Florida Farmland and Cropland over the Millennia
Crops have been produced in Florida for thousands of years. Squashes and gourds were probably grown in the late Archaic period (3,000 to 1,000 B.C.), according to “The New History of Florida.” The book by the University Press of Florida adds that it was probably 750 A.D. or later before corn began to be cultivated by some of Florida’s pre-European inhabitants.
Florida today is one of the leading crop producers in the United States. The Sunshine State leads the nation in sugarcane production and comes in second behind only California in fresh market vegetable production.
Sugarcane, concentrated near Lake Okeechobee, was grown on 412,000 Florida acres in 2014 and had production value of $505 million in 2013, according to the National Agricultural Statistics Service (NASS). The lion’s share of sugarcane – 298,500 acres – is in Palm Beach County. Hendry and Glades counties had 66,000 acres and 24,100 acres of sugarcane, respectively.
Vegetables, berries and melons grown in numerous parts of rural Florida occupy 200,600 acres, topped by sweet corn (34,000 acres), tomatoes (33,000 acres) and potatoes (29,300 acres). Other Florida-grown produce includes bell peppers, blueberries, cabbage, cucumbers, snap beans, squash, strawberries and watermelons. The total production value of those crops was $1.55 billion in 2014, according to NASS. The highest production values were for tomatoes ($437 million), strawberries ($306 million) and bell peppers ($164 million).
Field crops – corn, cotton, cottonseed, hay, peanuts, pecans, soybeans and wheat – were grown on 679,000 acres in 2014 and had production value of $385 million. Hay took up the most land – 320,000 acres, followed by peanuts on 167,000 acres and cotton on 105,000 acres. Peanuts were tops in production value at $145 million; hay was second at $133 million.
OWNING AND VALUING CROPLAND
Some cropland buyers are targeting properties that can be leased to growers, according to SVN | Saunders Real Estate (SVNSRE) sales associate Ben Gibson. Gibson, writing in SVNSRE’s “Lay of the Land Market Report 2014,” stated that investors want properties “that can be leased to area growers for a 5 percent to 6 percent capitalization rate back to the investor.” He added, “Historically, the average rental rate for row crop farming in Florida does not generate enough rental income to provide this type of investor with a 5 percent to 6 percent return. It is becoming more common to observe negotiations or actual sales which involve 5- to 10-year ‘lease-back’ of a sale property by the seller.” The seller will continue farming the tract, providing the investor with a desired return.
Referring to tomato production in Central Florida, Gibson stated that lease rates higher than market averages are observed on farms with on-site packinghouses or cooler facilities. “Rates are site specific and can be heavily influenced by the farm’s location, soils, type of irrigation and quality of the irrigation water,” he added.
SVNSRE sales associate Kevin Brown, also reporting in the “Lay of the Land Market Report 2014,” addressed cropland values around Hastings, east of the St. Johns River in St. Johns, Putnam and Flagler counties: “Land uses and values here generally experience a small, but growing, measure of influence from the steadily increasing populations of the metro area along the nearby Atlantic coast, less than 15 miles away.”
Turning attention to Florida’s Panhandle, Brown wrote, “Desired land attributes for commercial farming operations are big, open, arable upland areas in shapes and sizes amenable to pivot circles, with water available for irrigation. Farms with consumptive use permits are bound to stay in good demand, we believe.” He added that the highest per-acre prices are paid for farms with the highest proportions of irrigated land. “Irrigated cropland is the most valuable of the common use types, and it is significantly higher-valued than dry land in this market,” he wrote. “It is increasingly common for farm sales in this area to include irrigation systems, something we didn’t often see until the last 2-3 years.”