Investors from all over the world are taking a keen interest in grabbing a piece of Saskatchewan’s most under-appreciated real estate asset - farmland.
Ted Cawkwell, an agriculture specialist at Re/Max Saskatoon, said when investors think about investment properties, their minds typically turn to commercial leasing space but farmland offers a number of unique qualities.
“You don’t have to replace the roof, you don’t have a boiler break and you don’t have a leaky tap. It’s dirt,” he said.
Cawkwell did approximately $35 million in farmland deals in 2016 with clients from around the globe, including the U.S., South Africa, China and the Middle East. New Saskatchewan regulations in 2016 could have an affect on foreign investors, however.
Land is typically sold in 160-acre parcels and can range from as little as $100,000 to many millions of dollars.
Farmland values in Saskatchewan doubled between 2010 and 2014 but the province still has some of the cheapest farmland in the world, he said.
And these aren’t your great-grandfather’s farmers, either. With drones surveying fields for bugs and disease and bio-tech growing strategies maximizing crop returns, today’s farmers aren’t “wearing overalls and picking on banjos. There’s a little more to it than what folks in the cities believe,” Cawkwell said.
And bad weather that seems to hit farmers practically every year? That doesn’t impact the landowner, just the tenant, Cawkwell said.
“The tenant has a legal and contractual obligation to pay the landlord. Even if you had a bad year, you might delay on paying a supplier but the landlord is the first guy to get paid,” he said.