improvements 6/16/1997 $ 7,010 $ 4,350 $ — $ — $ — $ 622 $ — $ 4,350 $ 622 $ — $ 4,972 $ ( 449 ) Ventura County, California: Land, Buildings & Improvements 9/15/1998 27,317 9,895 5,256 — — 378 — 9,895 5,634 — 15,529 ( 5,209 ) Santa Cruz County, California: Land & Improvements 1/3/2011 6,113 8,328 — — 453 545 — 8,781 545 — 9,326 ( 289 ) Hillsborough County, Florida: Land, Buildings & Improvements 9/12/2012 — 2,199 1,657 — 14 1,796 — 2,213 3,453 — 5,666 ( 1,989 ) Monterey County, California: Land, Buildings & Improvements 10/21/2013 4,381 7,187 164 — 180 3,064 — 7,367 3,228 — 10,595 ( 1,271 ) Cochise County, Arizona: Land, Buildings & Improvements 12/27/2013 1,387 6,168 572 — 8 5,738 — 6,176 6,310 — 12,486 ( 2,393 ) Santa Cruz County, California: Land, Building & Improvements 6/13/2014 1,344 5,576 207 — — 27 — 5,576 234 — 5,810 ( 211 ) Ventura County, California: Land, Buildings & Improvements 7/23/2014 978 6,219 505 — — 85 — 6,219 590 — 6,809 ( 377 ) Kern County, California: Land & Improvements 7/25/2014 1,150 5,841 67 — — 974 — 5,841 1,041 — 6,882 ( 619 ) Manatee County, Florida: Land, Buildings & Improvements 9/29/2014 — 8,466 5,426 — — 3,734 — 8,466 9,160 — 17,626 ( 4,671 ) Ventura County, California: Land, Buildings & Improvements 10/29/2014 13,916 23,673 350 — — 2,318 — 23,673 2,668 — 26,341 ( 1,235 ) Ventura County, California: Land & Improvements 11/4/2014 — 5,860 92 — — 2 — 5,860 94 — 5,954 ( 94 ) Monterey County, California: Land, Buildings & Improvements 1/5/2015 10,673 15,852 582 — ( 156 ) 1,518 — 15,696 2,100 — 17,796 ( 1,151 ) Manatee County, Florida: Land, Buildings & Improvements 3/10/2015 — 2,403 1,871 — — 369 — 2,403 2,240 — 4,643 ( 1,694 ) Hendry County, Florida: Land, Buildings & Improvements 6/25/2015 10,356 14,411 789 — — — — 14,411 789 — 15,200 ( 695 ) Rock County, Nebraska: Land, Buildings & Improvements 8/20/2015 — 4,862 613 — — 32 — 4,862 645 — 5,507 ( 534 ) Holt County, Nebraska: Land, Buildings & Improvements 8/20/2015 — 4,690 786 — — 76 — 4,690 862 — 5,552 ( 565 ) Kern County, California: Land & Improvements 9/3/2015 14,432 18,893 497 — 688 6,587 1,418 19,581 7,084 1,418 28,083 ( 3,721 ) Cochise County, Arizona: Land, Buildings & Improvements 12/23/2015 — 4,234 1,502 — 142 3,809 — 4,376 5,311 — 9,687 ( 1,973 ) Saguache County, Colorado: Land, Buildings & Improvements 3/3/2016 528 16,756 8,348 — — 1,486 — 16,756 9,834 — 26,590 ( 6,862 ) Fresno County, California: Land, Improvements & Permanent plantings 4/5/2016 6,920 3,623 1,228 11,455 — 2,623 ( 25 ) 3,623 3,851 11,430 18,904 ( 4,742 ) Saint Lucie County, Florida: Land, Buildings & Improvements 7/1/2016 — 4,165 971 — — — — 4,165 971 — 5,136 ( 825 ) Baca County, Colorado: Land & Buildings 9/1/2016 3,093 6,167 214 — — — — 6,167 214 — 6,381 ( 119 ) Merced County, Colorado: Land & Improvements 9/14/2016 6,804 12,845 504 — — 190 — 12,845 694 — 13,539 ( 334 ) Stanislaus County, Colorado: Land & Improvements 9/14/2016 7,371 14,114 45 — 59 463 — 14,173 508 — 14,681 ( 260 ) Fresno County, California: Land, Improvements & Permanent plantings 10/13/2016 3,035 2,937 139 3,452 — 9 — 2,937 148 3,452 6,537 ( 1,499 ) Baca County, Colorado: Land & Improvements 12/28/2016 5,979 11,430 278 — — — — 11,430 278 — 11,708 ( 278 ) Yuma County, Arizona Land & Improvements 6/1/2017 10,551 12,390 12,191 — 151 16,810 — 12,541 29,001 — 41,542 ( 9,562 ) Fresno County, California: Land, Improvements & Permanent plantings 7/17/2017 — 5,048 777 7,818 3,249 2,522 ( 1,124 ) 8,297 3,299 6,694 18,290 ( 2,649 ) 97 Table of Content Santa Barbara County, California: Land, Improvements & Permanent plantings 8/9/2017 — 4,559 577 397 ( 50 ) 1,199 ( 121 ) 4,509 1,776 276 6,561 ( 606 ) Okeechobee County, Florida: Land & Improvements 8/9/2017 4,318 9,111 953 — 985 1,378 — 10,096 2,331 — 12,427 ( 1,213 ) Walla Walla County, Washington: Land, Improvements & Permanent plantings 9/8/2017 — 5,286 401 3,739 ( 23 ) — ( 3,739 ) 5,263 401 — 5,664 ( 313 ) Baca County, Colorado Land & Improvements 10/2/2017 — 924 — — — — — 924 — — 924 — Fresno County, California: Land, Improvements & Permanent plantings 12/15/2017 2,661 2,016 324 3,626 ( 1 ) 23 ( 3 ) 2,015 347 3,623 5,985 ( 2,527 ) Kern County, California: Land & Improvements 1/31/2018 1,867 2,733 249 — ( 4 ) 1,529 — 2,729 1,778 — 4,507 ( 531 ) Collier & Hendry, Florida Land & Improvements 7/12/2018 19,376 36,223 344 — 1 — — 36,224 344 — 36,568 ( 310 ) Kings County, California: Land, Improvements & Permanent plantings 9/13/2018 3,856 3,264 284 3,349 5 — 5 3,269 284 3,354 6,907 ( 930 ) Madera, California: Land, Improvements & Permanent plantings 11/1/2018 12,095 12,305 1,718 9,015 13 704 ( 563 ) 12,318 2,422 8,452 23,192 ( 1,964 ) Hartley County, Texas: Land & Improvements 11/20/2018 — 7,320 1,054 — 3 96 — 7,323 1,150 — 8,473 ( 447 ) Merced County, California: Land 12/6/2018 4,217 8,210 — — 5 — — 8,215 — — 8,215 — Madera County, California: Land & Improvements 4/9/2019 14,732 8,074 2,696 17,916 — 1,611 — 8,074 4,307 17,916 30,297 ( 5,579 ) Allegran and Van Buren County, Michigan: Land & Improvements 6/4/2019 — 1,634 800 2,694 ( 1,085 ) ( 366 ) ( 1,656 ) 549 434 1,038 2,021 ( 598 ) Yolo County, California: Land & Improvements 6/13/2019 4,411 5,939 665 2,648 — — — 5,939 665 2,648 9,252 ( 764 ) Monterey County, California: Land & Improvements 7/11/2019 4,698 8,629 254 — 2,220 1,956 — 10,849 2,210 — 13,059 ( 425 ) Martin County, Florida: Land & Improvements 7/22/2019 33,947 51,691 6,595 — ( 2,629 ) 1 — 49,062 6,596 — 55,658 ( 2,748 ) Fresno County, California: Land & Improvements 8/16/2019 36,079 24,772 13,410 31,420 ( 3 ) 1,413 10 24,769 14,823 31,430 71,022 ( 9,644 ) Ventura County, California: Land & Improvements 8/28/2019 11,051 20,602 397 — 306 1,760 — 20,908 2,157 — 23,065 ( 680 ) Napa County, California: Land & Improvements 8/29/2019 15,716 27,509 1,646 2,923 3,235 1,263 894 30,744 2,909 3,817 37,470 ( 1,821 ) Hayes County, Nebraska: Land & Improvements 10/7/2019 2,768 4,750 264 — 16 1 — 4,766 265 — 5,031 ( 231 ) Hayes & Hitchcock County, Nebraska: Land & Improvements 10/7/2019 5,217 9,275 431 — 20 1 — 9,295 432 — 9,727 ( 400 ) Phillips County, Colorado: Land & Improvements 1/15/2020 4,249 6,875 660 — — 7 — 6,875 667 — 7,542 ( 330 ) Kern County, California: Land, Improvements & Permanent plantings 6/24/2020 7,611 12,521 1,325 370 — 264 — 12,521 1,589 370 14,480 ( 411 ) Wicomico & Caroline County, Maryland, and Sussex County, Delaware: Land & Improvements 8/31/2020 4,026 6,703 626 — — 480 — 6,703 1,106 — 7,809 ( 349 ) Fresno County, California: Land & Improvements 9/3/2020 16,723 15,071 4,680 11,921 305 635 — 15,376 5,315 11,921 32,612 ( 3,477 ) Fresno County, California: Land, Improvements & Permanent plantings 10/1/2020 16,765 7,128 9,206 15,242 8 920 16 7,136 10,126 15,258 32,520 ( 4,600 ) Ventura County, California: Land & Improvements 12/15/2020 12,450 19,215 1,264 — 48 23 — 19,263 1,287 — 20,550 ( 458 ) Tulare County, California: Land, Improvements & Permanent plantings 12/17/2020 10,207 26,952 6,420 28,152 36 19 37 26,988 6,439 28,189 61,616 ( 10,564 ) Whatcom County, Washington: Land, Improvements, & Permanent plantings 12/24/2020 15,196 8,219 7,228 16,281 18 193 35 8,237 7,421 16,316 31,974 ( 5,519 ) San Joaquin County, California: Land, Improvements, & Permanent plantings 12/24/2020 20,021 12,265 2,142 19,924 6 ( 996 ) 10 12,271 1,146 19,934 33,351 ( 8,123 ) San Joaquin County, California: Land, Improvements, & Permanent plantings 3/11/2021 — — 4,306 — — — — — 4,306 — 4,306 ( 1,178 ) Tehama County, California Land & Improvements & Horticulture 4/5/2021 21,355 27,747 2,512 6,600 103 34 — 27,850 2,546 6,600 36,996 ( 2,738 ) Kern County, California Land & Improvements & Horticulture 6/4/2021 9,460 21,810 2,514 25,984 65 673 — 21,875 3,187 25,984 51,046 ( 9,268 ) 98 Table of Content Van Buren County, Michigan: Land & Improvements & Horticulture 6/9/2021 7,403 3,677 4,391 5,233 14 44 70 3,691 4,435 5,303 13,429 ( 1,334 ) Kern County, California Land & Improvements & Horticulture 8/11/2021 13,416 5,690 8,156 16,154 11 46 — 5,701 8,202 16,154 30,057 ( 5,431 ) Yamhill County, Oregon Land & Improvements & Horticulture 8/11/2021 6,037 2,854 2,493 6,972 8 28 — 2,862 2,521 6,972 12,355 ( 1,993 ) St. Lucie County, Florida Land & Improvements & Horticulture 8/18/2021 2,982 2,494 601 2,146 99 135 140 2,593 736 2,286 5,615 ( 858 ) Kern County, California Land & Improvements & Horticulture 12/3/2021 14,604 22,363 2,894 62,744 23 67 — 22,386 2,961 62,744 88,091 ( 8,123 ) Charlotte County, FL Land & Improvements & Horticulture 12/16/2021 4,495 7,275 75 — 1,937 1,395 — 9,212 1,470 — 10,682 ( 75 ) Glenn, California Land & Improvements 6/16/2022 — 16,184 1,298 5,933 34 603 — 16,218 1,901 5,933 24,052 ( 1,905 ) Franklin & Grant, Washington Land & Improvements & Horticulture 7/21/2022 — 11,437 1,607 15,798 50 327 555 11,487 1,934 16,353 29,774 ( 6,314 ) Umatilla, Oregon Land & Improvements & Horticulture 7/21/2022 — 344 564 2,858 14 135 1,167 358 699 4,025 5,082 ( 379 ) Miscellaneous Investments Various 22,562 39,205 10,403 9,175 ( 1,100 ) 6,145 696 38,105 16,548 9,871 64,524 ( 7,762 ) $ 529,909 $ 779,437 $ 154,058 $ 351,939 $ 9,481 $ 79,523 $ ( 2,178 ) $ 788,918 $ 233,581 $ 349,761 $ 1,372,260 $ ( 169,190 ) (1) The aggregate cost for land, buildings, improvements, and permanent plantings for federal income tax purposes is approximately $ 1.5 billion. (2) The Company computes depreciation using the straight-line method over the shorter of the estimated useful life or 50 for buildings, improvements, and permanent plantings, and the shorter of the estimated useful life or 5 to 20 years for equipment and fixtures. The following table reconciles the change in the balance of real estate during the years ended December 31, 2024 and 2023, respectively (dollars in thousands): 2024 2023 Balance, beginning of period $ 1,437,812 $ 1,432,394 Additions: Acquisitions during the period — — Improvements 5,607 10,578 Deductions: Dispositions during period ( 69,053 ) ( 5,160 ) Impairments during period ( 2,106 ) — Balance, end of period (1) $ 1,372,260 $ 1,437,812 (1) Includes approximately $ 47.6 million and $ 54.1 million of real estate held for sale, at cost, as of December 31, 2024 and 2023, respectively. The following table reconciles the change in the balance of accumulated depreciation during the years ended December 31, 2024 and 2023, respectively (dollars in thousands): 2024 2023 Balance, beginning of period $ 142,657 $ 106,966 Additions during period 33,894 36,050 Dispositions during period ( 7,361 ) ( 359 ) Balance, end of period (1) $ 169,190 $ 142,657 (1) Includes approximately $ 1.4 million and $ 445,000 of accumulated depreciation related to real estate held for sale as of December 31, 2024 and 2023, respectively. 99 Table of Content ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE None.