What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2021-02-24 compared with 2020-02-19 · 690 added, 570 removed, 751 unchanged (63% of the section changed)

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Based on our assessment, management concluded that our internal control over financial reporting was effective as of December 31, 2020.

The effectiveness of our internal control over financial reporting as of December 31, 2019 , has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which is included herein.

February 24, 2021

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To the Stockholders and Board of Directors of Gladstone Land Corporation

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Gladstone Land Corporation and its subsidiaries (the “Company”) as of December 31, 2019 and 2018, and the related consolidated statements of operations and comprehensive income, equity and cash flows for each of the two years in the period ended December 31, 2019 , including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”).

We also have audited the Company's internal control over financial reporting as of December 31, 2019 , based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2019 and 2018 , and the results of its operations and its cash flows for each of the two years in the period ended December 31, 2019 in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2019 , based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Report of Management on Internal Controls over Financial Reporting.

Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits.

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, 2020 and 2019, and the related consolidated statements of operations and comprehensive income, of equity and of cash flows for the years then ended, 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, 2020 and 2019 , and the results of its operations and its cash flows for the years then ended 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 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, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements 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.

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 audit 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 audit 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.

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk.

Our audits also included performing such other procedures as we considered necessary in the circumstances.

We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process 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.

A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

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.

Purchase Price Allocations for Real Estate Acquisitions – Land Valued Using a Sales Comparison Approach

As described in Notes 2 and 3 to the consolidated financial statements, during 2020 the Company completed 13 real estate acquisitions consisting of 26 farms for a total purchase price of $256 million, which consisted of $125 million of land.

Management allocates the purchase price of real estate to (i) the tangible assets acquired and liabilities assumed (typically consisting of land, buildings, improvements, horticulture, 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 relative fair values.

Management’s estimates of fair value are made using methods such as a sales comparison approach, a cost approach, and either an income capitalization approach or discounted cash flow analysis.

The principal considerations for our determination that performing procedures relating to the purchase price allocations for real estate acquisitions – land valued using a sales comparison approach is a critical audit matter are the significant judgment by management when developing the estimated fair value of the land, which in turn led to significant auditor judgment, subjectivity and effort in performing procedures and evaluating audit evidence relating to the comparable sales used in the sales comparison approach used to value the land.

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) reading the purchase agreements;

(ii) testing management’s process for developing the estimated fair value of the land;

(iii) testing the completeness and accuracy of data used by management in estimating the fair value of the land;

(iv) evaluating the appropriateness of the sales comparison approach;

and (v) evaluating the reasonableness of the comparable sales used in the sales comparison approach.

Evaluating the reasonableness of the comparable sales involved evaluating whether the comparable sales used by management were reasonable considering the consistency with (i) external market and industry data, (ii) previous real estate acquisitions, and (iii) evidence obtained in other areas of the audit.

/s/ PricewaterhouseCoopers LLP

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(In thousands, except share and per-share data)

December 31, 2019

December 31, 2018

December 31, 2020 December 31, 2019

Investments in real estate, net $ 1,046,203 $ 792,081

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Other assets, net 8,136 6,191

TOTAL ASSETS $ 1,067,289 $ 816,787

LIABILITIES AND EQUITY

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2,000,000 shares authorized, 1,150,000 shares issued and outstanding as of December 31, 2020 and 2019, net

28,594 28,359

Accounts payable and accrued expenses 9,081 10,132

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6,456,065 shares authorized, 5,956,065 shares issued and outstanding as of December 31, 2020;

1,144,393 shares issued and outstanding as of December 31, 2018

6,485,400 shares authorized, 4,755,869 shares issued and outstanding as of December 31, 2019

Series C cumulative redeemable preferred stock, $ 0.001 par value, $ 25.00 per share liquidation preference;

25,999,862 shares authorized, 1,088,435 shares issued and outstanding as of December 31, 2020;

no shares authorized, issued, or outstanding as of December 31, 2019

Common stock, $ 0.001 par value;

65,544,073 shares authorized, 26,219,019 shares issued and outstanding as of December 31, 2020;

17,891,340 shares issued and outstanding as of December 31, 2018

91,514,600 shares authorized, 20,936,658 shares issued and outstanding as of December 31, 2019

Additional paid-in capital 440,470 315,770

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Non-controlling interests in Operating Partnership — 2,349

Total equity 383,790 278,970

TOTAL LIABILITIES AND EQUITY $ 1,067,289 $ 816,787

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Lease revenue, net $ 57,031 $ 40,692

Other operating revenue

Total operating revenues 57,031 40,692

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Incentive fee 3,038 847

Capital gains fee

Administration fee 1,448 1,207

General and administrative expenses 2,102 1,989

Other operating expenses

Total operating expenses 29,380 22,929

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OTHER INCOME (EXPENSE):

Other income 1,872 938

Interest expense ( 20,621 ) ( 16,331 )

Dividends declared on Series A cumulative term preferred stock ( 1,833 ) ( 1,833 )

(Loss) gain on dispositions of real estate assets, net

Property and casualty recovery (loss), net

Loss on write-down of crop inventory

Loss on dispositions of real estate assets, net ( 2,180 ) ( 328 )

Property and casualty recovery, net 70 10

Loss from investments in unconsolidated entities ( 4 ) —

Total other expense, net ( 22,696 ) ( 17,544 )

NET INCOME 4,955 1,762

Net income attributable to non-controlling interests ( 29 ) ( 21 )

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Dividends declared on Series B cumulative redeemable preferred stock ( 8,837 ) ( 4,240 )

NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS

(LOSS) EARNINGS PER COMMON SHARE:

Other charges related to redemptions of Series B cumulative redeemable preferred stock ( 44 ) —

Dividends declared on Series C cumulative redeemable preferred stock ( 441 ) —

NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS $ ( 4,396 ) $ ( 2,499 )

LOSS PER COMMON SHARE:

Basic and diluted $ ( 0.20 ) $ ( 0.13 )

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(In thousands, except share data)

Series B Preferred Stock

Accumulated Comprehensive Income

Distributions

Preferred Stock Series C

Preferred Stock Common Stock Additional

Capital Accumulated

Comprehensive Loss Distributions

Earnings Total

Stockholders’

Interest Total

of Shares Par

Balance at December 31, 2018 1,144,393 $ 1 — $ — 17,891,340 $ 18 $ 202,053 $ — $ ( 25,826 ) $ 176,246 $ 4,807 $ 181,053

Issuance of Series B Preferred Stock, net

3,626,076 4 — — — — 80,738 — — 80,742 — 80,742

Redemptions of Series B Preferred Stock

( 14,600 ) — — — — — ( 340 ) — — ( 340 ) — ( 340 )

Issuance of OP Units as consideration in real estate acquisitions, net

— — — — — — — — — — 3,275 3,275

Redemptions of OP Units

— — — — 570,879 1 4,714 — — 4,715 ( 4,715 ) —

Issuance of common stock, net

— — — — 2,474,439 2 27,695 — — 27,697 — 27,697

Net income — — — — — — — — 1,741 1,741 21 1,762

Dividends—Series B Preferred Stock — — — — — — — — ( 4,240 ) ( 4,240 ) — ( 4,240 )

Distributions—OP units and common stock — — — — — — — — ( 10,460 ) ( 10,460 ) ( 129 ) ( 10,589 )

Comprehensive loss attributable to the Company

— — — — — — — ( 390 ) — ( 390 ) — ( 390 )

Adjustment to non-controlling interests resulting from changes in ownership of the Operating Partnership

— — — — — — 910 — — 910 ( 910 ) —

Balance at December 31, 2019 4,755,869 $ 5 — $ — 20,936,658 $ 21 $ 315,770 $ ( 390 ) $ ( 38,785 ) $ 276,621 $ 2,349 $ 278,970

Issuance of Series B Preferred Stock, net

1,229,531 1 — — — — 27,049 — — 27,050 — 27,050

Redemptions of Series B Preferred Stock

Issuance of OP Units as consideration in real estate acquisitions, net

( 29,335 ) — — — — — ( 637 ) — ( 44 ) ( 681 ) — ( 681 )

Issuance of Series C Preferred Stock, net — — 1,088,573 1 — — 24,715 — — 24,716 — 24,716

Redemptions of Series C Preferred Stock — — ( 138 ) — — — ( 3 ) — — ( 3 ) — ( 3 )

Redemptions of OP Units — — — — 288,304 — 4,383 — — 4,383 ( 4,383 ) —

Issuance of common stock, net — — — — 4,994,057 5 71,267 — — 71,272 — 71,272

Accumulated Other Comprehensive Income

Dividends—Series B Preferred Stock

Distributions—common stock and OP Units

Net income — — — — — — — — 4,926 4,926 29 4,955

Dividends—Series B Preferred Stock and Series C Preferred Stock

— — — — — — — — ( 9,278 ) ( 9,278 ) — ( 9,278 )

Distributions—OP Units and common stock

— — — — — — — — ( 12,032 ) ( 12,032 ) ( 69 ) ( 12,101 )

Comprehensive loss attributable to the Company

— — — — — — — ( 1,110 ) — ( 1,110 ) — ( 1,110 )

Adjustment to non-controlling interests resulting from changes in ownership of the Operating Partnership

— — — — — — ( 2,074 ) — — ( 2,074 ) 2,074 —

Balance at December 31, 2020 5,956,065 $ 6 1,088,435 $ 1 26,219,019 $ 26 $ 440,470 $ ( 1,500 ) $ ( 55,213 ) $ 383,790 $ — $ 383,790

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CASH FLOWS FROM OPERATING ACTIVITIES:

Net income $ 4,955 $ 1,762

Adjustments to reconcile net income to net cash provided by operating activities:

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Amortization of deferred rent assets and liabilities, net ( 215 ) ( 336 )

Loss from investments in unconsolidated entities 4 —

Bad debt expense 17 13

Loss (gain) on dispositions of real estate assets, net

Property and casualty (recovery) loss

Loss on write-down of inventory

Loss on dispositions of real estate assets, net 2,180 328

Property and casualty recovery, net ( 70 ) ( 10 )

Changes in operating assets and liabilities:

Crop inventory and Other assets, net

Other assets, net ( 1,737 ) ( 896 )

Accounts payable and accrued expenses and Due to related parties, net ( 744 ) 1,869

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Proceeds from dispositions of real estate assets 342 —

Maturity of short-term investment

Insurance proceeds received capitalized as real estate additions 68 84

Change in deposits on real estate acquisitions and investments, net

Deposits on prospective real estate acquisitions and investments ( 280 ) 150

Net cash used in investing activities ( 272,901 ) ( 262,650 )

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Offering costs ( 6,620 ) ( 9,186 )

Payments for redemptions of OP Units

Payments for redemptions of Series B Preferred Stock

Redemption of cumulative redeemable preferred stock (Series B and Series C) ( 684 ) ( 340 )

Borrowings from notes and bonds payable 156,053 155,659

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Repayments of lines of credit ( 22,300 ) ( 45,600 )

Payment of financing fees

Dividends paid on Series B cumulative redeemable preferred stock

Payments of financing fees ( 1,172 ) ( 1,181 )

Dividends paid on cumulative redeemable preferred stock (Series B and Series C) ( 8,982 ) ( 3,646 )

Distributions paid on common stock ( 12,033 ) ( 10,460 )

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Net cash provided by financing activities 243,429 240,238

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS

NET DECREASE IN CASH AND CASH EQUIVALENTS ( 4,470 ) ( 1,042 )

CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 13,688 14,730

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Interest paid (1)

$ 22,501 $ 15,974

NON-CASH OPERATING, INVESTING, AND FINANCING INFORMATION:

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Unrealized loss related to interest rate hedging instrument ( 1,500 ) ( 390 )

Dividends paid on Series C Preferred Stock via additional share issuances 6 —

(1) Includes distribution made on our Series A Term Preferred stock

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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 December 31, 2019 and 2018 , the Company owned approximately 98.6% and 96.9% , respectively, of the outstanding OP Units (see Note 8, “ Equity ,” for additional discussion regarding OP Units).

As of December 31, 2020 and 2019, the Company owned 100.0 % and approximately 98.6 %, respectively, 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.

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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.

Actual results could materially differ from those estimates.

We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, including the impact of extraordinary events, such as the novel coronavirus (“COVID-19”) pandemic, the results of which form the basis for making certain judgments.

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 drain systems and buildings), and long-lived horticulture acquired in connection with certain land purchases (consisting primarily of almond and pistachio trees, blueberry bushes, and wine vineyards).

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 straight-line method over the shorter of the estimated useful life or 39 years for buildings and improvements, the shorter of the estimated useful life or 40 years for horticulture, 5 to 10 years for equipment and fixtures, and the shorter of the useful life or the remaining lease term for tenant improvements.

Certain of our acquisitions involve sale-leaseback transactions with newly-originated leases, and other of our acquisitions involve the acquisition of farmland that is already being operated as rental property, in which case we will typically assume the lease in place at the time of acquisition.

Prior to us early adopting Accounting Standards Update (“ASU”) 2017-01, “Clarifying the Definition of a Business” (as further described in Note 3, “ Real Estate and Intangible Assets—Acquisitions ”), acquisitions of farmland already being operated as rental property were generally considered to be business combinations under Accounting Standards Codification (“ASC”) 805, “Business Combinations.” However, after our adoption of ASU 2017-01, effective October 1, 2016, we now generally consider both types of acquisitions to be asset acquisitions under ASC 360, “Property Plant and Equipment.”

Regardless of whether an acquisition is considered an asset acquisition or a business combination, both ASC 360 and ASC 805 require that the purchase price of real estate be allocated to (i) the tangible assets acquired and liabilities assumed, typically consisting of land, buildings, improvements, horticulture, and long-term debt, and, if applicable, (ii) any identifiable intangible assets and liabilities, which may consist of the values of above- and below-market leases, in-place lease values, lease origination costs, and tenant relationships, based in each case on their fair values.

In addition, ASC 360 requires us to capitalize the transaction costs incurred in connection with the acquisition, whereas ASC 805 required that all costs related to the acquisition be expensed as incurred, rather than capitalized into the cost of the acquisition.

We generally compute depreciation using the straight-line method over the shorter of the estimated useful life or 39 years for buildings and improvements, the shorter of the estimated useful life or 40 years for permanent plantings, 5 to 10 years for equipment and fixtures, and the shorter of the useful life or the remaining lease term for tenant improvements.

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”) 360, “Property Plant and Equipment.”

Regardless of whether an acquisition is considered an asset acquisition under ASC 360 or a business combination under ASC 805, “Business Combinations,” both ASC 360 and ASC 805 require 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, for acquisitions accounted for as asset acquisitions under ASC 360, 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.

ASC 805 required that all costs related to the acquisition be expensed as incurred, rather than capitalized into the cost of the acquisition.

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.

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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 horticulture, based on management’s determination of the relative fair values of such assets and liabilities as of the date of acquisition.

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.

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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.

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.

Unless otherwise noted, all properties acquired during 2020 and 2019 were accounted for as asset acquisitions under ASC 360.

Impairment of Real Estate Assets

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(iv) the expected useful life of the improvements relative to the remaining length of the lease;

(v) whether the tenant improvements are expected to

have significant residual value at the end of the lease term;

(v) whether the tenant improvements are expected to have significant residual value at the end of the lease term;

and (vi) whether the tenant or the Company constructs or directs construction of the improvements.

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Our cash and cash equivalents as of December 31, 2020 and 2019 were held in the custody of one financial institution, and our balance at times may exceed federally-insurable limits.

We did not have any restricted cash or restricted cash equivalents as of December 31, 2019 or 2018 .

Crop Inventory and Crop Sales

Crop Inventory

From October 17, 2017, through July 31, 2018, Land Advisers operated a 169 -acre farm located in Ventura County, California, under a short-term lease (see Note 6, “ Related-Party Transactions—TRS Lease Assumption ” for further discussion on this lease assignment).

Costs incurred by Land Advisers in operating the farm generally consisted of growing costs (including the costs of land preparation, plants, fertilizers and pesticides, and labor costs), harvesting and selling costs (including labor costs for harvesting, packaging and cooling costs, and sales commissions), and certain overhead costs (including management/oversight costs).

Due to certain market conditions during the year ended December 31, 2018 (primarily the existence of bumper crops in all of the strawberry-growing regions within California), we were unable to sell all of the crops and therefore assessed the market value of such unsold crops to be zero .

Accordingly, we wrote down the cost of crop inventory to its estimated net realizable value of zero and recorded a loss during the year ended December 31, 2018 , of approximately $1.1 million , included within Loss on write-down of crop inventory on the accompanying Consolidated Statement of Operations and Comprehensive Income.

Revenue from the sale of harvested crops was recognized when the harvested crops had been delivered to the facility and title had transferred and were recorded using the market price on the date of delivery.

Accumulated costs were charged to cost of products sold (based on percentage of gross revenue from sales) as the related crops were harvested and sold.

Revenue from the sale of harvested crops and accumulated costs allocated to the crops sold for the year ended December 31, 2018 , are shown in the following table (dollars in thousands, except for footnotes):

Sales revenue (1)

Cost of sales (2)

Included within Other operating revenue on the accompanying Consolidated Statements of Operations and Comprehensive Income.

Included within Other operating expenses on the accompanying Consolidated Statements of Operations and Comprehensive Income.

Excludes rent expense owed to the Company and interest expense owed on a loan from the Company to Land Advisers, both of which expenses were eliminated in consolidation.

Also excludes the allocation of a fee earned by our Adviser from Land Advisers of approximately $176,000 during the year ended December 31, 2018 , which is included within Base management fee on the accompanying Consolidated Statements of Operations and Comprehensive Income (see Note 6, “ Related-Party Transactions—TRS Fee Arrangements—TRS Expense Sharing Agreement ” for further discussion on this fee).

The lease to Land Advisers expired on July 31, 2018, after which we leased the farm to a new, unrelated third-party tenant under a 10 -year lease that commenced on August 1, 2018.

We did no t have any restricted cash or restricted cash equivalents as of December 31, 2020 or 2019.

Debt Issuance Costs

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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.

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,” 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 is amortized over the term of the new arrangement.

In accordance with ASU 2015-15, unamortized debt issuance costs associated with our lines of credit are reported as an asset and are included in Other assets, net on the accompanying Consolidated Balance Sheets.

In accordance with ASU 2015-03,

unamortized debt issuance costs related to long-term borrowings are reported as a deduction from the carrying amount of the related debt liability and are included in Notes and bonds payable, net on the accompanying Consolidated Balance Sheets.

In both cases, the amortization of debt issuance costs is included as a component of interest expense on the accompanying Consolidated Statements of Operations.

During the years ended December 31, 2020 and 2019, we recorded approximately $ 756 ,000 and $ 630 ,000, respectively, of total amortization expense related to debt issuance costs.

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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 as General and administrative expenses on the accompanying Consolidated Statements of Operations and Comprehensive Income.

During the year ended December 31, 2020, we incurred approximately $ 113,000 of costs for an offering that was subsequently aborted and charged such costs to General and administrative expenses 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 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, and other miscellaneous receivables.

As of December 31, 2019 , the balance in Other assets, net also consists of approximately $1.7 million for the cost of five industrial generators used to provide power for newly-drilled wells on certain of our farms until such wells were connected to a permanent power source, as well as approximately $587,000 attributable to an ownership interest in an LLC acquired in connection with a property acquisition during the year ended December 31, 2019 (see “ —Investments in Unconsolidated Entities ” below and also Note 3, “ Real Estate and Lease Intangibles—Acquisitions—2019 Acquisitions ” for further discussion on the LLC ownership interest acquired).

As of December 31, 2020 and 2019, the balance in Other assets, net also consists of approximately $ 1.4 million and $ 1.6 million, respectively, for the net depreciated cost of five industrial generators used to provide power for newly-drilled wells on certain of our farms until such wells were connected to a permanent power source, as well as a net ownership interest in an LLC valued at approximately $ 1.2 million and $ 587,000 , respectively, which interest was acquired in connection with certain property acquisitions during the years ended December 31, 2020 and 2019 (see “ —Investments in Unconsolidated Entities ” below and also Note 3, “ Real Estate and Lease Intangibles—Acquisitions ” for further discussion on the LLC ownership interests acquired).

Other liabilities, net generally consists primarily of rents received in advance, net deferred rent liabilities, and operating lease liabilities.

As of December 31, 2019 , the balance in Other liabilities, net also consists of a net liability of approximately $390,000 related to changes in fair value of various interest rate swap agreements we are party to.

As of December 31, 2020 and 2019, the balance in Other liabilities, net also consists of a net liability of approximately $ 1.5 million and $ 390,000 , respectively, related to changes in fair values of various interest rate swap agreements we are party to.

Investments in Unconsolidated Entities

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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.

As of December 31, 2019 , we concluded that we had one investment in a VIE, and because we are not the primary beneficiary, we did not consolidate the entity.

As of each of December 31, 2020 and 2019, we concluded that we had one investment in a VIE, and because we are not the primary beneficiary, we did not consolidate the entity.

However, as our investment in the VIE is deemed to constitute “significant influence,” we have accounted for this investment in a VIE under the equity method of accounting in accordance with ASC 323, “ Investments—Equity Method and Joint Ventures .” We have recorded our investment at cost and will adjust the carrying amount of the investment to recognize our share of any earnings or losses of the investee.

Our investment in the unconsolidated entity is included within Other assets, net on the accompanying Condensed Balance Sheet, and our share of any earnings or losses of the unconsolidated entity will be reflected on the Consolidated Statements of Operations and Comprehensive Income.

There were no material earnings or losses recognized by the unconsolidated entity during our period of ownership;

thus, no net income or loss was recorded by us during the year ended December 31, 2019 .

During the years ended December 31, 2020 and 2019, we recorded a net loss of approximately $ 4,000 and net income of $ 0 , respectively, which represented our share of earnings or losses recognized by the unconsolidated entity during our respective periods of ownership.

Non-controlling Interests

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We evaluate whether OP Units held by non-controlling OP Unitholders are subject to redemption features outside of our control.

As of both December 31, 2019 and 2018 , the 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.

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.

Revenue Recognition

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.

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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.

During the years ended December 31, 2019 and 2018, we recorded total participation rents of approximately $2.3 million and $1.2 million , respectively.

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.

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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.

During the year ended December 31, 2018 , we wrote off approximately $108,000 of aggregate deferred rent asset and rent receivable balances related to early terminations of certain leases.

Tenant recovery revenue includes payments received from tenants as reimbursements for certain operating expenses, such as property taxes and insurance premiums.

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Other income recorded for each of the years ended December 31, 2020 and 2019 was primarily from interest patronage received on certain of our long-term borrowings (see Note 4, “ Borrowings ,” for additional information on interest patronage recorded during each of the years ended December 31, 2020 and 2019).

In addition, during the year ended December 31, 2019 , we recognized $170,000 of income related to a sale agreement for one of our farms that was terminated.

In addition, during the year ended December 31, 2020, we recognized a commission rebate of $ 200,000 that was received in connection with a property acquired during the year.

During the year ended December 31, 2019, we recognized $ 170,000 of income related to a sale agreement for one of our farms that was terminated.

Payments received from the potential buyer of the farm were initially deferred and were then recognized as income upon termination of the agreement.

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We recognize net (losses) or gains 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.

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 (loss) gain is recorded to the extent that the total consideration received for a property is (less) more than the property’s net carrying value (plus any closing costs incurred) at the time of the sale.

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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”).

We elected to be taxed as a REIT for federal income tax purposes beginning with our tax year ended December 31, 2013 .

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.

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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.

Since January 1, 2013, Land Advisers has been treated as a wholly-owned TRS that is subject to federal and state income taxes.

From October 17, 2017, through July 31, 2018, Land Advisers assumed the operations on one of our farms in California (see Note 6, “ Related-Party Transactions—TRS Lease Assumption—TRS Fee Arrangements—TRS Expense Sharing Agreement ”).

There was no material taxable income or loss from Land Advisers for either tax year ended December 31, 2019 or 2018.

In addition, there had been no activity in Land Advisers prior to 2017.

For the tax years ended December 31, 2020 and 2019, we did not have any undistributed REIT taxable income, nor was there any taxable income or loss from Land Advisers.

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,” using the asset and liability method.

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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 year ended December 31, 2019 , 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.

For the years ended December 31, 2020 and 2019, 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.

Prior to the year ended December 31, 2019, comprehensive income equaled net income;

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We manage our operations on an aggregated, single-segment basis for purposes of assessing performance and making operating decisions and, accordingly, have only one reporting and operating segment.

Reclassifications

On the accompanying Consolidated Statements of Operations and Comprehensive Income for the year ended December 31, 2019 , operating rental revenue has been reclassified to be displayed in accordance with ASU 2016-02 (as defined below), which was adopted on January 1, 2019, and acquisition-related expenses have been reclassified to be included within general and administrative expenses.

These reclassifications had no impact on previously-reported net income, equity, or net change in cash and cash equivalents.

Recently-Issued Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (the “FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”), which was amended in each of March, April, May, and December of 2016.

ASU 2014-09, as amended, supersedes or replaces nearly all GAAP revenue recognition guidance and establishes a new, control-based revenue recognition model, changes the basis for deciding when revenue is recognized over time or at a point in time and will expand disclosures about revenue.

We adopted ASU 2014-09 on January 1, 2018, using the modified retrospective method, under which the cumulative effect of initially applying the guidance was recognized at the date of initial application.

Our adoption of ASU 2014-09 did not have a material impact on our results of operations or financial condition, as the primary impact of this update is related to common area maintenance and other material tenant reimbursements, whereas the majority of our revenue is from rental income pursuant to net-lease agreements, with very little being attributed to tenant recoveries.

The impact of ASU 2014-09 did not take effect until the new leasing standard (ASU 2016-02, as defined below) became effective on January 1, 2019.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842):

An Amendment of the FASB Accounting Standards Codification” (“ASU 2016-02”), which supersedes the previous leasing standard, ASC 840, “Leases.” The new standard requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee, which classification determines whether lease expense is recognized based on an effective interest method or on a straight-line basis, respectively, over the term of the lease.

A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term of greater than 12 months, regardless of the classification.

Leases with a term of 12 months or less will be accounted for similarly to operating leases under the previous leasing standard.

The new standard requires lessors to account for leases using an approach that is substantially equivalent to that under the previous standard for sales-type leases, direct financing leases, and operating leases.

We adopted ASU 2016-02 on January 1, 2019, using the modified retrospective method, under which we recorded the cumulative effect of applying the new guidance as of the adoption date.

We also elected the package of practical expedients permitted under the transition guidance (which included that:

(i) an entity need not reassess whether any expired or existing contracts are or contain leases, (ii) an entity need not reassess the lease classification for any expired or existing leases, and (iii) an entity need not reassess initial direct costs for any existing leases), the land easement practical expedient to carry forward existing accounting treatment on existing land easements, and the lease and non-lease component combined practical expedient.

In addition, we elected the short-term lease exception, which allows us to account for leases with a term of 12 months or less similar to existing operating leases.

We currently have two operating ground lease arrangements with terms greater than one year for which we are the lessee.

See Note 7, “ Commitments and Contingencies—Ground Lease Obligations ,” for further discussion on the impact of our adoption of ASU 2016-02 and the assumptions used in determine the related right-of-use asset and lease liability.

In June 2016, the FASB issued ASU 2016-13, “Financial Instruments–Credit Losses (Topic 326):

In June 2016, the Financial Accounting Standards Board (the “FASB”) issued ASU 2016-13, “Financial Instruments–Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”).

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Pursuant to ASU 2016-13, we will be required to measure all expected credit losses based upon historical experience, current conditions, and reasonable (and supportable) forecasts that affect the collectability of the financial asset.

We are currently evaluating the impact from adopting ASU 2016-13, which is effective for fiscal years beginning after December 15, 2019, and we do not anticipate its adoption will have a material impact on our consolidated financial statements.

We adopted ASU 2016-13 on January 1, 2020, and it has not had a material impact on our consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)” (“ASU 2020-04”).

The main provisions of this update provide optional expedients and exceptions for contracts, hedging relationships, and other transactions that reference the London Inter-bank Offered Rate (“LIBOR”) or another reference rate expected to be discontinued because of reference rate reform.

ASU 2020-04 is effective for all entities as of March 12, 2020.

We adopted ASU 2020-04 on January 1, 2020, and it has not resulted in a material impact to our consolidated financial statements, as ASU 2020-04 allows for prospective application of any changes in the effective interest rate for LIBOR-based debt and also provides for practical expedients that will allow us to continue to treat our derivative instruments designed as cash flow hedges consistent to how they are accounted for now.

In April 2020, the FASB issued a staff question-and-answer document, “Topic 842 and Topic 840:

Accounting for Lease Concessions Related to the Effects of the COVID-19 Pandemic” (the “COVID-19 Q&A”), to address certain frequently-asked questions pertaining to lease concessions arising from the effects of the COVID-19 pandemic.

Existing lease guidance requires entities to determine if a lease concession was a result of a new arrangement reached with the tenant (which would be addressed under the lease modification accounting framework) or if a lease concession was under the enforceable rights and obligations within the existing lease agreement (which would not fall under the lease modification accounting framework).

The COVID-19 Q&A clarifies that entities may elect to not evaluate whether lease-related relief granted in light of the effects of COVID-19 is a lease modification, provided that the concession does not result in a substantial increase in rights of the lessor or obligations of the lessee.

This election is available for concessions that result in the total payments required by the modified contract being substantially the same as or less than the total payments required by the original contract.

In July 2020, we granted rent deferrals to two tenants who owed aggregate rents of approximately $ 343,000 , which was originally scheduled to be paid on July 1, 2020.

The agreements with these tenants provided for extensions of up to 123 days, extending the new due dates for these rental payments to be on or before November 1, 2020.

These rental payments were collected in full during the year ended December 31, 2020.

We have elected to not evaluate these lease amendments under the lease modification accounting framework.

REAL ESTATE AND INTANGIBLE ASSETS

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The following table provides certain summary information about the 137 farms we owned as of December 31, 2020 (dollars in thousands, except for footnotes):

Net Cost Basis (1)

of Farms Total

Acres Farm Acres Net Cost Basis (1)

Encumbrances (2)

California (3)

55 25,197 23,531 $ 621,549 $ 378,419

Florida 23 20,770 16,256 209,732 130,068

6 6,280 5,228 58,837 19,843

Colorado 12 32,773 25,577 48,353 30,549

Washington 3 1,384 1,001 39,467 25,475

Nebraska 9 7,782 7,050 30,672 19,296

Michigan 15 962 682 11,950 7,079

Texas 1 3,667 2,219 8,328 5,117

Maryland 4 759 693 6,308 3,728

Oregon 3 418 363 6,127 3,898

South Carolina 3 597 447 3,812 2,259

North Carolina 2 310 295 2,245 1,206

Delaware 1 180 140 1,274 753

Totals 137 101,079 83,482 $ 1,048,654 $ 627,690

(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 Investments in real estate, net (excluding improvements paid for by the tenant) and Lease intangibles, net;

plus net above-market lease values, lease incentives, and net investments in special-purpose LLCs included in Other assets, net;

plus net above-market

lease values, 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;

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(2) Excludes approximately $ 3.6 million of debt issuance costs related to notes and bonds payable, included in Notes and bonds payable, net on the accompanying Consolidated Balance Sheets.

Includes ownership in a special-purpose LLC that owns a pipeline conveying water to one of our properties.

As of December 31, 2019 , this investment had a carrying value of approximately $587,000 and is included within Other assets, net on the accompanying Consolidated Balance Sheet.

(3) Includes ownership in a special-purpose LLC that owns a pipeline conveying water to certain of our properties.

As of December 31, 2020, this investment had a net carrying value of approximately $ 1.2 million and is included within Other assets, net on the accompanying Consolidated Balance Sheets.

(4) Includes two farms in which we own a leasehold interest via ground leases with the State of Arizona that expire in February 2022 and February 2025, respectively.

In total, these two farms consist of 1,368 total acres and 1,221 farm acres and had an aggregate net cost basis of approximately $2.1 million as of December 31, 2019 (included in Lease intangibles, net on the accompanying Consolidated Balance Sheet).

In total, these two farms consist of 1,368 total acres and 1,221 farm acres and had an aggregate net cost basis of approximately $ 1.6 million as of December 31, 2020 (included in Lease intangibles, net on the accompanying Consolidated Balance Sheets).

The following table sets forth the components of our investments in tangible real estate assets as of December 31, 2020 and 2019 (dollars in thousands):

December 31, 2019

December 31, 2018

December 31, 2020 December 31, 2019

Land and land improvements $ 713,333 $ 583,247

Permanent Plantings 202,420 107,941

Irrigation and drainage systems 141,408 108,222

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The following table summarizes the carrying value of certain lease intangible assets and the related accumulated amortization as of December 31, 2020 and 2019 (dollars in thousands):

December 31, 2019

December 31, 2018

December 31, 2020 December 31, 2019

Lease intangibles:

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Lease intangibles, net $ 3,732 $ 4,827

Total amortization expense related to these lease intangible assets was approximately $1.6 million and $1.1 million for the years ended December 31, 2019 and 2018 , respectively.

Total amortization expense related to these lease intangible assets, including amounts charged to amortization expense due to lease terminations, was approximately $ 1.7 million and $ 1.6 million for the years ended December 31, 2020 and 2019, respectively.

The following table summarizes the carrying values of certain lease intangible assets or liabilities included in Other assets, net or Other liabilities, net, respectively, on the accompanying Consolidated Balance Sheets and the related accumulated amortization or accretion, respectively, as of December 31, 2020 and 2019 (dollars in thousands):

December 31, 2019

December 31, 2018

Intangible Asset or Liability

December 31, 2020 December 31, 2019

Intangible Asset or Liability Deferred

(Liability) Accumulated

(Amortization)

Accretion Deferred

(Liability) Accumulated

(Amortization)

Above-market lease values and lease incentives (1)

$ 308 $ ( 154 ) $ 111 $ ( 41 )

Below-market lease values and other deferred revenues (2)

( 908 ) 336 ( 886 ) 257

$ ( 600 ) $ 182 $ ( 775 ) $ 216

(1) Net above-market lease values and 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 on the accompanying Consolidated Statements of Operations and Comprehensive Income.

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Total accretion related to below-market lease values and other deferred revenues was approximately $ 113,000 and $ 172,000 for the years ended December 31, 2020 and 2019, respectively.

In addition, we wrote off approximately $105,000 and $117,000 of deferred rent assets and deferred rent liabilities, respectively, during the year ended December 31, 2019 , due to expiration of their respective amortization or accretion periods.

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):

Estimated Net

Period Estimated

Expense Estimated Net

Increase (Decrease)

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For the fiscal years ending December 31:

Upon our adoption of ASU 2017-01, “Business Combinations (Topic 805):

Clarifying the Definition of a Business,” on October 1, 2016, most acquisitions, including those with a prior leasing history, are generally treated as an asset acquisition under ASC 360.

For acquisitions accounted for as asset acquisitions under ASC 360, all acquisition-related costs, other than those costs that 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.

Upon our adoption of ASU 2016-02 on January 1, 2019, costs that directly related to either negotiating and originating new leases or reviewing assumed leases (generally, external legal costs) are expensed as incurred, whereas these costs were generally capitalized as part of leasing costs under the previous leasing standard.

In addition, total consideration for acquisitions may include a combination of cash and equity securities, such as OP Units.

Unless otherwise noted, all properties acquired during 2019 and 2018 were accounted for as asset acquisitions under ASC 360.

2021 $ 664 $ ( 26 )

Thereafter 895 316

$ 3,732 $ 418

2020 Acquisitions

During the year ended December 31, 2020, we acquired 26 new farms, which are summarized in the table below (dollars in thousands, except for footnotes).

Crop(s) / Use

Property Name Property

Location Acquisition

Farms Primary

Crop(s) Lease

Options Total

Price Acquisition

Straight-line

Somerset Road

County Road 18 Phillips, CO 1/15/2020 1,325 2 Sugar beets, edible beans, potatoes, & corn 6.0 years None $ 7,500 $ 39 $ 416

Lamar Valley Chase, NE 5/7/2020 678 1 Potatoes, edible beans, & corn 6.7 years 2 ( 5 years)

Driver Road (3)

Kern, CA 6/5/2020 590 1 Pecans 4.7 years 2 ( 10 years)

14,169 52 784

Hermon Wicomico & Caroline, MD, and Sussex, DE 8/31/2020 939 5 Sod & vegetables 10.0 years 2 ( 5 years)

7,347 226 432

Firestone Avenue (4)(5)(6)

Fresno, CA 9/3/2020 2,534 3 Pistachios and misc.

organic & conventional vegetables 1.2 years 2 ( 5 years)

31,833 131 1,734

West Lost Hills (4)(7)(8)

Fresno, CA 10/1/2020 801 1 Pistachios 1.1 years 4 ( 3 years)

31,827 77 1,752

Tractor Road Bamberg & Orangeburg, SC 10/23/2020 597 3 Sod 9.5 years None 3,765 72 244

American Ave Fresno, CA 12/11/2020 236 1 Current:

Table grapes;

Almonds 19.9 years 1 ( 5 years)

Round Mountain Ventura, CA 12/15/2020 368 3 Misc.

vegetables 1.6 years None 20,750 64 949

West Sierra Tulare, CA 12/17/2020 4,642 1 Almonds, pomegranates (conventional & organic), pistachios, and oats 9.9 years 1 ( 10 years)

61,500 107 3,886

Eight Mile Road (9)

San Joaquin, CA 12/24/2020 1,036 2 Conventional & organic blueberries 10.0 years 3 ( 5 years)

34,300 81 2,030

Rock Road (9)

Whatcom, WA 12/24/2020 638 2 Blueberries 10.0 years 3 ( 5 years)

31,700 74 1,885

Fountain Springs (4)

Tulare, CA 12/31/2020 160 1 Citrus (mandarins & lemons) 7.8 years 2 ( 5 years)

14,544 26 $ 255,991 $ 1,065 $ 14,809

(1) Includes approximately $ 75,000 of aggregate external legal fees associated with negotiating and originating the leases associated with these acquisitions, which costs were expensed in the period incurred.

(2) Unaudited;

based on the minimum cash rental payments guaranteed under the respective leases, as required under GAAP, and excludes contingent rental payments, such as participation rents.

(3) The lease provides for an initial term of 14.7 years and includes six tenant termination options throughout the initial term.

The lease term stated above represents the term through the first available termination option, and the annualized straight-line rent amount represents the rent guaranteed through the noncancellable term of the lease.

(4) Lease provides for an annual participation rent component based on the gross crop revenues earned on the farm.

The rent figure above represents only the minimum cash guaranteed under the lease.

(5) Lease provides for an initial term of 8.2 years but also includes an annual tenant termination option should the tenant become physically unable to continue farming operations on the property, effective as of the end of the then-current lease year (as defined within the lease).

(6) In connection with the acquisition of this property, we also acquired an ownership interest in a related LLC, the sole purpose of which is to own and maintain a pipeline conveying water to this and other neighboring properties.

Our acquired ownership, which equated to a 12.5 % interest in the LLC, was valued at approximately $ 280,000 at the time of acquisition and is included within Other assets, net on the accompanying Consolidated Balance Sheets.

See “ Investments in Unconsolidated Entities ” below for further information on our aggregate ownership interest in this LLC.

(7) Lease provides for an initial term of 3.1 years but also includes an annual tenant termination option should the tenant become physically unable to continue farming operations on the property, effective as of the end of the then-current lease year (as defined within the lease).

(8) In connection with the acquisition of this property, we also acquired an ownership interest in a related LLC, the sole purpose of which is to own and maintain a pipeline conveying water to this and other neighboring properties.

Our acquired ownership, which equated to a 12.5 % interest in the LLC, was valued at approximately $ 294,000 at the time of acquisition and is included within Other assets, net on the accompanying Consolidated Balance Sheets.

See “ Investments in Unconsolidated Entities ” below for further information on our aggregate ownership interest in this LLC.

(9) These two properties were acquired as part of a single transaction.

In addition, in connection with the acquisition of these properties, we committed to provide up to $ 3.0 million as additional compensation for a cold storage facility subject to a ground lease, contingent upon the approval by local municipal entity.

We are currently unable to estimate when or if this approval will be obtained.

During the year ended December 31, 2020, in the aggregate, we recognized operating revenues of approximately $ 2.5 million and net income of approximately $ 984,000 related to the above acquisitions.

2019 Acquisitions

During the year ended December 31, 2019, we acquired 26 new farms, which are summarized in the table below (dollars in thousands, except for footnotes).

Name Property

Location Acquisition

Farms Primary

Crop(s) / Use Lease

Options Total

Price Acquisition

Straight-line

Somerset Road Lincoln, NE 1/22/2019 695 1 Popcorn & edible beans 4.9 years 1 ( 5 years)

$ 2,400 $ 33 $ 126

Greenhills Boulevard (3)

Van Buren Trail

Van Buren, MI

& cranberries

Blue Star Highway

Van Buren, MI

Yolo County Line Road

Madera, CA 4/9/2019 928 1 Pistachios 10.6 years 2 ( 5 years)

28,550 141 1,721

Van Buren Trail Van Buren, MI 5/29/2019 159 2 Blueberries & cranberries 10.6 years 2 ( 5 years)

Blue Star Highway Allegran & Van Buren, MI 6/4/2019 357 8 Blueberries 10.6 years 2 ( 5 years)

Yolo County Line Road Yolo, CA 6/13/2019 542 1 Olives for olive oil 14.6 years 1 ( 5 years)

San Juan Grade Road (4)

Monterey, CA 7/11/2019 324 1 Strawberries & vegetables 0.3 years None 9,000 68 632

West Citrus Boulevard (5)

Sutter Avenue I (3)(6)

Martin, FL 7/22/2019 3,586 1 Water retention 8.4 years 2 ( 10 years)

57,790 516 3,696

Sutter Avenue

(Phase I) (3)(6)

Fresno, CA 8/16/2019 1,011 1 Pistachios 8.2 years 2 ( 5 years)

33,000 146 2,106

Las Posas Road (7)

Sod & vegetables

Ventura, CA 8/28/2019 413 3 Sod & vegetables 3.3 years 1 ( 2 years)

21,320 111 1,283

Withers Road (8)

Napa, CA 8/29/2019 366 1 Wine grapes 10.3 years 2 ( 10 years)

32,000 84 2,256

Highway 17 (9)

Corn, soybeans, & edible beans

Hayes, NE 10/7/2019 2,561 3 Corn, soybeans, & edible beans 0.2 years None 9,690 44 489

Indian Highway (10)

Hitchcock, NE

Corn, soybeans, & edible beans

Sutter Avenue II (3)(6)

Hayes & Hitchcock, NE 10/7/2019 1,289 2 Corn, soybeans, & edible beans 0.3 years None 5,000 36 788

Sutter Avenue

(Phase II) (3)(6)

Fresno, CA 11/1/2019 1,099 1 Pistachios 8.0 years 2 ( 5 years)

37,000 73 2,365

13,330 26 $ 252,722 $ 1,376 $ 16,682

(1) Includes approximately $ 76,000 of aggregate external legal fees associated with negotiating and originating the leases associated with these acquisitions, which were expensed in the period incurred.

Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the respective leases, as required under GAAP, and excludes contingent rental payments, such as participation rents.

Leases provide for a participation rent component based on the gross crop revenues earned on the respective farms.

(2) Unaudited;

based on the minimum cash rental payments guaranteed under the respective leases, as required under GAAP, and excludes contingent rental payments, such as participation rents.

(3) Leases provide for an annual participation rent component based on the gross crop revenues earned on the respective farms.

The rent figures above represent only the minimum cash guaranteed under the respective leases.

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(5) As partial consideration for the acquisition of this property, we issued 288,303 OP Units, constituting an aggregate fair value of approximately $ 3.3 million as of the acquisition date.

In connection with the acquisition of Sutter Avenue (which occurred in two phases), we also acquired an ownership in a related LLC, the sole purpose of which is to own and maintain a pipeline conveying water to this and other neighboring properties.

On August 16, 2019, we acquired an 11.75% ownership interest in the LLC that was valued at approximately $280,000 at the time of acquisition.

On November 1, 2019, we acquired an additional 13.25% interest in the LLC that was valued at approximately $307,000 at the time of acquisition.

As our investment in the LLC is deemed to constitute “significant influence,” we have accounted for this investment under the equity method.

From the commencement of our ownership in the LLC through December 31, 2019 , there was no material income or loss recognized by the LLC;

thus, no net income or loss was recorded by us during the year ended December 31, 2019 .

Our combined 25.0% ownership interest in the LLC, which had an aggregate carrying value of approximately $587,000 as of December 31, 2019 , is included within Other assets, net on the accompanying Consolidated Balance Sheet.

(6) In connection with the acquisition of this property (which occurred in two phases), we also acquired an ownership in a related LLC, the sole purpose of which is to own and maintain a pipeline conveying water to this and other neighboring properties.

On August 16, 2019, we acquired an 11.75 % ownership interest in the LLC that was valued at approximately $ 280,000 at the time of acquisition, and on November 1, 2019, we acquired an additional 13.25 % interest in the LLC that was valued at approximately $ 307,000 at the time of acquisition.

Our acquired ownership in the LLC is included within Other assets, net on the accompanying Consolidated Balance Sheets.

See “ Investments in Unconsolidated Entities ” below for further information on our aggregate ownership interest in this LLC.

(7) In connection with this acquisition, we executed two separate lease agreements with two different, unrelated third-party tenants.

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In addition, pursuant to one of these lease agreements, we committed to provide up to $ 1.0 million for certain irrigation improvements on the property.

In connection with the acquisition of this property, we committed to provide up to approximately $4.0 million as additional compensation, contingent upon the County of Napa approving the planting of additional vineyards on up to 47 acres of the property by February 25, 2020.

We are currently unable to estimate when this approval will be obtained, if at all.

If approval is obtained, we have also committed to contribute up to 40,000 per approved acre for the development of such vineyards.

(8) In connection with the acquisition of this property, we committed to provide up to approximately $ 4.0 million as additional compensation, contingent upon the County of Napa approving the planting of additional vineyards on up to 47 acres of the property.

Subject to such approval, we also committed to contribute up to 40,000 per approved acre for the development of such vineyards.

As provided for in the lease, we will earn additional rent on all of the aforementioned costs, if any, incurred by us.

See below, under “ Significant Existing Real Estate Activity—Property Add-on ,” for additional information on the subsequent approval of additional vineyard plantings.

(9) In connection with the acquisition of this property, we executed a 10 -year, follow-on lease with a new, unrelated third-party tenant that will commence upon the expiration of the three -month lease executed on the date of acquisition.

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During the year ended December 31, 2019, in the aggregate, we recognized operating revenues of approximately $ 6.8 million and net income of approximately $ 2.4 million related to the above acquisitions.

2018 Acquisitions

During the year ended December 31, 2018 , we acquired 13 new farms, which are summarized in the table below (dollars in thousands, except for footnotes).

Property Name

Straight-line

Taft Highway (2)

Potatoes and Melons

Cemetery Road

Van Buren, MI

Owl Hammock (3)

Collier & Hendry, FL

Vegetables and Melons

Plantation Road

Peanuts and Melons

Sunnyside Avenue (4)

Figs and Pistachios

Bunker Hill (5)

Chip Potatoes

Olsen Road (4)(6)

3 (5 years) & 1 (3 years)

Farm was purchased with no lease in place at the time of acquisition.

In connection with the acquisition of this property, we committed to provide up to $2.0 million of capital for certain irrigation and property improvements.

As stipulated in the lease, we will earn additional rental income on the total cost of the improvements as disbursements are made by us at a rate commensurate with the annual yield on the farmland (as determined by each year's minimum cash rent per the lease).

Leases provide for a participation rent component based on the gross crop revenues earned on the respective farms.

The rent figures above represent only the minimum cash guaranteed under the respective leases.

Purchase price is net of a $100,000 credit provided to us by the seller.

Lease provided for an initial rent payment of approximately $471,000 to be paid upon commencement of the lease, with all subsequent annual rent payments to be participation rents based on the gross revenues earned on the farm.

In accordance with GAAP, the initial rent payment (which represents the only cash rental payment guaranteed under the lease) is being recognized over the full term of the lease, including all tenant renewal options (which management believes to represent the minimum lease term, as defined by GAAP).

During the year ended December 31, 2018 , in the aggregate, we recognized operating revenues of approximately $1.6 million , and net income of approximately $290,000 , related to the above acquisitions.

Purchase Price Allocations

The allocation of the aggregate purchase price for the farms acquired during each of the years ended December 31, 2020 and 2019 is as follows (dollars in thousands):

Acquisition Period

Irrigation & drainage

Below-Market Leases (1)

Assets (Liabilities) Acquired 2020 Acquisitions 2019 Acquisitions

Land and Land Improvements $ 124,870 $ 164,681

Permanent plantings 93,751 58,240

Irrigation & Drainage Systems 26,837 26,184

Farm-related Facilities 6,620 2,080

Other Site Improvements 2,699 358

In-Place Leases 395 560

Leasing Costs 250 117

Above-market Lease Values (1)

Below-market Lease Values (2)

( 58 ) ( 85 )

Investment in LLC (1)

2019 Acquisitions

2018 Acquisitions

Included within Other liabilities, net on the accompanying Consolidated Balance Sheets.

Total Purchase Price $ 255,991 252,722

(1) Included within Other assets, net on the accompanying Consolidated Balance Sheets.

(2) Included within Other liabilities, net on the accompanying Consolidated Balance Sheets.

Acquired Intangibles and Liabilities

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Intangible Assets and Liabilities 2020 2019

In-place leases

In-place lease values 4.6 1.9

Leasing costs 8.3 3.0

Above-market lease values and lease incentives 10.0 0.0

Below-market lease values and other deferred revenue 1.3 2.5

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Significant Existing Real Estate Activity

Leasing Activity

The following table summarizes certain leasing activity that occurred on our existing properties during the year ended December 31, 2019 (dollars in thousands, except footnotes):

NEW LEASES (1)

Straight-line

Participation

Straight-line

Participation

AZ, CA, FL, MI, NE, TX

In connection with certain of these leases, we committed to provide capital for certain improvements on these farms.

See Note 7, “ Commitments and Contingencies—Operating Obligations ” for additional information on certain of these commitments.

Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the applicable leases (presented on an annualized basis), as required under GAAP, and excludes contingent rental payments, such as participation rents.

“NNN” refers to leases under triple-net lease arrangements, and “NN” refers to leases under partial-net lease arrangements.

For a description of each of these types of lease arrangements, see “ Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Leases—General .”

See Note 11, “ Subsequent Events—Leasing Activity ” for additional leasing activity that occurred subsequent to December 31, 2019 .

Project Completion

During 2018 and 2019, we replaced a total of 40 irrigation pivots on one of our properties in Colorado at an aggregate cost of approximately $2.6 million .

Pursuant to lease amendments executed during the year ended December 31, 2019 , in connection with this project, we will earn additional straight-line rental income of approximately $196,000 per year throughout the remaining term of the lease, which expires on February 28, 2021.

Property Add-on

In connection with the acquisition of Withers Road, we committed to provide up to approximately $ 4.0 million as additional compensation, contingent upon the County of Napa approving the planting of additional vineyards on up to 47 acres of the property by February 25, 2020 (the “Permit Deadline”).

In addition, if approval was obtained, we also committed to contribute up to $ 40,000 per approved acre for the development of such vineyards.

While approval of the additional plantings was not received from the County of Napa by the Permit Deadline, in March 2020, we executed an agreement with the tenant on Withers Road to extend the Permit Deadline until August 24, 2020.

In April 2020, we received notification from the County of Napa informing us that it had approved of additional vineyard plantings on 38.7 acres of the property.

As such, in May 2020, we paid additional compensation related to this acquisition of approximately $ 3.2 million.

As a result, and pursuant to a lease amendment, we will earn additional straight-line rental income of approximately $ 335,000 per year throughout the remaining term of the lease, which expires on December 31, 2029.

We will also earn additional rent on any of the aforementioned development costs as they are incurred by us.

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 LLC, the sole purpose of which is to own and maintain a pipeline conveying water to our and other neighboring properties.

As of December 31, 2020, our aggregate ownership interest in the LLC was 50.0 %.

As our investment in the LLC is deemed to constitute “significant influence,” we have accounted for this investment under the equity method.

During the year ended December 31, 2020, we recorded a loss of approximately $ 4,000 (included on our Condensed Consolidated Statements of Operations and Comprehensive Income as Income from investments in unconsolidated entities), which represented our pro-rata share of the loss recognized by the LLC.

Prior to fiscal year 2020, we had not recorded any material income or loss related to our ownership interest in the LLC.

Our combined ownership interest in the LLC, which had an aggregate carrying value of approximately $ 1.2 million and $ 587,000 as of December 31, 2020 and 2019, respectively, is included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets.

Future Minimum Lease Payments

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Our leases do not generally include tenant termination options.

The following tables summarize the future lease payments to be received under non-cancelable leases as of December 31, 2019 and 2018 (dollars in thousands):

As of December 31, 2019

As of December 31, 2018

For the fiscal years ending December 31,

The following tables summarize the future lease payments to be received under noncancellable leases as of December 31, 2020 (dollars in thousands):

Period Tenant

Lease Revenue

For the fiscal years ending December 31, 2021 $ 59,079

Portfolio Diversification and Concentrations

Diversification

The following table summarizes the geographic locations (by state) of our farms owned and with leases in place as of December 31, 2019 and 2018 (dollars in thousands):

As of and For the Year Ended December 31, 2019

As of and For the Year Ended December 31, 2018

California (1)

North Carolina

According to the California Chapter of the American Society of Farm Managers and Rural Appraisers, there are eight distinct growing regions within California;

our farms are spread across six of these growing regions.

Concentrations

Thereafter 149,930

Portfolio Concentrations

As of December 31, 2020, our farms were leased to 81 different, unrelated third-party tenants, with certain tenants leasing more than one farm.

One unrelated third-party tenant (“Tenant A”) leases five of our farms, and aggregate lease revenue attributable to Tenant A accounted for approximately $4.5 million , or 10.9% of the total lease revenue recorded during the year ended December 31, 2019 .

If Tenant A fails to make rental payments, elects to terminate its leases prior to their expirations, or does not renew its leases (and we cannot re-lease the farms on satisfactory terms), there could be a material adverse effect on our financial performance and ability to continue operations.

No other individual tenant represented greater than 10.0% of the total lease revenue recorded during the year ended December 31, 2019 .

No individual tenant represented greater than 10.0% of the total lease revenue recorded during the year ended December 31, 2020.

Geographic Risk

Farms located in California and Florida accounted for approximately $ 31.5 million ( 55.3 %) and $ 13.3 million ( 23.4 %), respectively, of the total lease revenue recorded during the year ended December 31, 2020.

Though we seek to continue to further diversify geographically, as may be desirable or feasible, should an unexpected natural disaster occur where our properties are located, there could be a material adverse effect on our financial performance and ability to continue operations.

None of our farms in California were materially impacted by the wildfires that occurred there during the year ended

December 31, 2019 .

Though we seek to continue to further diversify geographically, as may be desirable or feasible, should an unexpected natural disaster (such as an earthquake, wildfire, or flood) occur or climactic change impact the regions where our properties are located, there could be a material adverse effect on our financial performance and ability to continue operations.

None of our farms in California or Florida have been materially impacted by the recent wildfires or hurricanes that occurred in those respective regions.

No other single state accounted for more than 10.0% of the total rental revenue recorded during the year ended December 31, 2020.

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Our borrowings as of December 31, 2020 and 2019 are summarized below (dollars in thousands):

Carrying Value as of

As of December 31, 2019

Stated Interest

Carrying Value as of As of December 31, 2020

December 31, 2020 December 31, 2019 Stated Interest

Maturity Dates

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2/14/2022–11/1/2045;

December 2031

Variable-rate notes payable (2)

45,525 — 2.14 %– 3.00 %;

12/1/2022–11/1/2045;

Fixed-rate bonds payable 89,883 90,380 2.13 %– 4.57 %;

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Total notes and bonds payable 627,590 484,949

Debt issuance costs – notes and bonds payable

Debt issuance costs – notes and bonds payable ( 3,629 ) ( 3,120 ) N/A N/A

Notes and bonds payable, net $ 623,961 $ 481,829

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(1) Where applicable, stated interest rates are before interest patronage (as described below).

As of December 31, 2019 , the above borrowings were collateralized by certain farms with an aggregate net book value of approximately $794.8 million .

The weighted-average interest rate charged on the above borrowings (excluding the impact of debt issuance costs and before any interest patronage, or refunded interest) was 3.95% for the year ended December 31, 2019 , as compared to 3.70% for the year ended December 31, 2018 .

In addition, 2018 interest patronage from our Farm Credit Notes Payable (as defined below), which we received and recorded during the three months ended March 31, 2019, resulted in an 21.2% reduction (approximately 95 basis points) to the stated interest rates on such borrowings.

We are unable to estimate the amount of interest patronage to be received, if any, related to interest accrued during 2019 on our Farm Credit Notes Payable.

(2) Notes were fixed subsequent to December 31, 2020;

see Note 11, “ Subsequent Events .”

As of December 31, 2020, the above borrowings were collateralized by certain of our farms with an aggregate net book value of approximately $ 1.04 billion.

The weighted-average interest rate charged on the above borrowings (excluding the impact of debt issuance costs and before any interest patronage, or refunded interest) was 3.95 % for each of the years ended December 31, 2020 and 2019.

In addition, 2019 interest patronage from our Farm Credit Notes Payable (as defined below), which we received and recorded during the three months ended March 31, 2020, resulted in a 20.4 % reduction (approximately 98 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.

Our loan agreements generally contain various affirmative and negative covenants, including with respect to liens, indebtedness, mergers, and asset sales, and customary events of default.

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MetLife Facility

On May 9, 2014 , we closed on a credit facility (the “MetLife Facility”) with Metropolitan Life Insurance Company (“MetLife”).

As a result of subsequent amendments, as of December 31, 2019 , the MetLife Facility consisted of an aggregate of $200.0 million of term notes (the “MetLife Term Notes”) and $75.0 million of revolving equity lines of credit (the “MetLife Lines of Credit”).

During the year ended December 31, 2019 , we drew the following amounts on the MetLife Term Notes (dollars in thousands):

Interest Rate Terms (1)

3.70%, fixed through January 4, 2027 (variable thereafter)

3.81%, fixed through January 4, 2027 (variable thereafter)

The interest rates on these new disbursements were blended with the existing interest rate on the previously-outstanding balance under the MetLife Term Notes.

The following table summarizes the pertinent terms of the MetLife Facility as of December 31, 2019 (dollars in thousands, except for footnotes):

Interest Rate Terms

MetLife Term Notes

3.42%, fixed through 1/4/2027

MetLife Lines of Credit

3-month LIBOR + 2.00%

As of December 31, 2019, our facility with Metropolitan Life Insurance Company (“MetLife”) consisted of a total of $ 200.0 million of term notes (the “Prior MetLife Term Notes”) and $ 75.0 million of revolving equity lines of credit (the “MetLife Lines of Credit,” and together with the Prior MetLife Term Notes, the “Prior MetLife Facility”).

The draw period for the Prior MetLife Term Notes expired on December 31, 2019, with approximately $ 21.5 million being left undrawn, and MetLife had no obligation to disburse the remaining funds under those notes.

On February 20, 2020, we entered into an agreement with MetLife to remove the MetLife Lines of Credit from the Prior MetLife Facility and create a new credit facility consisting of a new $ 75.0 million long-term note payable (the “New MetLife Term Note”) and the MetLife Lines of Credit (collectively, the “New MetLife Facility”).

The following table summarizes the pertinent terms of the New MetLife Facility as of December 31, 2020 (dollars in thousands, except for footnotes):

Issuance Aggregate

Commitment Maturity

Dates Principal

Outstanding Interest Rate Terms Undrawn

New MetLife Term Note $ 75,000 (1)

1/5/2030 $ 36,900 2.75 % (2)

MetLife Lines of Credit 75,000 4/5/2024 100 3-month LIBOR + 2.00 %

Total principal outstanding $ 37,000

Represents the blended interest rate as of December 31, 2019 .

Interest rates for subsequent disbursements, if any, will be based on then-prevailing market rates.

The interest rate on all then-outstanding disbursements will be subject to adjustment on January 5, 2027 .

Through December 31, 2019 , the MetLife Term Notes were also subject to an unused fee ranging from 0.10% to 0.20% on undrawn amounts (based on the balance drawn under the notes).

As the aggregate commitment under this facility was not fully utilized by December 31, 2019 , MetLife had the option to be relieved of its obligations to disburse the additional funds under the MetLife Term Notes.

(1) If the aggregate commitment under the New MetLife Term Note is not fully utilized by December 31, 2022, MetLife has the option to be relieved of its obligation to disburse the additional funds under the New MetLife Term Note.

(2) Interest rates on future disbursements under the New MetLife Term Note will be based on prevailing market rates at the time of such disbursements.

In addition, through December 31, 2022, the New MetLife Term Note is also subject to an unused fee ranging from 0.10 % to 0.20 % on undrawn amounts (based on the balance drawn under the New MetLife Term Note).

(3) Based on the properties that were pledged as collateral under the MetLife Facility, as of December 31, 2020, the maximum additional amount we could draw under the facility was approximately $ 24.2 million.

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During the year ended December 31, 2020, we entered into the following loan agreements with Farm Credit (dollars in thousands):

Issuer Date of

Issuance Amount Maturity

Date Principal

Amortization Stated Interest Rate (1)

Interest Rate Terms

Premier Farm Credit, FLCA

5.45%, fixed through October 31, 2023 (variable thereafter)

GreenStone Farm Credit Services

5.00%, fixed through June 30, 2029 (variable thereafter)

GreenStone Farm Credit Services

5.00%, fixed through June 30, 2029 (variable thereafter)

Farm Credit West, FLCA

4.24%, fixed through July 31, 2026 (variable thereafter)

Farm Credit of Central Florida, ACA

5.05%, fixed throughout term

Farm Credit of Central Florida, ACA

(interest only)

5.05%, fixed throughout term

Premier Farm Credit, FLCA 5/14/2020 $ 4,500 1/1/2045 24.6 years 4.00 % Fixed through December 31, 2029 (variable thereafter)

Farm Credit West, FLCA 6/24/2020 600 5/1/2044 24.2 years 3.00 % Fixed through July 31, 2026 (variable thereafter)

Farm Credit West, FLCA 6/24/2020 600 5/1/2044 24.2 years 3.00 % Fixed through August 31, 2026 (variable thereafter)

Farm Credit West, FLCA 6/25/2020 8,500 11/1/2045 25.0 years 3.75 % Fixed through June 30, 2030 (variable thereafter)

Farm Credit of the Virginias, ACA 8/31/2020 4,481 9/1/2030 25.0 years 3.99 % Fixed throughout term

Farm Credit West, FLCA (2)

3.84%, fixed through August 31, 2026 (variable thereafter) (2)

American AgCredit, ACA

3.84%, fixed through August 31, 2029 (variable thereafter)

12/10/2020 2,160 11/1/2045 24.5 years 3.70 % Fixed through January 31, 2031 (variable thereafter)

(1) Stated rate is before interest patronage, as described below.

Loan originally issued as a variable-rate loan and was converted to a fixed-rate loan effective September 1, 2019.

(2) Loan was fixed subsequent to December 31, 2020;

see Note 11, “ Subsequent Events—Financing Activity—Borrowing Activity—Fixed Rate Conversions .”

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.

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 payments are made.

During the three months ended March 31, 2019, we recorded interest patronage of approximately $700,000 related to interest accrued on loans from Farm Credit during the year ended December 31, 2018, which resulted in a 21.2% reduction (approximately 95 basis points) to the stated interest rates on such borrowings.

During the three months ended March 31, 2020, we recorded interest patronage of approximately $ 1.3 million related to interest accrued on loans from Farm Credit during the year ended December 31, 2019, which resulted in a 20.4 % reduction (approximately 98 basis points) to the stated interest rates on such borrowings.

During the three months ended September 30, 2020, we also received approximately $ 306,000 of additional interest patronage related to our Farm Credit Notes Payable, as certain Farm Credit associations prepaid a portion of the 2020 interest patronage (which relates to interest accrued during 2020 but is typically received in 2021).

Farmer Mac Facility

On December 5, 2014, we, through certain subsidiaries of our Operating Partnership, 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.

As subsequently amended, the Bond Purchase Agreement provided for bond issuances up to an aggregate amount of $125.0 million (the “Farmer Mac Facility”) through December 11, 2018 , after which date the Bond Purchaser had the option to continue buying new bonds issued under the Farmer Mac Facility.

During the year ended December 31, 2019 , we amended and restated two bonds totaling approximately $13.9 million that were previously issued under the Farmer Mac Facility and were originally scheduled to mature on December 11, 2019, and January 6, 2020, respectively.

The pertinent terms of the two amended and restated bonds are summarized in the table below (dollars in thousands):

Date of Issuance

Maturity Dates

Principal Amortization

Interest Rate Terms

(interest only)

fixed throughout term

(interest only)

fixed throughout term

As subsequently amended, the Bond Purchase Agreement provided for bond issuances up to an aggregate amount of $ 125.0 million (the “Prior Farmer Mac Facility”) through December 11, 2018, after which date the Bond Purchaser had the option to continue buying new bonds issued under the Farmer Mac Facility.

On December 10, 2020, we entered into an amended and restated bond purchase agreement (the “Amended and Restated Bond Purchase Agreement”) with Farmer Mac and the Bond Purchaser, increasing the secured note purchase facility to provide for bond issuances up to an aggregate principal amount of $ 225.0 million (the “New Farmer Mac Facility”).

In addition, the Amended and Restated Bond Purchase Agreement extended the date up to which we can issue new bonds to May 31, 2023 and

final maturity date for bonds issued under the Farmer Mac Facility to December 31, 2030.

The Amended and Restated Bond Purchase Agreement also included certain adjustments to the Fixed Charge Coverage Ratio definition and the Fixed Charge Ratio Covenant.

All other terms of the Bond Purchase Agreement remained the same.

During the year ended December 31, 2020, we amended and restated three bonds totaling approximately $ 22.0 million that were previously issued under the Prior Farmer Mac Facility and were originally scheduled to mature on December 11, 2019, and January 6, 2020, respectively.

The pertinent terms of the three amended and restated bonds are summarized in the table below (dollars in thousands):

Date of Issuance Amount Maturity Dates Principal Amortization Stated Interest Rate Interest Rate Terms

1/10/2020 $ 8,100 1/12/2024 None

(interest only) 2.66 % Fixed throughout term

12/11/2020 3,180 7/31/2023 None

(interest only) 2.13 % Fixed throughout term

12/11/2020 10,673 10/31/2028 None

(interest only) 3.25 % Fixed throughout term

No prepayment penalties were incurred in connection with these amendments, and all other material items of the amended and restated bonds remained unchanged.

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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.

Prudential Note Payable

During the year ended December 31, 2019 , we entered into a loan agreement with PGMI Real Estate Finance, LLC (“Prudential”), the terms of which are summarized in the following table (dollars in thousands):

Date of Issuance

Maturity Date

Principal Amortization

Interest Rate Terms

4.00%, fixed throughout term

Approximately $498,000 of this funding was held back by the lender until certain irrigation improvements on the property were completed and is included within Other assets on the accompanying Consolidated Balance Sheet as of December 31, 2019 .

We currently expect these irrigation improvements to be completed during the three months ending March 31, 2020, at which point these funds will be released to us pursuant to an escrow holdback agreement.

Rabo Notes Payable

During the year ended December 31, 2019 , we, through certain subsidiaries of our Operating Partnership, entered into the following loan agreements with Rabo AgriFinance, LLC (“Rabo”):

Date of Issuance

Maturity Date

Principal Amortization

Interest Rate Terms

1-Month LIBOR + 1.75% (1)

1-Month LIBOR + 1.75% (2)

In connection with securing this loan and to hedge our exposure to the above variable interest rate, we entered into an interest rate swap agreement in which we agreed to pay a fixed interest rate to our counterparty of 4.04% through June 1, 2029.

See “ —Interest Rate Swap Agreements ” below for additional information on this swap agreement.

In connection with securing these loans, we entered into two interest rate swap agreements in which we agreed to pay a fixed interest rate to our counterparty of 3.67% through October 1, 2029.

See “ —Interest Rate Swap Agreements ” below for additional information on these swap agreements.

Diversified Financial Note Payable

During the year ended December 31, 2019 , we entered into a loan agreement with Diversified Financial Services, LLC (“Diversified Financial”) to finance approximately $1.1 million of irrigation improvements we funded on one of our properties in Colorado (See Note 3, “ Real Estate and Lease Intangibles—Significant Existing Real Estate Activity—Project Completions ”).

The following table summarizes the pertinent terms of our term loan from Diversified Financial (dollars in

Date of Issuance

Maturity Date

Principal Amortization

Interest Rate Terms

4.75%, fixed throughout term

Other Borrowings

During the year ended December 31, 2020, we entered into loan agreements with various other lenders, the terms of which are summarized in the following table (dollars in thousands):

Lender Date of Issuance Amount Maturity Date Principal Amortization Stated Interest Rate Interest Rate Terms

Conterra Agricultural Capital, LLC 6/8/2020 $ 2,100 7/1/2027 30.0 years 3.40 % Fixed throughout term

PGIM Real Estate Finance, LLC 10/1/2020 19,042 7/1/2028 25.0 years 2.47 % Fixed throughout term

PGIM Real Estate Finance, LLC 10/1/2020 19,096 7/1/2028 25.0 years 2.45 % Fixed throughout term

AgAmerica Lending, LLC 10/23/2020 2,259 1/1/2028 30.0 years 3.50 % Fixed throughout term

PGIM Real Estate Finance, LLC 12/15/2020 12,450 7/1/2028 None

(interest only) 2.98 % Fixed throughout term

Rabo AgriFinance, LLC (1)

12/24/2020 37,170 12/1/2030 25.0 years 2.14 % 1-month LIBOR + 2.00 % (1)

Rabo AgriFinance, LLC (1)

12/24/2020 6,195 12/1/2022 None

(interest only) 2.14 % 1-month LIBOR + 2.00 % (1)

(1) Subsequent to December 31, 2020 , we entered into fixed interest rate swap agreements for each of these loans.

See Note 11, “ Subsequent Events—Financing Activity—Borrowing Activity—Fixed Rate Conversions ,” for additional information on these swap agreements.

Debt Service – Aggregate Maturities

Scheduled principal payments of our aggregate notes and bonds payable as of December 31, 2020, for the succeeding years are as follows (dollars in thousands):

For the Fiscal Years Ending December 31,

For the Fiscal Years Ending December 31, Scheduled

Principal Payments

2021 $ 19,848

Thereafter 436,180

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.

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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, 2019 , the aggregate fair value of our long-term, fixed-rate notes and bonds payable was approximately $484.7 million , as compared to an aggregate carrying value (excluding unamortized related debt issuance costs) of approximately $484.9 million .

As of December 31, 2020, the aggregate fair value of our notes and bonds payable was approximately $ 628.3 million, as compared to an aggregate carrying value (excluding unamortized related debt issuance costs) of approximately $ 627.6 million .

The fair value of our long-term, fixed-rate 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 of the MetLife Lines of Credit and the lack of changes in market credit spreads, their aggregate fair value as of December 31, 2019 , is deemed to approximate their aggregate carrying value of $100,000 .

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, 2020, is deemed to approximate their aggregate carrying value of $ 100 ,000.

Interest Rate Swap Agreements

To hedge our exposure to variable interest rates, during the year ended December 31, 2019 , we 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 fixed rate interest rate on a quarterly basis and receive payments from our counterparty equivalent to the respective stipulated floating rates.

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 fixed interest rate on a quarterly basis and receive payments from our counterparty equivalent 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.

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We record changes in fair value on a quarterly basis, using current market valuations at quarter end.

We had not entered into any interest rate swap agreements prior to the year ended December 31, 2019 .

The following table summarizes our interest rate swaps as of December 31, 2019 (dollars in thousands):

Aggregate Notional Amount

Aggregate Fair Value Asset

Aggregate Fair Value Liability

The following table presents the amount of loss recognized in comprehensive income within our consolidated financial statements for the year ended December 31, 2019 (dollars in thousands):

Year Ended December 31, 2019

The following table summarizes our interest rate swaps as of December 31, 2020 and 2019 (dollars in thousands):

Period Aggregate Notional Amount Aggregate Fair Value Asset Aggregate Fair Value Liability

As of December 31, 2020 $ 14,077 $ — $ 1,500

As of December 31, 2019 14,298 — 390

The following table presents the amount of loss recognized in comprehensive income within our consolidated financial statements for the years ended December 31, 2020 and 2019 (dollars in thousands):

For the Year Ended December 31, 2020 For the Year Ended December 31, 2019

Derivative in cash flow hedging relationship:

Interest rate swaps $ (1,110) $ ( 390 )

The following table summarizes certain information regarding our derivative instruments as of December 31, 2019 (dollars in thousands):

Derivative Type

Balance Sheet Location

Total $ ( 1,110 ) $ ( 390 )

The following table summarizes certain information regarding our derivative instruments as of December 31, 2020 and 2019 (dollars in thousands):

Derivative Liability Fair Value

Derivative Type Balance Sheet Location December 31, 2020 December 31, 2019

Derivatives Designated as Hedging Instruments:

Interest rate swaps

Other liabilities, net

Interest rate swaps Other liabilities, net $ 1,500 $ 390

Total $ 1,500 $ 390

MANDATORILY-REDEEMABLE PREFERRED STOCK

In August 2016 , we completed a public offering of 6.375% Series A Cumulative Series A Term Preferred Stock, par value $0.001 per share (the “Series A Term Preferred Stock”), at a public offering price of $25.00 per share.

In August 2016, we completed a public offering of 6.375 % Series A Cumulative Term Preferred Stock, par value $ 0.001 per share (the “Series A 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 1,150,000 shares of the Series A Term Preferred Stock for gross proceeds of approximately $ 28.8 million and net proceeds, after deducting underwriting discounts and offering expenses borne by us, of approximately $ 27.6 million.

The Series A Term Preferred Stock is traded under the ticker symbol “LANDP” on Nasdaq.

Generally, we were not permitted to redeem shares of the Series A Term Preferred Stock prior to September 30, 2018, except in limited circumstances to preserve our qualification as a REIT.

Since September 30, 2018 , we have been permitted to 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.

The shares of the Series A Term Preferred Stock have a mandatory redemption date of September 30, 2021 , and are not convertible into our common stock or any other securities.

As of December 31, 2019 , no shares of Series A Term Preferred Stock have been redeemed.

Since September 30, 2018, we were permitted to 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.

The shares of the Series A Term Preferred Stock had a mandatory redemption date of September 30, 2021, and were not convertible into our common stock or any other securities.

As of December 31, 2020, no shares of Series A Term Preferred Stock were redeemed.

We incurred approximately $ 1.2 million in total offering costs related to this issuance, which have been recorded net of the Series A 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.

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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, 2019 , the fair value of our Series A Term Preferred Stock was approximately $29.6 million , as compared to the carrying value (exclusive of offering costs), of approximately $28.8 million .

The fair value of our Series A Term Preferred Stock is valued using Level 1 inputs under the hierarchy established by ASC 820-10, “Fair Value Measurements and Disclosures,” and is calculated based on the closing per-share stock price as of December 31, 2019 , of $25.70 .

Due to the short-term maturity of our Series A Term Preferred Stock, its carrying value (exclusive of unamortized offering costs) of approximately $ 28.8 million was deemed to approximate its fair value as of December 31, 2020.

Subsequent to December 31, 2020, we issued a new series of mandatorily-redeemable preferred stock and redeemed all of our outstanding shares of Series A Term Preferred Stock (see Note 11, “ Subsequent Events ,” for more information on both events).

For information on the dividends declared by our Board of Directors and paid by us on the Series A Term Preferred Stock during the years ended December 31, 2020 and 2019, see Note 8, “ Equity—Distributions .”

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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.

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.

In addition, two of our executive officers, Mr.

Gladstone and Terry Brubaker (our vice chairman and chief operating officer), serve as directors and executive officers of each of our Adviser and Administrator, and Michael LiCalsi, our general counsel and secretary, serves as our Administrator’s president, general counsel, and secretary.

Gladstone and Terry Brubaker (our vice chairman and chief operating officer), serve as directors and executive officers of each of our Adviser and Administrator, and Michael LiCalsi, our general counsel and secretary (who also serves as our Administrator’s president, general counsel, and secretary) is also executive vice president of administration of our Adviser.

We have entered into an investment advisory agreement with our Adviser and an administration agreement with our Administrator (the “Administration Agreement”).

The advisory agreement with our Adviser that was in effect through June 30, 2019 (the “Prior Advisory Agreement”), was amended on July 9, 2019 (as amended, the “2019 Advisory Agreement” and, together with the “Prior Advisory Agreement,” the “Advisory Agreements”), and was approved unanimously by our board of directors, including our independent directors.

The advisory agreement with our Adviser that was in effect through March 31, 2017, and the Administration Agreement each became effective February 1, 2013.

The advisory agreement with our Adviser that was in effect through June 30, 2019 (the “Prior Advisory Agreement”), was amended and restated on July 9, 2019 (as amended, the “2019 Advisory Agreement”), and again amended and restated on January 14, 2020 (as amended, the “2020 Advisory Agreement,” and, together with the Prior Advisory Agreement and the 2019 Advisory Agreement, the “Advisory Agreements”).

The Administration Agreement and each of the Advisory Agreements 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.

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Advisory Agreements

Pursuant to both the Prior Advisory Agreement, which was in effect from April 1, 2017, through June 30, 2019, and the 2019 Advisory Agreement, which was in effect from July 1, 2019, through December 31, 2019, our Adviser was compensated in the form of a base management fee and, each as applicable, an incentive fee, a capital gains fee, and a termination fee.

Pursuant to each of the Prior Advisory Agreement (which was in effect from April 1, 2017, through June 30, 2019), the 2019 Advisory Agreement (which was in effect from July 1, 2019, through December 31, 2019), and the 2020 Advisory Agreement (which has been in effect since January 1, 2020), 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.

The 2019 Advisory Agreement modified the calculation of the base management and incentive fees to exclude preferred equity from such calculations, while the capital gains and termination fees remained unchanged.

The 2020 Advisory Agreement revised and replaced the previous calculation of the base management fee, which was previously based on equity, with a calculation based on gross real estate assets, while all other fees remained unchanged.

Each of the base management, incentive, capital gains, and termination fees is described below.

See Note 11, “ Subsequent Events—Amendment to 2019 Advisory Agreement, ” for a discussion of an amendment to the 2019 Advisory Agreement, which will impact the calculation of the base management fee beginning with the three months ending March 31, 2020.

Base Management Fee

Pursuant to the Prior Advisory Agreement, a base management fee was paid quarterly and was calculated as 2.0% per annum ( 0.50% per quarter) of the prior calendar quarter’s total adjusted equity, which was defined as total equity plus total mezzanine equity, 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 (“Total Adjusted Equity”).

Under the 2019 Advisory Agreement, a base management fee was paid quarterly and was calculated as 2.0% per annum ( 0.50% per quarter) of the prior calendar quarter’s total adjusted common equity, which was 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 (“Total Adjusted Common Equity”).

During the years ended December 31, 2019 and 2018, our Adviser granted us certain non-contractual, unconditional, and irrevocable waivers, which were applied as credits against the base management fees for the respective periods, as detailed in the table below under “ —Related-Party Fees .”

Pursuant to the Prior Advisory Agreement, a base management fee was paid quarterly and was calculated as 2.0 % per annum ( 0.50 % per quarter) of the calendar quarter’s total adjusted equity, which was defined as total equity plus total mezzanine equity, 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 (“Total Adjusted Equity”).

Pursuant to the 2019 Advisory Agreement, a base management fee was paid quarterly and was calculated as 2.0 % per annum ( 0.50 % per quarter) of the prior calendar quarter’s total adjusted common equity, which was 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 (“Total Adjusted Common Equity”).

Under the 2020 Advisory Agreement, a base management fee is paid quarterly and is calculated at an annual rate of 2.00 % ( 0.500 % 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, irrigation and drainage systems, permanent plantings, 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.

During the year ended December 31, 2019 , our Adviser granted us certain non-contractual, unconditional, and irrevocable waivers, which were applied as credits against the base management fee for the period, as detailed in the table below under “ —Related-Party Fees .” We did not have any such waivers for the year ended December 31, 2020.

Incentive Fee

Pursuant to the Prior Advisory Agreement, an incentive fee was 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 Equity.

Under the 2019 Advisory Agreement, an incentive fee was 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.

Under the 2019 Advisory Agreement and the 2020 Advisory Agreement, an incentive fee was 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 was defined in each of the Advisory Agreements as FFO (also as defined in each of the Advisory Agreements) accrued by the Company during the current calendar quarter (prior to any incentive fee calculation for the current calendar quarter), less any dividends paid on preferred stock securities that were not treated as a liability for GAAP purposes.

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Capital Gains Fee

Pursuant to both of the Advisory Agreements, a capital gains-based incentive fee will be calculated and payable in arrears at the end of each fiscal year (or upon termination of the agreement with our Adviser).

Pursuant to each of the Advisory Agreements, a capital gains-based incentive fee will be calculated and payable in arrears at the end of each fiscal year (or upon termination of the agreement with our Adviser).

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).

(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.

Our sale of a property during the year ended December 31, 2018 , contributed to our Adviser earning a capital gains fee for the first time since our inception.

However, during the year ended December 31, 2018 , our Adviser granted us a non-contractual, unconditional, and irrevocable waiver, which was applied as a credit against the capital gains fee, as detailed in the table below under “ —Related-Party Fees .”

Termination Fee

Pursuant to both of the Advisory Agreements, 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.

Pursuant to each of the Advisory Agreements, 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

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As approved by our Board of Directors, effective July 1, 2014, 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.

TRS Lease Assumption

On October 17, 2017 , Land Advisers entered into an Assignment and Assumption of Agricultural Lease (the “Assigned TRS Lease”) with the previously-existing tenant on a 169 -acre farm located in Ventura County, California.

The Assigned TRS Lease, as amended, expired on July 31, 2018 .

In addition, in connection with the initial operations on the farm, on October 17, 2017 , Land Advisers issued a $1.7 million unsecured promissory note to the Company that matured on July 31, 2018 , and bore interest at a rate equal to the prime rate plus a spread of 5.0% per annum.

All inter-company amounts related to the Assigned TRS Lease and the promissory note were eliminated in consolidation, and, as a result, no rental or interest income from Land Advisers was recorded by us on the Consolidated Statements of Operations and Comprehensive Income during the year ended December 31, 2018 .

Effective August 1, 2018, this farm was leased to a new, unrelated third-party tenant under a 10 -year lease.

TRS Fee Arrangements

In connection with the assumption of the Assigned TRS Lease, in exchange for services provided by our Adviser to Land Advisers, our Adviser and Land Advisers entered into an Expense Sharing Agreement (the “TRS Expense Sharing Agreement”).

In addition, to account for the time our Administrator’s staff spent on activities related to Land Advisers, we adopted a policy wherein a portion of the fee paid by the Company to our Administrator pursuant to the Administration Agreement would be allocated to Land Advisers (the “TRS Administration Fee Allocation”).

No such fees were incurred during the year ended December 31, 2019 .

TRS Expense Sharing Agreement

Pursuant to the TRS Expense Sharing Agreement, our Adviser was responsible for maintaining the day-to-day operations on the farm leased to Land Advisers from October 17, 2017, through July 31, 2018.

In exchange for such services, Land Advisers compensated our Adviser through reimbursement of certain expenses incurred by our Adviser, including Land Advisers’ pro-rata share of our Adviser’s payroll and related benefits (based on the percentage of each employee’s time devoted to matters related to Land Advisers in relation to the time such employees devoted to all affiliated funds, collectively, advised by our Adviser) and general overhead expenses (based on the total general overhead expenses incurred by our Adviser multiplied by the ratio of hours worked by our Adviser’s employees on matters related to Land Advisers to the total hours worked by our Adviser’s employees).

Costs incurred by our Adviser, while payable by Land Advisers, were initially accumulated and deferred and then allocated to costs of sales as the related crops were harvested and sold.

During the year ended December 31, 2018 , approximately $176,000 of the total accumulated costs incurred by our Adviser was allocated to the costs of crops sold and is included within Base management fee on the accompanying Consolidated Statements of Operations and Comprehensive Income for the year ended December 31, 2018 .

In addition, during the year ended December 31, 2018 , our Adviser granted Land Advisers a non-contractual, unconditional, and irrevocable waiver to be applied against a portion of the fees incurred by our Adviser on behalf of Land Advisers pursuant to the TRS Expense Sharing Agreement, as detailed in the table below under “ —Related-Party Fees .”

TRS Administration Fee Allocation

Under to the TRS Administration Fee Allocation, a portion of the fee owed by us to our Administrator under the Administration Agreement is allocated to Land Advisers based on the percentage of each employee’s time devoted to matters related to Land Advisers in relation to the total time such employees devoted to the Company.

During the year ended December 31, 2018 , approximately $57,000 of the administration fee paid by us was allocated to Land Advisers.

This allocation is included within Administration Fee on the accompanying Consolidated Statements of Operations and Comprehensive Income.

Gladstone Securities

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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, serving as Chief Legal Officer, Secretary, and a member of its board of managers since 2010 and a managing principal since 2011.

Financing Arrangement Agreement

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Through December 31, 2020, 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 Agreement

On January 10, 2018 , we entered into a dealer-manager agreement, which was amended and restated on May 31, 2018 (the “Dealer-Manager Agreement”), with Gladstone Securities, whereby Gladstone Securities serves as our exclusive dealer-manager in connection with the offering of our 6.00% Series B Cumulative Redeemable Preferred Stock (the “Series B Preferred Stock”).

Pursuant to the Dealer-Manager Agreement, Gladstone Securities provides certain sales, promotional, and marketing services to us in connection with the offering of the Series B Preferred Stock, and we generally will pay Gladstone Securities:

(i) selling commissions of up to 7.0% of the gross proceeds from sales of Series B Preferred Stock in the offering (the “Selling Commissions”), and (ii) a dealer-manager fee of 3.0% of the gross proceeds from sales of Series B Preferred Stock in the offering (the “Dealer-Manager Fee”).

Gladstone Securities may, in its sole discretion, remit all or a portion of the Selling Commissions and may also reallow all or a portion of the Dealer-Manager Fees to participating broker-dealers and wholesalers in support of the offering.

Series B Dealer-Manager Agreement

On January 10, 2018, we entered into a dealer-manager agreement, which was amended and restated on May 31, 2018 (the “Series B Dealer-Manager Agreement”), with Gladstone Securities, whereby Gladstone Securities serves as our exclusive dealer-manager in connection with the offering of our Series B Preferred Stock (as defined in Note 8, “ Equity—Series B Preferred Stock ”).

Pursuant to the Series B Dealer-Manager Agreement, Gladstone Securities provides certain sales, promotional, and marketing services to us in connection with the offering of the Series B Preferred Stock, and we generally will pay Gladstone Securities:

(i) selling commissions of up to 7.0 % of the gross proceeds from sales of Series B Preferred Stock in the offering (the “Series B Selling Commissions”), and (ii) a dealer-manager fee of 3.0 % of the gross proceeds from sales of Series B Preferred Stock in the offering (the “Series B Dealer-Manager Fee”).

Gladstone Securities was permitted, in its sole discretion, to remit all or a portion of the Series B Selling Commissions and also to reallow all or a portion of the Series B Dealer-Manager Fees to participating broker-dealers and wholesalers in support of the offering.

The terms of the Dealer-Manager Agreement were approved by our board of directors, including all of its independent directors.

During the years ended December 31, 2019 and 2018, we paid total Selling Commissions and Dealer-Manager Fees to Gladstone Securities in connection with sales of the Series B Preferred Stock of approximately $7.6 million and $2.3 million , respectively.

Selling Commissions and Dealer-Manager Fees paid to Gladstone Securities are netted against the gross proceeds received from sales of the Series B Preferred Stock and are included within Additional paid-in capital on the accompanying Consolidated Balance Sheets.

During the years ended December 31, 2020 and 2019, we paid total Series B Selling Commissions and Series B Dealer-Manager Fees to Gladstone Securities of approximately $ 2.5 million and $ 7.6 million, respectively, in connection with sales of the Series B Preferred Stock.

The majority of these amounts were then remitted by Gladstone Securities to unrelated third parties involved in the offering, including participating broker-dealers and wholesalers.

Series B Selling Commissions and

Series B Dealer-Manager Fees paid to Gladstone Securities were netted against the gross proceeds received from sales of the Series B Preferred Stock and are included within Additional paid-in capital on the accompanying Consolidated Balance Sheets.

The offering of our Series B Preferred Stock was completed on March 5, 2020.

Series C Dealer-Manager Agreement

On February 20, 2020, we entered into a dealer-manager agreement (the “Series C Dealer-Manager Agreement”), with Gladstone Securities, whereby Gladstone Securities will serve as our exclusive dealer-manager in connection with the offering of our Series C Preferred Stock (as defined in Note 8, “ Equity—Equity Issuances—Series C Preferred Stock ”).

Pursuant to the Series C Dealer-Manager Agreement, Gladstone Securities provides certain sales, promotional, and marketing services to us in connection with the offering of the Series C Preferred Stock, and we pay Gladstone Securities (i) selling commissions of up to 6.0 % of the gross proceeds from sales of Series C Preferred Stock (the “Series C Selling Commissions”) in the Primary Series C Offering (as defined in Note 8, “ Equity—Equity Issuances—Series C Preferred Stock ”), and (ii) a dealer-manager fee of 3.0 % of the gross proceeds from sales of Series C Preferred Stock in the Primary Series C Offering (the “Series C Dealer-Manager Fee”).

No Series C Selling Commissions or Series C Dealer-Manager Fee shall be paid with respect to shares of the Series C Preferred Stock sold pursuant to our dividend reinvestment plan (the “DRIP”) for the Series C Preferred Stock.

Gladstone Securities may, in its sole discretion, reallow a portion of the Series C Dealer-Manager Fee to participating broker-dealers in support of the Primary Series C Offering.

The terms of the Series C Dealer-Manager Agreement were approved by our board of directors, including all of our independent directors.

During the year ended December 31, 2020, we paid total Series C Selling Commissions and Series C Dealer-Manager Fees to Gladstone Securities of approximately $ 2.2 million in connection with sales of the Series C Preferred Stock.

The majority of these amounts were then remitted by Gladstone Securities to unrelated third parties involved in the offering, including participating broker-dealers and wholesalers.

Series C Selling Commissions and Series C Dealer-Manager Fees paid to Gladstone Securities are netted against the gross proceeds received from sales of the Series C Preferred Stock and are included within Additional paid-in capital on the accompanying Condensed Consolidated Balance Sheets.

Related Party Fees

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Base management fee (1)(2)

$ 4,289 $ 3,623

Incentive fee (1)(2)

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Administration fee (1)(2)

$ 1,448 $ 1,207

Selling Commissions and Dealer-Manager Fees (1)(3)

$ 4,711 $ 7,645

Financing fees (1)(4)

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(2) Reflected as a line item on our accompanying Consolidated Statements of Operations and Comprehensive Income.

Includes the allocation of approximately $176,000 of the total accumulated costs incurred by our Adviser as a result of the crops harvested and sold on the farm operated by Land Advisers during the year ended December 31, 2018 , as further described above under “ TRS Expense Sharing Agreement .”

Includes the portion of administration fee that was allocated to Land Advisers (approximately $57,000 for the year ended December 31, 2018 ), as further described above under “ TRS Administration Fee Allocatio n.”

(3) Included within Additional paid-in capital on the accompanying Consolidated Balance Sheets.

(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.

Through December 31, 2019 , 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.

Related-Party Fees Due

Amounts due to related parties on our accompanying Consolidated Balance Sheets as of December 31, 2020 and 2019 were as follows (dollars in thousands):

December 31, 2019

December 31, 2018

Due from Gladstone Securities

December 31, 2020 December 31, 2019

Base management fee $ 1,130 $ 881

Incentive fee 883 847

Capital gains fee

Credits to fees

Other, net (1)

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Total due to Administrator 438 416

Total due to Gladstone Securities (3)

Total due to related parties (4)

Represents costs for certain sales, promotional, or marketing services related to the offering of the Series B Preferred Stock paid for by us on behalf of Gladstone Securities.

Such amounts are included within Other assets, net on our accompanying Consolidated Balance Sheet.

The credit to the capital gains fee as of December 31, 2018 , was a result of capital losses recorded in connection with dispositions of certain real estate assets during the year ended December 31, 2018 , which resulted in a reduction of the capital gains fee accrued for earlier in fiscal year 2018.

The credits received from our Adviser during the year ended December 31, 2018 , were granted as non-contractual, unconditional, and irrevocable waivers to be applied as a credit against the base management fee.

$ 2,484 $ 2,169

(1) Other fees 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.

The balance owed to our Adviser as of December 31, 2019 , included miscellaneous general and administrative expenses.

Includes approximately $9,000 owed by Land Advisers to our Administrator as of December 31, 2018 , in accordance with the TRS Administration Fee Allocation, as discussed above.

Represents the cumulative accrued but unpaid portion of prior Administration fees that are scheduled to be paid during the three months ending September 30, 2020, which is the quarter following our Administrator’s fiscal year end.

(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) Represents miscellaneous costs related to the Series C Offering paid by Gladstone Securities on our behalf.

(4) Reflected as a line item on our accompanying Consolidated Balance Sheets.

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In connection with the execution of certain lease agreements, we have committed to provide capital improvements on certain of our farms, which are summarized in the table below (dollars in thousands):

Location Farm

Acreage Total

Commitment Obligated

Amount Expended

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Hillsborough, FL 55 $ 2,250 (2)

Van Buren, MI

Q2 2021 $ 780

Tulare, CA 160 700 (2)

Wicomico & Caroline, MD, and Sussex, DE 833 115 Q3 2021 36

Van Buren, MI 89 150 Q4 2021 126

Napa, CA 270 1,548 (2)

Santa Barbara, CA 271 4,000 (2)

Q3 2024 2,410

Columbia, OR 157 1,800 (2)

Q3 2024 1,146

Collier & Hendry, FL 3,612 2,000 (2)

Monterey, CA 304 1,248 Q4 2025 1,188

(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.

Pursuant to the agreement, we will only earn additional rent if the total amount of capital improvements exceeds $1.3 million

Pursuant to the agreement, we will only earn additional rent if the total amount of capital improvements exceeds $860,000

Ground Lease Obligations

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These two operating ground leases expire in February 2022 and February 2025, and neither lease contains any extension, renewal, or termination options.

Upon our adoption of ASU 2016-02 on January 1, 2019 , we recognized an operating lease right-of-use asset of approximately $218,000 and an operating lease liability of approximately $213,000 as a result of these ground leases.

Upon our adoption of ASU 2016-02, “Leases (Topic 842):

An Amendment of the FASB Accounting Standards Codification,” on January 1, 2019, we recognized an operating lease right-of-use asset of approximately $ 218,000 and an operating lease liability of approximately $ 213,000 as a result of these ground leases.

These values were determined by discounting the respective future minimum lease payments using a discount rate equivalent to treasury rates with similar terms plus a spread ranging from 2.47 % to 2.53 %.

As of December 31, 2019 , we recorded the following as a result of these operating ground leases (dollars in thousands, except for footnotes):

As of December 31, 2020 and 2019, we recorded the following as a result of these operating ground leases (dollars in thousands, except for footnotes):

December 31, 2020 December 31, 2019

Operating lease right-of-use assets (1)

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Weighted-average discount rate 4.20 % 4.20 %

Operating lease right-of-use assets are shown net of accrued lease payments of approximately $6,000 and are included within Other assets, net on the accompanying Consolidated Balance Sheet.

Included within Other liabilities, net on the accompanying Consolidated Balance Sheet.

(1) Operating lease right-of-use assets are shown net of accrued lease payments of approximately $ 6,000 as of each December 31, 2020 and 2019 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.

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 $ 59,000 and $ 50,000 during the years ended December 31, 2020 and 2019, respectively.

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Future Lease Payments (1)

December 31, 2019

December 31, 2018

Period December 31, 2020 December 31, 2019

2020 $ — $ 47

Thereafter — —

Total undiscounted lease payments 138 185

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Amendment to Articles of Incorporation

On January 10th, 2018, we filed with the Maryland Department of Assessments and Taxation Articles Supplementary to reclassify and designate 6,500,000 shares of our authorized and unissued shares of capital stock as shares of Series B Preferred Stock (as defined below).

The reclassification decreased the number of shares classified from 98,000,000 to 91,500,000 .

Stockholders’ Equity

As of December 31, 2019 , there were 6,500,000 shares of Series B Preferred Stock, par value $0.001 per share, authorized, with 4,755,869 shares issued and outstanding worth an aggregate liquidation value of approximately $118.9 million ;

and 91,500,000 shares of common stock, par value $0.001 per share, authorized, with 20,936,658 shares issued and outstanding.

As of December 31, 2018 , there were 6,500,000 shares of Series B Preferred Stock, par value $0.001 per share, authorized, with 1,144,393 shares issued and outstanding worth an aggregate liquidation value of approximately 28,609,825 ;

and 91,500,000 shares of common stock, par value $0.001 per share, authorized, with 17,891,340 shares issued and outstanding.

On February 20, 2020, we filed with the Maryland Department of Assessments and Taxation an Articles Supplementary (i) setting forth the rights, preferences, and terms of the Series C Preferred Stock and (ii) reclassifying and designating 26,000,000 shares of our authorized and unissued shares of common stock as shares of Series C Preferred Stock.

The reclassification decreased the number of shares classified as common stock from approximately 91.5 million shares immediately prior to the reclassification to 65.5 million shares immediately after the reclassification.

Subsequent to December 31, 2020, we further amended our articles of incorporation in connection with the issuance of the Series D Preferred Stock (as defined in Note 11, “ Subsequent Events—Financing Activity—Borrowing Activity ”).

See Note 11, “ Subsequent Events—Financing Activity—Equity Activity, ” for additional information on this amendment to our articles of incorporation.

Amendment to Operating Partnership Agreement

In connection with the authorization of the Series C Preferred Stock, the Operating Partnership adopted the Fourth Amendment to its First Amended and Restated Agreement of Limited Partnership (collectively, the “Amendment”), establishing the rights, privileges, and preferences of 6.00 % Series C Cumulative Redeemable Preferred Units, a newly-designated class of limited partnership interests (the “Series C Preferred OP Units”).

The Amendment provides for the Operating Partnership’s establishment and issuance of an equal number of Series C Preferred OP Units as are issued shares of Series C Preferred Stock

by the Company in connection with the Series C Offering upon the Company’s contributions to the Operating Partnership of the net proceeds of the Series C Offering.

Generally, the Series C Preferred OP Units provided for under the Amendment have preferences, distribution rights and other provisions substantially equivalent to those of the Series C Preferred Stock.

Subsequent to December 31, 2020, we further amended our Operating Partnership agreement in connection with the issuance of the Series D Preferred Stock (as defined in Note 11, “ Subsequent Events—Financing Activity—Borrowing Activity ”).

See Note 11, “ Subsequent Events—Financing Activity—Equity Activity, ” for additional information on this amendment to our Operating Partnership agreement.

Non-Controlling Interests in Operating Partnership

We consolidate our Operating Partnership, which is a majority-owned partnership.

As of December 31, 2019 and 2018 , we owned approximately 98.6% and 96.9% , respectively, of the outstanding OP Units.

As of December 31, 2020 and 2019, we owned 100.0 % and approximately 98.6 %, respectively, of the outstanding OP Units.

As of December 31, 2020 and 2019, there were 0 and 288,303 OP Units held by non-controlling OP Unitholders, respectively.

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.

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Information related to OP Units issued during the year December 31, 2019, is provided in the table below (dollars in thousands, except per-unit amounts):

Number of OP Units Issued

Weighted-average Issuance Price

Aggregate Value (1)

Number of OP Units Issued Weighted-average Issuance Price Aggregate Value (1)

288,303 $ 11.41 $ 3,290

(1) Based on the closing stock price of the Company’s common stock on the date of issuance.

Information related to OP Units tendered for redemption during the years ended December 31, 2020 and 2019 is provided in the table below (dollars in thousands, except per-unit amounts):

OP Units Tendered

for Redemption

Shares of Common

OP Units Redeemed

Aggregate Cash

Paid per OP Unit

Year Ended December 31, 2019

Year Ended December 31, 2018

Period OP Units Tendered

for Redemption Shares of Common

For the year ended December 31, 2020 288,303 288,303

For the year ended December 31, 2019 570,879 570,879

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.

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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.

As of December 31, 2019 and 2018 , there were 288,303 and 570,879 OP Units held by non-controlling OP Unitholders, respectively.

As of December 31, 2019 , none of the 288,303 OP Units were eligible to be tendered for redemption.

Registration Statement

On March 30, 2017, we filed a universal registration statement on Form S-3 (File No.

333-217042) with the SEC (the “2017 Registration Statement”) to replace our previous registration statement, which expired on April 1, 2017.

The 2017 Registration Statement, which was declared effective by the SEC on April 12, 2017, permits us to issue up to an aggregate of $300.0 million in securities, consisting of common stock, preferred stock, warrants, debt securities, depository shares, subscription rights, and units, including through separate, concurrent offerings of two or more of such securities.

Through December 31, 2019 , we have issued a total of 7,870,469 shares of common stock (excluding 1,215,565 shares of common stock issued in exchange for certain OP Units that were tendered for redemption) for gross proceeds of approximately $96.7 million and 4,770,469 shares of Series B Preferred Stock (as defined below) for gross proceeds of approximately $117.3 million under the 2017 Registration Statement.

See Note 11, “ Subsequent Events ” for equity issuances completed subsequent to December 31, 2019 .

333-217042) with the SEC (the “2017 Registration Statement”) to replace our previous registration statement.

The 2017 Registration Statement, which was declared effective by the SEC on April 12, 2017, permitted us to issue up to an aggregate of $ 300.0 million in securities, consisting of common stock, preferred stock, warrants, debt securities, depository shares, subscription rights, and units, including through separate, concurrent offerings of two or more of such securities.

Under the 2017 Registration Statement, we issued a total of 9,495,834 shares of common stock (excluding 1,215,565 shares of common stock issued in exchange for certain OP Units that were tendered for redemption) for gross proceeds of approximately $ 117.4 million and 6,000,000 shares of Series B Preferred Stock for gross proceeds of approximately $ 147.5 million.

On March 6, 2020, we filed a universal registration statement on Form S-3 (File No.

333-236943) with the SEC (the “2020 Registration Statement”) to replace the 2017 Registration Statement.

The 2020 Registration Statement, which was declared effective by the SEC on April 1, 2020, permits us to issue up to an aggregate of $ 1.0 billion in securities, consisting of common

stock, preferred stock, warrants, debt securities, depository shares, subscription rights, and units, including through separate, concurrent offerings of two or more of such securities.

Through December 31, 2020, we had issued a total of 4,584,258 shares of common stock (excluding 288,303 shares of common stock issued in exchange for certain OP Units that were tendered for redemption) for gross proceeds of approximately $ 67.8 million and approximately 1,088,573 shares of Series C Preferred Stock (excluding redemptions) for gross proceeds of approximately $ 27.0 million under the 2020 Registration Statement.

In conjunction with the filing of the 2020 Registration Statement, we wrote off approximately $ 29 ,000 of unallocated costs associated with the initial filing of the 2017 Registration Statement.

These costs were written off to professional fees, which is included within General and administrative expenses on our accompanying Condensed Consolidated Statements of Operations and Comprehensive Income, during the year ended December 31, 2020.

Equity Issuances

Series B Preferred Stock

On January 10, 2018, we filed a prospectus supplement with the SEC for a continuous public offering of our Series B Preferred Stock, which was terminated on May 31, 2018, prior to any shares being sold.

On May 31, 2018, we filed a revised prospectus supplement with the SEC for a continuous public offering of up to 6,000,000 shares (the “Series B Offering”) of our Series B Preferred Stock at an offering price of $25.00 per share for gross proceeds of up to $150.0 million and net proceeds, after deducting dealer-manager fees, selling commissions, and estimated expenses of the offering payable by us, of up to approximately $131.3 million , assuming all shares of the Series B Preferred Stock are sold in the offering.

The Series B Preferred Stock is being offered on a continuous, “reasonable best efforts” basis by Gladstone Securities, the dealer-manager for the Series B Offering.

See Note 6, “ Related-Party Transactions—Gladstone Securities—Dealer-Manager Agreement ,” for a discussion of the fees and commissions to be paid to Gladstone Securities in connection with the Series B Offering.

On May 31, 2018, we filed a prospectus supplement with the SEC for a continuous public offering of up to 6,000,000 shares (the “Series B Offering”) of our 6.00 % Series B Cumulative Redeemable Preferred Stock (the “Series B Preferred Stock”) at an offering price of $ 25.00 per share for gross proceeds of up to $ 150.0 million.

The Series B Preferred Stock was offered on a continuous, “reasonable best efforts” basis by Gladstone Securities, the dealer-manager for the Series B Offering.

See Note 6, “ Related-Party Transactions—Gladstone Securities—Series B Dealer-Manager Agreement ,” for a discussion of the fees and commissions paid to Gladstone Securities in connection with the Series B Offering.

The following table provides information on sales of the Series B Preferred Stock that occurred during the years ended December 31, 2020 and 2019 (dollars in thousands, except per-share amounts):

Period Number of

Shares Sold Weighted-average

Offering Price

per Share Gross Proceeds Net Proceeds (1)

Year Ended December 31, 2020 1,229,531 $ 24.52 $ 30,148 $ 27,664

Year Ended December 31, 2019 3,626,076 24.61 89,232 81,587

(1) Net of Series B Selling Commissions and Series B Dealer-Manager Fees borne by us.

The following table provides information on redemptions of the Series B Preferred Stock that occurred during the years ended December 31, 2020 and 2019 (dollars in thousands, except per-share amounts):

Period Number of

Shares Redeemed Weighted-average

Redemption Price

per Share Cash Redemption Paid

Year Ended December 31, 2020 29,335 $ 23.22 $ 681

Year Ended December 31, 2019 14,600 23.30 340

The Series B Offering was completed on March 9, 2020 (the “Series B Termination Date”), with the full 6,000,000 allotted shares being sold, and, exclusive of redemptions, resulted in total gross proceeds of approximately $ 147.5 million and net proceeds, after deducting Series B Selling Commissions, Series B Dealer-Manager Fees, and offering expenses payable by us, of approximately $ 133.4 million.

Excluding Series B Selling Commissions and Series B Dealer-Manager Fees, we incurred approximately $ 1.6 million of total costs related to the Series B Offering, which were initially recorded as deferred offering costs (included within Other assets, net on the accompanying Consolidated Balance Sheets) and were applied against the gross proceeds received from the offering through additional paid-in capital as shares of the Series B Preferred Stock were sold.

During the year ended December 31, 2020, we listed the Series B Preferred Stock on Nasdaq under the ticker symbol “LANDO.” Trading of the Series B Preferred Stock on Nasdaq commenced on October 19, 2020.

Series C Preferred Stock

On February 20, 2020, we filed a prospectus supplement with the SEC for a continuous public offering of up to 400,000 shares of our newly-designated 6.00 % Series C Cumulative Redeemable Preferred Stock, par value $ 0.001 per share (the “Series C Preferred Stock”), on a “reasonable best efforts” basis through Gladstone Securities at an offering price of $ 25.00 per share, and up to 120,000 shares of our Series C Preferred Stock pursuant to the DRIP at a price of $ 22.75 per share.

No shares of the Series C Preferred Stock were sold pursuant to the prospectus supplement dated February 20, 2020.

On April 3, 2020, we filed a new prospectus supplement with the SEC for a continuous offering of up to 26,000,000 shares of the Series C Preferred Stock, which superseded and replaced the prospectus supplement dated February 20, 2020, for a continuous public offering (the “Series C Offering”) of up to 26,000,000 shares of the Series C Preferred Stock.

The Series C Offering permits us to sell up to 20,000,000 shares (the “Primary Series C Offering”) of our Series C Preferred Stock on a “reasonable best efforts” basis through Gladstone Securities at an offering price of $ 25.00 per share and up to 6,000,000 shares of our Series C Preferred Stock pursuant to the DRIP at a price of $ 22.75 per share.

See Note 6, “ Related-Party Transactions—Gladstone Securities—Series C Dealer-Manager Agreement ,” for a discussion of the commissions and fees to be paid to Gladstone Securities in connection with the Series C Offering.

The following table provides information on sales of the Series C Preferred Stock that occurred during the year ended December 31, 2020 (dollars in thousands, except per-share amounts):

Period Number of

Shares Sold (1)

Weighted Average

Offering Price

Gross Proceeds

Net Proceeds (1)

For the year ended December 31, 2019

For the year ended December 31, 2018

Net of selling commissions and dealer-manager fees borne by us.

In addition, during the year ended December 31, 2019 , 14,600 shares of the Series B Preferred Stock were tendered for redemption at a weighted-average cash redemption price of $23.30 per share.

As a result, we paid total redemption costs of approximately $340,000 to redeem and retire these shares.

No shares of the Series B Preferred Stock were redeemed during the year ended December 31, 2018 .

As of December 31, 2019 , excluding Selling Commissions and Dealer-Manager Fees, we have incurred approximately $1.2 million of total costs related to this offering, which are initially recorded as deferred offering costs (included within Other assets, net on the accompanying Consolidated Balance Sheets) and are applied against the gross proceeds received from the offering through additional paid-in capital as shares of the Series B Preferred Stock are sold.

See Note 11, “Subsequent Events—Equity Activity—Series B Preferred Stock,” for sales of Series B Preferred Stock completed subsequent to December 31, 2019 .

The Series B Offering will terminate on the date (the “Termination Date”) that is the earlier of either June 1, 2023 (unless terminated earlier or extended by our Board of Directors), or the date on which all 6,000,000 shares offered in the offering are sold.

There is currently no public market for shares of the Series B Preferred Stock;

however, we intend to apply to list the Series B Preferred Stock on Nasdaq or another national securities exchange within one calendar year after the Termination Date, though there can be no assurance that a listing will be achieved in such timeframe, or at all.

Per Share Gross Proceeds Net Proceeds (2)

Year Ended December 31, 2020 1,088,315 $ 24.80 $ 26,987 $ 24,759

(1) Excludes shares issued pursuant to the DRIP.

During the year ended December 31, 2020, we issued approximately 258 shares of the Series C Preferred Stock pursuant to the DRIP.

(2) Net of Series C Selling Commissions and Series C Dealer-Manager Fees.

The following table provides information on redemptions of the Series C Preferred Stock that occurred during the year ended December 31, 2020 and (dollars in thousands, except per-share amounts):

Period Number of

Shares Redeemed Weighted-average

Redemption Price

per Share Cash Redemption Paid

Year Ended December 31, 2020 138 $ 22.50 $ 3

As of December 31, 2020, excluding Series C Selling Commissions and Series C Dealer-Manager Fees, we have incurred approximately $ 282,000 of costs related to the Series C Offering, which are initially recorded as deferred offering costs (included within Other assets, net on the accompanying Condensed Consolidated Balance Sheets) and are applied against gross proceeds received from the offering through additional paid-in capital as shares of the Series C Preferred Stock are sold.

See Note 11, “ Subsequent Events—Equity Activity—Series C Preferred Stock ,” for sales of Series C Preferred Stock completed subsequent to December 31, 2020.

The Series C Offering will terminate on the date (the “Series C Termination Date”) that is the earlier of either June 1, 2025 (unless terminated earlier or extended by our Board of Directors), or the date on which all 20,000,000 shares in the Primary Series C Offering are sold.

There is currently no public market for shares of the Series C Preferred Stock;

however, we intend to apply to list the Series C Preferred Stock on Nasdaq or another national securities exchange within one calendar year after the Series C Termination Date, though there can be no assurance that a listing will be achieved in such timeframe, or at all.

Follow-on Offerings

During the years ended December 31, 2019 and 2018 , we completed one and two , respectively, overnight public offerings of our common stock, which are summarized in the following table (dollars in thousands, except per-share amounts):

We completed an overnight public offering of our common stock during each of the years ended December 31, 2020 and 2019, which are summarized in the following table (dollars in thousands, except per-share amounts):

Period Number of

Shares Sold (1)

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Offering Price

Gross Proceeds (1)

Per Share Gross Proceeds (1)

Net Proceeds (1)(2)

For the year ended December 31, 2019

For the year ended December 31, 2018

Year Ended December 31, 2020 1,897,500 $ 14.40 $ 27,324 $ 26,094

Year Ended December 31, 2019 2,277,297 11.73 26,713 25,401

(1) Includes the underwriters’ exercise of the over-allotment option in connection with each offering.

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At-the-Market Program

On August 7, 2015, we entered into equity distribution agreements (commonly referred to as “at-the-market agreements”), as amended from time to time, with Cantor Fitzgerald & Co., Ladenburg Thalmann & Co., Inc., and Virtu Americas, LLC (each a “Sales Agent”), under which we may 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 $30.0 million (the “ATM Program”).

The following table provides information on shares of common stock sold by the Sales Agents under the ATM Program during the years ended December 31, 2019 and 2018 (dollars in thousands, except per-share amounts):

Weighted-average

On August 7, 2015, we entered into equity distribution agreements (commonly referred to as “at-the-market agreements”), as amended from time to time, with Cantor Fitzgerald & Co., Ladenburg Thalmann & Co., Inc., and Virtu Americas, LLC (each a “Sales Agent”), under which we were permitted 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 $ 30.0 million (the “Prior ATM Program”).

On May 12, 2020, we terminated the Prior ATM Program and entered into new equity distribution agreements with Virtu Americas, LLC, and

Ladenburg Thalmann & Co., Inc., under which we may issue and sell, from time to time and through the current Sales Agents, shares of our common stock having an aggregate offering price of up to $ 100.0 million (the “Current ATM Program,” and collectively with the Prior ATM Program, the “ATM Programs”).

The following table provides information on shares of common stock sold by the Sales Agents under the ATM Programs during the years ended December 31, 2020 and 2019 (dollars in thousands, except per-share amounts):

Period Number of

Shares Sold Weighted-average

Offering Price

Gross Proceeds

Net Proceeds (1)

For the year ended December 31, 2019

For the year ended December 31, 2018

Per Share Gross Proceeds Net Proceeds (1)

Year Ended December 31, 2020 3,096,558 $ 14.82 $ 45,883 $ 45,424

Year Ended December 31, 2019 197,142 12.24 2,413 2,377

(1) Net of underwriting commissions and discounts.

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For the Years Ended December 31,

Issuance 2020 2019

Series A Term Preferred Stock (1)

$ 1.59375 $ 1.59375

Series B Preferred Stock (2)

Series C Preferred Stock (2)

Common Stock (3)

0.53715 0.53430

(1) Treated similar to interest expense on the accompanying Consolidated Statements of Operations and Comprehensive Income.

Of the dividends declared on the Series B Preferred Stock by our Board of Directors on October 8, 2019, approximately $594,000 was paid (as scheduled) by us on January 3, 2020.

The resulting dividend payable is included within Accounts payable and accrued expenses on the accompanying Consolidated Balance Sheets as of December 31, 2019 .

(2) Of the aggregate dividends declared on the Series B Preferred Stock and Series C Preferred Stock by our Board of Directors on October 31, 2020, and October 8, 2019, approximately $ 881,000 and $ 594,000 , respectively, was paid (as scheduled) by us on January 5, 2021, and January 3, 2020, respectively.

(3) The same amounts were paid as distributions on each OP Unit held by non-controlling OP Unitholders.

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The characterization of distributions on our preferred and common stock during each of the years ended December 31, 2020 and 2019 is reflected in the following table:

Income Return of

Capital Long-term

For the Year Ended December 31, 2020:

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Series B Preferred Stock 70.743160 % 29.256840 % — %

Series C Preferred Stock 70.743160 % 29.256840 % — %

Common Stock — % 100.000000 % — %

For the Year Ended December 31, 2019:

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Series B Preferred Stock 100.000000 % — % — %

Common Stock 2.668400 % 97.331600 % — %

LEASE REVENUES

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Fixed lease payments (1)

$ 51,377 $ 38,168

Variable lease payments (2)

Lease revenue, net (3)

$ 57,031 $ 40,692

(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.

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During the years ended December 31, 2020 and 2019, we recorded participation rents of approximately $ 2.4 million and $ 2.3 million respectively, and reimbursements of certain property operating expenses by tenants of approximately $ 457,000 and $ 198,000 , respectively.

In addition, during the year ended December 31, 2020, we received a lease termination payment of approximately $ 3.0 million.

(3) Reflected as a line item on our accompanying Consolidated Statements of Operations and Comprehensive Income.

(LOSS) EARNINGS PER SHARE OF COMMON STOCK

The following table sets forth the computation of basic and diluted (loss) earnings per common share for the years ended December 31, 2019 and 2018 , computed using the weighted-average number of shares outstanding during the respective periods.

Net (loss) 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 (loss) income.

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, 2020 and 2019, computed using the weighted-average number of shares outstanding during the respective periods.

Net earnings figures are presented net of non-controlling interests in the earnings per share calculations.

(Dollars in thousands, except per-share amounts)

Net (loss) income attributable to common stockholders

Net loss attributable to common stockholders $ ( 4,396 ) $ ( 2,499 )

Weighted average shares of common stock outstanding – basic and diluted 22,258,121 19,602,533

(Loss) earnings per common share – basic and diluted

Loss per common share – basic and diluted $ ( 0.20 ) $ ( 0.13 )

The weighted-average number of OP Units held by non-controlling OP Unitholders was 131,745 and 235,613 for the years ended December 31, 2020 and 2019, respectively.

SUBSEQUENT EVENTS

Portfolio Activity

Acquisition Activity

Subsequent to December 31, 2019 , through the date of this filing, we have acquired two farms, which are summarized in the table below (dollars in thousands, except for footnotes):

Straight-line

County Road 18

Sugar beets, edible beans, potatoes, & corn

Acquisition will be accounted for as an asset acquisition in accordance with ASC 360.

The figures above represent only costs paid or accrued for as of the date of this filing.

Leasing Activity

The following table summarizes the leasing activity that occurred on our existing properties subsequent to December 31, 2019 , through the date of this filing (dollars in thousands):

Straight-line

Participation

/ NN / N) (2)

Straight-line

Participation

/ NN / N) (2)

AZ, CA, NC, & NE

Annualized straight-line rent is based on the minimum cash rental payments guaranteed under the leases (presented on an annualized basis), as required under GAAP, and excludes contingent rental payments, such as participation rents.

“NNN” refers to leases under triple-net lease arrangements, “NN” refers to leases under partial-net lease arrangements, and “N” refers to leases under single-net lease arrangements For a description of each of these types of lease arrangements, see “ Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Leases—General .”

Lease Termination

On February 10, 2020, we reached an agreement with a tenant occupying four of our farms in Arizona to terminate the existing leases encompassing those four farms effective February 10, 2020.

As part of the termination agreement, the outgoing tenant made a one-time termination payment to us of approximately $3.0 million , which will be recognized as additional lease revenue by us during the three months ending March 31, 2020.

The prior leases were scheduled to expire on September 15, 2026 (with two of the farms subject to the renewal of certain state leases currently scheduled to expire on February 14, 2022, and February 14, 2025), and in connection with the early termination of these leases, we will write off an aggregate net deferred rent balance of approximately $104,000 , which will also be written off during the three months ending March 31, 2020.

In addition, upon termination of these leases, we entered into a new, seven -year lease with a new tenant effective immediately.

These leases are included in the Leasing Activity table above.

Financing Activity

Debt Activity—New Borrowings

Borrowing Activity

On January 10, 2020 , we amended and restated a 2.80% fixed-rate bond for $8.1 million that was previously issued under the Farmer Mac Facility and was originally scheduled to mature on January 10, 2020.

The amended bond is for an equal amount and will bear interest at a fixed rate of 2.66% through its maturity on January 12, 2024 .

All other material items of the amended and restated bond remained unchanged.

New Borrowings

Subsequent to the year ended December 31, 2020, we entered into the following loan agreements with the terms of which are summarized in the following table (dollars in thousands):

Lender Date of

Issuance Amount Maturity Date Principal Amortization Stated Interest Rate Interest Rate Terms

Farm Credit West, FLCA 1/28/2021 $ 2,073 11/1/2045 24.8 years 3.23 % Fixed through December 31, 2027 (variable thereafter)

Farmer Mac 2/4/2021 2,460 10/31/2028 25.0 years 3.13 % Fixed throughout term

Fixed Rate Conversions

Certain loans we secured during the year ended December 31, 2020, were initially issued at variable rates.

Subsequent to December 31, 2020, we fixed the interest rates on these loans, as summarized in the following table (dollars in thousands):

Lender Date of Fixed

Agreement Loan

Amount Original Variable Interest Rate Terms New Fixed Interest Rate Terms

Farm Credit West, FLCA 1/8/2021 $ 2,160 3.00 %, subject to change monthly

3.70 %, fixed through 1/31/2031;

variable thereafter

Rabo AgriFinance, LLC (1)

1/15/2021 37,170 1-month LIBOR + 2.00 %

fixed throughout term

Rabo AgriFinance, LLC (1)

1/15/2021 6,195 1-month LIBOR + 2.00 %

fixed throughout term

(1) Interest rates were fixed via our entry into interest rate swap agreements.

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 selling concessions and underwriting fees, of approximately $ 58.5 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 are not permitted to redeem shares of the Series D Term Preferred Stock prior to January 31, 2023, except in limited circumstances to preserve our status as a REIT.

On or 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.

Dividends on the Series D Term Preferred Stock will be cumulative from, but excluding, the date of original issue and payable monthly in arrears, beginning on February 28, 2021, at an annual rate of 5.00 % of the liquidation preference, or $ 25.00 per share.

Redemption of Series A Term Preferred Stock

On February 12, 2021, we redeemed all of our outstanding shares of Series A Term Preferred Stock at a cash redemption price of $ 25.00 per share plus all accrued and unpaid dividends up to, but excluding, the redemption date.

In total, we paid approximately $ 28.8 million for the redemption of the Series A Term Preferred Stock using proceeds from the offering of our Series D Term Preferred Stock.

Our Series A Term Preferred Stock was delisted from Nasdaq on the date we redeemed all outstanding shares.

In connection with this early redemption, during the three months ending March 31, 2021, we anticipate writing off approximately $ 127,000 of unamortized issuance costs related to the issuance of the Series A Term Preferred Stock.

Equity Activity

The following table provides information on equity sales that have occurred subsequent to December 31, 2019 (dollars in thousands, except per-share amounts):

Type of Issuance

Weighted Average Offering Price

Gross Proceeds

Net Proceeds (1)

Series B Preferred Stock

Amendment to Articles of Incorporation

On January 13, 2021, we filed with the State Department of Assessments and Taxation of Maryland the Articles Supplementary (i) setting forth the rights, preferences and terms of the Series D Term Preferred Stock and (ii) reclassifying and designating 3,600,000 shares of our authorized and unissued shares of common stock as shares of Series D Term Preferred Stock.

Amendment to Operating Partnership Agreement

On January 13, 2021, the Operating Partnership adopted the Fifth Amendment to its First Amended and Restated Agreement of Limited Partnership, including Exhibit SD thereto (collectively, the “Amendment”), as amended from time to time, establishing the rights, privileges, and preferences of 5.00 % Series D Cumulative Term Preferred Units, a newly-designated class of limited partnership interests (the “Series D Preferred Units”).

The Amendment provides for the Operating Partnership’s establishment and issuance of an equal number of Series D Preferred Units as are issued shares of Series D Term Preferred Stock by the Company in connection with the offering of Series D Term Preferred Stock upon the Company’s contribution to the Operating Partnership of the net proceeds of the offering of Series D Term Preferred Stock.

Generally, the Series D Term Preferred Units provided for under the Amendment have preferences, distribution rights, and other provisions substantially equivalent to those of the Series D Preferred Stock.

Equity Issuances

The following table provides information on certain equity sales that have occurred subsequent to December 31, 2020 (dollars in thousands, except per-share amounts):

Type of Issuance Number of

Shares Sold Weighted-average

Offering Price

Per Share Gross Proceeds Net Proceeds (1)

Series C Preferred Stock (2)

313,646 $ 24.88 $ 7,802 $ 7,135

Common Stock – ATM Program 524,148 14.47 7,582 7,507

Net of Selling Commissions and Dealer-Manager Fees or underwriting commissions and discounts (in each case, as applicable)

In addition, subsequent to December 31, 2019 , 5,753 shares of the Series B Preferred Stock were redeemed at a weighted-average cash redemption price of $24.41 per share.

As a result, we paid a total redemption cost of approximately $140,000 to redeem and retire these shares.

(1) Net of Series C Selling Commissions and Series C Dealer-Manager Fees or underwriting commissions and discounts (in each case, as applicable).

(2) Excludes approximately 367 shares issued pursuant to the DRIP.

Distributions

On January 12, 2021, our Board of Directors declared the following monthly cash distributions to holders of our preferred and common stock:

Distribution per Share

Issuance Record Date Payment Date Distribution per Share

Series A Term Preferred Stock:

January 24, 2020

January 31, 2020

February 19, 2020

February 28, 2020

March 20, 2020

March 31, 2020

January 22, 2021 January 29, 2021 $ 0.1328125

Total Series A Term Preferred Stock Distributions:

Series B Preferred Stock:

January 22, 2020

January 31, 2020

February 26, 2020

March 4, 2020

March 25, 2020

April 1, 2020

January 27, 2021 February 5, 2021 $ 0.125

February 24, 2021 March 5, 2021 0.125

March 24, 2021 April 5, 2021 0.125

Total Series B Preferred Stock Distributions:

Series C Preferred Stock:

January 27, 2021 February 5, 2021 $ 0.125

February 24, 2021 March 5, 2021 0.125

March 24, 2021 April 5, 2021 0.125

Total Series C Preferred Stock Distributions:

Series D Term Preferred Stock (1) :

February 17, 2021 February 28, 2021 (2)

March 25, 2021 April 5, 2021 0.104167

Total Series D Term Preferred Stock Distributions:

Common Stock (3) :

January 24, 2020

January 31, 2020

February 19, 2020

February 28, 2020

March 20, 2020

March 31, 2020

January 22, 2021 January 29, 2021 $ 0.04495

February 17, 2021 February 26, 2021 0.04495

March 18, 2021 March 31, 2021 0.04495

Total Common Stock Distributions:

(1) Dividends on the Series D Term Preferred Stock were declared on January 25, 2021.

(2) To be paid on the following business day.

(3) The same amounts paid to common stockholders will be paid as distributions on each OP Unit held by non-controlling OP Unitholders as of the above record dates.

Amendment to 2019 Advisory Agreement

On January 14, 2020, we amended the 2019 Advisory Agreement (as amended, the “2020 Advisory Agreement”), which was approved unanimously by our board of directors, including our independent directors.

The 2020 Advisory Agreement revised the calculation of the Base Management Fee, which was previously based on “Total Adjusted Common Equity” (as defined in the 2019 Advisory Agreement), with a calculation based on “Gross Tangible Real Estate,” effective beginning with the three months ending March 31, 2020.

The revised Base Management Fee will be payable quarterly in arrears and shall be calculated at an annual rate of 0.50% ( 0.125% per quarter) of the prior calendar quarter’s “Gross Tangible Real Estate,” defined in the 2020 Advisory Agreement as the gross cost of tangible real estate owned by us (including land and land improvements, irrigation and drainage systems, horticulture, 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.

All other terms of the 2019 Advisory Agreement, including the calculations of the other fees, remain unchanged in the 2020 Advisory Agreement.

GLADSTONE LAND CORPORATION

2 unchanged sentences

(In Thousands)

Subsequent Capitalized Additions

Location and Description of Property

Date Acquired

Land and Land Improvements

Buildings & Improvements

Land Improvements

Buildings & Improvements

Land and Land Improvements

Buildings & Improvements

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)

40 unchanged sentences

Fresno County, California:

Land, Improvements & Horticulture

Land, Improvements & Permanent plantings 4/5/2016 8,117 3,623 1,228 11,455 — 196 — 3,623 1,424 11,455 16,501 ( 2,401 )

Saint Lucie County, Florida:

7 unchanged sentences

Fresno County, California:

Land, Improvements & Horticulture

Land, Improvements & Permanent plantings 10/13/2016 3,501 2,937 139 3,452 — — — 2,937 139 3,452 6,528 ( 769 )

Baca County, Colorado:

5 unchanged sentences

Fresno County, California:

Land & Improvements & Horticulture

Land, Improvements & Permanent plantings 7/17/2017 7,110 5,048 777 7,818 2 1,364 — 5,050 2,141 7,818 15,009 ( 1,548 )

Santa Barbara County, California:

Land & Improvements & Horticulture

Land, Improvements & Permanent plantings 8/9/2017 3,225 4,559 577 397 ( 50 ) 148 1,494 4,509 724 1,891 7,124 ( 403 )

Okeechobee County, Florida:

1 unchanged sentence

Walla Walla County, Washington:

Land & Improvements & Horticulture

Land, Improvements & Permanent plantings 9/8/2017 4,860 5,286 401 3,739 — — — 5,286 401 3,739 9,426 ( 1,724 )

Fresno County, California:

Land & Improvements & Horticulture

Land, Improvements & Permanent plantings 12/15/2017 3,207 2,016 324 3,626 ( 1 ) — ( 3 ) 2,015 324 3,623 5,962 ( 1,092 )

Kern County, California:

2 unchanged sentences

Kings County, California:

Land & Improvements & Horticulture

Land, Improvements & Permanent plantings 9/13/2018 4,025 3,264 284 3,349 5 — 5 3,269 284 3,354 6,907 ( 237 )

Madera, California:

Land & Improvements & Horticulture

Land, Improvements & Permanent plantings 11/1/2018 13,385 12,305 1,718 9,015 13 2 9 12,318 1,720 9,024 23,062 ( 725 )

Hartley County, Texas:

Land & Improvements 11/20/2018 5,117 7,320 1,054 — 3 96 — 7,323 1,150 — 8,473 ( 145 )

Merced County, California:

Madera County, California:

18 unchanged sentences

Land & Improvements 10/7/2019 5,739 9,275 431 — 20 1 — 9,295 432 — 9,727 ( 100 )

Miscellaneous Investments

The aggregate cost for land, buildings, improvements and horticulture for federal income tax purposes is approximately $844.3 million .

The Company computes depreciation using the straight-line method over the shorter of the estimated useful life or 39 years for buildings and improvements, the shorter of the estimated useful life or 40 years for horticulture, 5 to 10 years for equipment and fixtures and the shorter of the useful life or the remaining lease term for tenant improvements.

Phillips County, Colorado:

Land & Improvements 1/15/2020 4,500 6,875 660 — — — — 6,875 660 — 7,535 ( 63 )

Kern County, California:

Land, Improvements & Permanent plantings 6/24/2020 8,500 12,521 1,325 370 — — — 12,521 1,325 370 14,216 —

Wicomico & Caroline County, Maryland, and Sussex County, Delaware:

Land & Improvements 8/31/2020 4,481 6,703 626 — — 36 — 6,703 662 — 7,365 ( 21 )

Fresno County, California:

Land & Improvements 9/3/2020 18,764 15,071 4,680 11,921 — 28 — 15,071 4,708 11,921 31,700 ( 278 )

Fresno County, California:

Land, Improvements & Permanent plantings 10/1/2020 18,817 7,128 9,206 15,242 33 — — 7,161 9,206 15,242 31,609 ( 283 )

Ventura County, California:

Land & Improvements 12/15/2020 12,450 19,215 1,264 — 50 — — 19,265 1,264 — 20,529 ( 5 )

Tulare County, California:

Land, Improvements & Permanent plantings 12/17/2020 22,319 26,952 6,420 28,152 77 — — 27,029 6,420 28,152 61,601 ( 110 )

San Joaquin County, California:

Land, Improvements, & Permanent plantings 12/24/2020 20,615 8,219 7,228 16,281 41 — — 8,260 7,228 16,281 31,769 ( 59 )

Whatcom County, Washington:

Land, Improvements, & Permanent plantings 12/24/2020 22,750 12,265 2,142 19,924 38 — — 12,303 2,142 19,924 34,369 ( 89 )

Tulare County, California:

Land, Improvements & Permanent plantings 12/31/2020 — 1,082 1,154 1,977 31 — — 1,113 1,154 1,977 4,244 —

Miscellaneous Investments Various 26,257 35,112 8,687 4,194 58 2,657 974 35,169 11,345 5,168 51,683 ( 4,187 )

$ 627,690 $ 706,070 $ 123,712 $ 198,513 $ 7,263 $ 55,975 $ 3,907 $ 713,332 $ 179,686 $ 202,420 $ 1,095,439 $ ( 49,236 )

(1) The aggregate cost for land, buildings, improvements and long-lived horticulture plantings for federal income tax purposes is approximately $ 1.1 billion.

(2) The Company computes depreciation using the straight-line method over the shorter of the estimated useful life or 39 years for buildings and improvements, the shorter of the estimated useful life or 40 years for permanent plantings, 5 to 10 years for equipment and fixtures and the shorter of the useful life or the remaining lease term for tenant improvements.

The following table reconciles the change in the balance of real estate during the years ended December 31, 2020 and 2019, respectively (dollars in thousands):

1 unchanged sentence

Acquisitions during the period 257,055 252,817

Improvements 11,129 11,434

Dispositions during period — —

7 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data