GLADSTONE LAND : MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

All statements contained herein, other than historical facts, may constitute
"forward-looking statements" within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"). These statements may relate to, among other
things, future events or our future performance or financial condition. In some
cases, you can identify forward-looking statements by terminology such as "may,"
"might," "believe," "will," "provided," "anticipate," "future," "could,"
"growth," "plan," "intend," "expect," "should," "would," "if," "seek,"
"possible," "potential," "likely," or the negative of such terms or comparable
terminology. These forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our business, financial
condition, liquidity, results of operations, funds from operations or prospects
to be materially different from any future business, financial condition,
liquidity, results of operations, funds from operations or prospects expressed
or implied by such forward-looking statements. For further information about
these and other factors that could affect our future results, please see the
captions titled "Forward-Looking Statements" and "Risk Factors" in this report
and our Annual Report on Form 10-K for the year ended December 31, 2019 (the
"Form 10-K"). We caution readers not to place undue reliance on any such
forward-looking statements, which are made pursuant to the Private Securities
Litigation Reform Act of 1995 and, as such, speak only as of the date made. We
undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise,
after the date of this Quarterly Report on Form 10-Q (the "Quarterly Report"),
except as required by law.
All references to "we," "our," "us" and the "Company" in this Quarterly Report
mean Gladstone Land Corporation and its consolidated subsidiaries, except where
it is made clear that the term refers only to Gladstone Land Corporation.
OVERVIEW
General
We are an externally-managed, agricultural real estate investment trust ("REIT")
that is engaged in the business of owning and leasing farmland. We are not a
grower of crops, nor do we typically farm the properties we own. We currently
own 113 farms comprised of 87,860 acres located across 10 states in the U.S. We
also own several farm-related facilities, such as cooling facilities,
packinghouses, processing facilities, and various storage facilities.
We conduct substantially all of our activities through, and all of our
properties are held, directly or indirectly, by, Gladstone Land Limited
Partnership (the "Operating Partnership"). Gladstone Land Corporation controls
the sole general partner of the Operating Partnership and currently owns,
directly or indirectly, approximately 98.7% of the units of limited partnership
interest in the Operating Partnership ("OP Units"). In addition, we have elected
for Gladstone Land Advisers, Inc. ("Land Advisers"), a wholly-owned subsidiary
of ours, to be treated as a taxable REIT subsidiary ("TRS").
Gladstone Management Corporation (our "Adviser") manages our real estate
portfolio pursuant to an advisory agreement, and Gladstone Administration, LLC
(our "Administrator"), provides administrative services to us pursuant to an
administration agreement.  Our Adviser and our Administrator collectively employ
all of our personnel and directly pay their salaries, benefits, and general
expenses.
Impact of COVID-19 on our Business and Operations
The novel coronavirus ("COVID-19") pandemic continues to evolve and is currently
impacting most countries, communities, and markets. The extent to which the
COVID-19 pandemic may impact our business, financial condition, liquidity,
results of operations, or prospects will depend on numerous evolving factors
that are out of our control and that we are not able to predict at this time,
including, but not limited to: (i) the nature, duration, and scope of the
pandemic; (ii) governmental, business, and individuals' actions that have been
and continue to be taken in response to the pandemic; (iii) the impact on
economic activity from the pandemic (including the effect on market rental rates
and farmland values, if any) and actions taken in response; (iv) the effect on
our tenants and their farming operations, including any disruptions that would
impact their ability to make rental payments to us (including, but not limited
to, labor shortages and supply chain disruptions); and (v) the impact on credit
markets and our ability to continue to secure debt financing.
We do not believe that the ongoing COVID-19 pandemic has materially affected our
operations or those of our tenants at this point in time. While most of our
farmers have experienced increased sales volumes and higher-than-average prices
because the pandemic has led the public to stockpile food and other necessities,
we expect such volumes and prices to eventually return to normal in the near
future.

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As of the date of this filing, all of our tenants are current in their rental
payments to us, with the exception of one tenant who owes us an annual rental
installment of approximately $56,000, which payment was due in April. Based on
the tenant's seven-year credit history and reported sales volumes, we ultimately
expect full collection of this amount. In addition, we have not received any
requests from tenants seeking rent relief as a result of COVID-19. If we receive
rent relief requests in the future from tenants that have been materially and
adversely impacted by the ongoing COVID-19 pandemic, as assessed by us, in
exchange for granting any such relief, we intend to seek certain favorable lease
modification terms in exchange for granting such relief, if any, including, but
not limited to, extended lease terms, increased rent, and near-term rent
deferral repayments. In addition, if we were to grant any rent deferrals, we
anticipate that any such agreements would include partial payments in exchange
for rent deferrals of varying terms, with all deferred amounts to be paid back
to us over a specified, short-term period. At this time, we are unable to
quantify the success of any tenant's financial prospects, the amount of any
future relief requests from tenants, or the outcome of any future relief package
negotiations, if such relief is granted.
In addition, while public equity markets have experienced significant volatility
lately, we do not believe there will be a credit freeze in the near term that
will have a material adverse impact on us. Further, we are in compliance with
all of our debt covenants, and we believe we currently have adequate liquidity
to cover all near-term debt obligations and operating expenses.
We currently expect values of our farmland portfolio to remain stable, and we
expect rental payments to continue to be paid on time for at least the
foreseeable future. However, we will continue to monitor the overall situation
and our portfolio and may take actions that alter our business operations as may
be required by federal, state, or local authorities or that we determine are in
the best interests of our personnel, tenants, or stockholders. There can be no
assurance that our business and financial and operational results will not be
impacted by the COVID-19 pandemic or that we will be able to pay distributions
to our stockholders in the future at the same rate, or at all.
Portfolio Diversity
Since our initial public offering in January 2013 (the "IPO"), we have expanded
our portfolio from 12 farms leased to 7 different, unrelated tenants to a
current portfolio of 113 farms leased to 70 different, unrelated third-party
tenants who grow over 45 different types of crops on our farms. While our focus
remains in farmland suitable for growing fresh produce annual row crops, we have
also diversified our portfolio into farmland suitable for other crop types,
including permanent crops (e.g., almonds, blueberries, pistachios, and wine
grapes) and, to a lesser extent, certain commodity crops (e.g., beans and corn).
The acquisition of additional farms since our IPO has also allowed us to further
diversify our portfolio geographically. The following table summarizes the
different geographic locations (by state) of our farms owned and with leases in
place as of and for the three months ended March 31, 2020 and 2019 (dollars in
thousands):
                         As of and For the three months ended March 31, 2020              As of and For the three months ended March 31, 2019
                     Number                   % of                      % of Total    Number                     % of                    % of Total
                       of        Total       Total          Lease         Lease         of          Total        Total        Lease        Lease
    State            Farms       Acres       Acres         Revenue       Revenue       Farms        Acres        Acres       Revenue      Revenue
California(1)          42        14,830      16.9%      $     6,816       44.6%         33         10,147        13.7%      $  3,734       47.7%
Florida                23        20,770      23.6%            3,335       21.8%         22         17,184        23.2%         2,339       29.9%
Arizona                6         6,280        7.1%            3,331       21.8%          6          6,280        8.5%            539        6.9%
Colorado               12        32,773      37.3%              823        5.4%         10         31,448        42.6%           696        8.9%
Nebraska               8         7,104        8.1%              385        2.5%          3          3,254        4.4%             60        0.8%
Michigan               15         962         1.1%              170        1.1%          5           446         0.6%             21        0.2%
Oregon                 3          418         0.5%              130        0.9%          3           418         0.6%            128        1.6%
Washington             1          746         0.8%              123        0.8%          1           746         1.0%            122        1.5%
Texas                  1         3,667        4.2%              112        0.7%          1          3,667        5.0%            131        1.7%
North Carolina         2          310         0.4%               55        0.4%          2           310         0.4%             60        0.8%
TOTALS                113        87,860      100.0%     $    15,280       100.0%        86         73,900       100.0%      $  7,830       100.0%

(1) 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.

Leases

General

Most of our leases are on a triple-net basis, an arrangement under which, in
addition to rent, the tenant is required to pay the related taxes, insurance
costs, maintenance, and other operating costs. Our leases generally have
original terms ranging from 3 to 10 years for farms growing row crops and 7 to
15 years for farms growing permanent crops (in each case, often with options

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to extend the lease further). Rent is generally payable to us in advance on
either an annual or semi-annual basis, with such rent typically subject to
periodic escalation clauses included within the lease. Currently, 87 of our
farms are leased on a pure, triple-net basis and 26 farms are leased on a
partial-net basis (with us, as landlord, responsible for all or a portion of the
related property taxes). Certain of our leases had been on a single-net basis,
with us, as landlord, responsible for the related property taxes, as well as
certain maintenance, repairs, and insurance costs. Additionally, 29 of our farms
are leased under agreements that include a participation rent component based on
the gross revenues earned on the respective farms.
Lease Expirations
Agricultural leases are often shorter term in nature (relative to leases of
other types of real estate assets), so in any given year, we may have multiple
leases up for extension or renewal. The following table summarizes the lease
expirations by year for the farms owned and with leases in place as of March 31,
2020 (dollars in thousands):
             Number of      Expiring                 Lease Revenues for the     % of Total
             Expiring        Leased    % of Total      Three Months Ended         Lease
   Year      Leases(1)      Acreage     Acreage          March 31, 2020          Revenues
2020             5     (2)   24,830      28.3%      $                    842       5.5%
2021            10           8,849       10.1%                           649       4.2%
2022             3            330         0.4%                           191       1.3%
2023             9           6,179        7.0%                         1,467       9.6%
2024             5           6,243        7.1%                           571       3.7%
Thereafter      42           41,429      47.1%                         8,723      57.1%
Other(3)         7             -           -%                          2,837      18.6%
Totals          81           87,860      100.0%     $                 15,280      100.0%


(1)  Certain lease agreements encompass multiple farms.

(2) Includes one lease that was renewed for eight years subsequent to March 31,

2020 (see "Recent Developments-Portfolio Activity-Existing

Properties-Leasing Activity" below for a summary of this and other recent

     leasing activities).


(3)  Consists of ancillary leases (e.g., oil, gas, and mineral leases,

telecommunications leases, etc.) with varying expirations on certain of our

farms. In addition, includes a net amount of approximately $2.8 million of

lease revenue recorded as a result of an early lease termination on one of

     our properties (see below, under "Recent Developments-Portfolio
     Activity-Existing Properties-Leasing Activity-Lease Termination" for
     additional information).


We currently have one agricultural lease (on a farm in California) scheduled to
expire within the next six months. We are currently in negotiations with the
existing tenant on the farm, as well as other potential tenants, and we
anticipate being able to renew the lease at its current market rental rate
without incurring any downtime on the farm. We currently anticipate the lease
renewal on this farm to be at a rental rate that is equal to or slightly higher
than that of the current lease. Regarding all upcoming lease expirations, there
can be no assurance that we will be able to renew the existing leases or execute
new leases at rental rates favorable to us, if at all, or be able to find
replacement tenants, if necessary.
Recent Developments
Portfolio Activity
Property Acquisitions
Since January 1, 2020, through the date of this filing, we have acquired two
farms, which are summarized in the table below (dollars in thousands, except for
footnotes):
                                                                     Primary                                 Total                            Annualized
   Property        Property     Acquisition    Total    No. of       Crop(s)          Lease     Renewal     Purchase       Acquisition       Straight-line
     Name          Location        Date       Acreage   Farms         / Use           Term      Options      Price          Costs(1)            Rent(2)
                                                                   Sugar beets,
County Road 18   Phillips, CO    1/15/2020     1,325      2       edible beans,     6.0 years    None     $    7,500     $          39     $           417
                                                                 potatoes, & corn
                                               1,325      2                                               $    7,500     $          39     $           417


(1)  Includes approximately $4,000 of external legal fees associated with

negotiating and originating the lease associated with this acquisition,

which cost was expensed in the period incurred.

(2) Annualized straight-line rent is based on the minimum cash rental payments

guaranteed under the applicable leases, as required under GAAP, and excludes

contingent rental payments, such as participation rents.

Existing Properties
Leasing Activity

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The following table summarizes certain leasing activity that has occurred on our existing properties since January 1, 2020, through the date of this filing (dollars in thousands, except for footnotes):

                                                     PRIOR LEASES                                         NEW LEASES(1)
                                           Total        # of Leases     Lease               Total                  # of Leases     Lease
               Number  Total            Annualized         with       Structures         Annualized     Wtd. Avg.     with       Structures
     Farm        of     Farm           Straight-line   Participation  (# of

NNN Straight-line Term Participation (# of NNN

  Locations    Leases  Acres              Rent(2)          Rents     / NN / N)(3)          Rent(2)       (Years)      Rents     / NN / N)(3)
 AZ, CA, & NE    11    6,829         $         5,267         3        7 / 2 / 2       $         5,450      6.2          4        7 / 4 / 0

(1) 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," within the accompanying notes to our
     condensed consolidated financial statements for additional information on
     these commitments.

(2) 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.

(3) "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, in each case, as described above under

"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 we recognized as additional lease revenue
during the three months ended 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). In connection with the early termination of these leases,
during the three months ended March 31, 2020, we recognized approximately
$89,000 of prepaid rent as additional lease revenue and wrote off an aggregate
net deferred rent balance of approximately $254,000 against lease revenue. In
addition, approximately $470,000 of unamortized lease intangible assets related
to the terminated leases were written off and charged to amortization expense
during the three months ended March 31, 2020. 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.
Property Add-on
In connection with the acquisition of a 366-acre vineyard located in Napa,
California, on August 28, 2019 ("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. Approval of the additional
plantings was not received from the County of Napa by the Permit Deadline, and,
as such, we were relieved of our obligation to remit any additional
compensation. However, 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 approved additional vineyard plantings on 38.7 acres on the property. As
such, we will be required to pay additional compensation related to this
acquisition of approximately $3.2 million, which will be paid during the three
months ending June 30, 2020. As provided for in the lease, we will earn
additional rent on all of the aforementioned costs as they are incurred by us.
Financing Activity
Debt Activity
Since January 1, 2020, through the date of this filing, we have incurred the
following new, long-term borrowings (dollars in thousands, except for footnotes;
for further discussion on certain defined terms used below, refer to Note 4,
"Borrowings," within the accompanying notes to our condensed consolidated
financial statements):
                                                                                                   Stated
                                         Date of      Principal     Maturity       Principal      Interest     Interest
   Lender                               Issuance       Amount         Date       Amortization       Rate      Rate Terms
                                                                                     None                    Fixed
Farmer Mac(1)                           1/10/2020   $     8,100

1/12/2024   (interest only)    2.66%     throughout
                                                                                                             term

(1) Represents an amendment to a bond that was previously issued under the

Farmer Mac Facility.

New MetLife Facility
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

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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 (the "New MetLife
Facility"). For information on the pertinent terms of the issuances under the
New MetLife Facility, refer to Note 4, "Borrowings-New MetLife Facility," within
the accompanying notes to our condensed consolidated financial statements.
Farm Credit Notes Payable-Interest Patronage
From time to time since September 2014, we, through certain subsidiaries of our
Operating Partnership, have entered into various loan agreements (collectively,
the "Farm Credit Notes Payable") with 10 different Farm Credit associations
(collectively, "Farm Credit"). 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. For further discussion on interest patronage,
refer to Note 4, "Borrowings-Farm Credit Notes Payable," in the accompanying
notes to our condensed consolidated financial statements.
Equity Activity
Series B Preferred Stock
On May 31, 2018, we filed a prospectus supplement with the U.S. Securities and
Exchange Commission (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. The Series B Preferred Stock was offered on a continuous,
"reasonable best efforts" basis by Gladstone Securities, LLC ("Gladstone
Securities"), an affiliate of ours and the dealer-manager for the Series B
Offering. See Note 6, "Related-Party Transactions-Gladstone Securities-Series B
Dealer-Manager Agreement," within the accompanying notes to our condensed
consolidated financial statements for more details on the Series B
Dealer-Manager Agreement.
The following table summarizes the sales of our Series B Preferred Stock that
occurred since January 1, 2020, through the date of this filing (dollars in
thousands, except per-share amounts and footnotes):
                            Weighted-average
Number of Shares Sold    Sales Price per Share      Gross Proceeds     Net Proceeds(1)
      1,229,531         $                 24.52    $        30,148    $          27,664

(1) Net of selling commissions and dealer-manager fees borne by us. Aggregate

selling commissions and dealer-manager fees paid to Gladstone Securities as

a result of these sales was approximately $2.5 million (of which

approximately $2.3 million was remitted by Gladstone Securities to unrelated

third-parties involved in the offering, such as participating broker-dealers

and wholesalers).

In addition, since January 1, 2020, through the date of this filing, 8,153
shares of the Series B Preferred Stock were tendered for redemption at a
weighted-average cash redemption price of $23.85 per share. As a result, we paid
total redemption costs of approximately $194,000 to redeem and retire these
shares.
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 selling commissions, dealer-manager fees, and
offering expenses payable by us, of approximately $133.5 million. During the
course of the Series B Offering, we paid aggregate selling commissions and
dealer-manager fees to Gladstone Securities of approximately $12.5 million, of
which approximately $11.7 million, or 93.7%, were remitted by Gladstone
Securities to unrelated third-parties involved in the offering, including
participating broker-dealers and wholesalers. Excluding selling commissions and
dealer-manager fees paid to Gladstone Securities, we incurred approximately $1.5
million of total costs related to the Series B Offering.
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 Series B
Termination Date, though there can be no assurance that a listing will be
achieved in such timeframe, or at all.
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 (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

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of our Series C Preferred Stock pursuant to our dividend reinvestment plan (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 (the "Series C Prospectus
Supplement") with the SEC for a continuous public offering (the "Series C
Offering") of up to 26,000,000 shares of our Series C Preferred Stock, which
superseded and replaced the prospectus supplement dated February 20, 2020. Under
the Series C Prospectus Supplement, we may sell up to 20,000,000 shares of our
Series C Preferred Stock on a "reasonable best efforts" basis through Gladstone
Securities at an offering price of $25.00 per share (the "Primary Series C
Offering") and up to 6,000,000 additional shares of our Series C Preferred Stock
pursuant to the DRIP to those holders of the Series C Preferred Stock who do not
elect to opt-out of such plan.
Assuming all shares of the Series C Preferred Stock are sold in both the Primary
Series C Offering and through the DRIP, we expect the Series C Offering to
result in gross proceeds of up to $636.5 million and net proceeds, after
deducting selling commissions, dealer-manager fees, and estimated expenses of
the offering payable by us, of up to approximately $591.5 million. We intend to
use the net proceeds from the Series C Offering to repay existing indebtedness,
to fund future acquisitions, and for other general corporate purposes.
See Note 6, "Related-Party Transactions-Gladstone Securities-Series C
Dealer-Manager Agreement," within the accompanying notes to our condensed
consolidated financial statements for more details on the dealer-manager
agreement entered into with Gladstone Securities in connection with the Series C
Offering.
The following table summarizes the sales of our Series C Preferred Stock that
occurred since January 1, 2020, through the date of this filing (dollars in
thousands, except per-share amounts and footnotes):
 Number of        Weighted-average
Shares Sold    Sales Price per Share      Gross Proceeds      Net Proceeds(1)
  15,600      $                 25.00    $            390    $             355

(1) Net of selling commissions and dealer-manager fees borne by us. Aggregate

selling commissions and dealer-manager fees paid to Gladstone Securities as

a result of these sales was approximately $35,000 (of which approximately

$34,000 was remitted by Gladstone Securities to unrelated third-parties

involved in the offering, such as participating broker-dealers and

wholesalers).

The Primary 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.
Common Stock
At-the-Market Program
On August 7, 2015, we entered into equity distribution 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 summarizes the activity under the ATM Program from January
1, 2020, through the date of this filing (dollars in thousands):
 Number of         Weighted-average
Shares Sold    Offering Price per Share     Gross Proceeds      Net Proceeds(1)
  409,800     $                   13.28    $          5,441    $           5,386

(1) Net of underwriter commissions and discounts.

LIBOR Transition
The majority of our debt is at fixed rates, and we currently have very limited
exposure to variable-rate debt based upon the London Interbank Offered Rate
("LIBOR"), which is anticipated to be phased out during late 2021. LIBOR is
currently expected to transition to a new standard rate, the Secured Overnight
Financing Rate ("SOFR"), which will incorporate certain overnight repo market
data collected from multiple data sets. The current intent is to adjust the SOFR
to minimize the differences between the interest that a borrower would be paying
using LIBOR versus what it will be paying SOFR. We are currently monitoring the
transition and cannot yet assess whether SOFR will become a standard rate for
variable-rate debt. However, as our lines of credit with MetLife are currently
based upon one-month LIBOR, we expect we will need to renegotiate this agreement
in the future. Assuming that SOFR replaces LIBOR and is appropriately adjusted,
we expect the transition to result in a minimal impact to our overall
operations.

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Our Adviser and Administrator
We are externally managed pursuant to contractual arrangements with our Adviser
and our Administrator (both affiliates of ours), which collectively employ all
of our personnel and pay their salaries, benefits, and general expenses
directly. The investment advisory agreement with our Adviser that was in effect
through March 31, 2017, and the current administration agreement with our
Administrator (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.
A summary of the 2019 Advisory Agreement is provided in Note 6 to our
consolidated financial statements included in our Form 10-K. A summary of the
compensation terms for each of the Prior Advisory Agreement, the 2020 Advisory
Agreement, and the Administration Agreement is below.
Advisory Agreements
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 (in each case, as
further described below), while all other fees remained unchanged. The base
management and incentive fees are described below. For information on the
capital gains and termination fees, refer to Note 6, "Related-Party
Transactions-Our Adviser and Administrator-Advisory Agreements," within the
accompanying notes to our condensed consolidated financial statements.
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
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 2020 Advisory Agreement, a base management fee is paid quarterly and
is calculated at an annual rate of 0.50% (0.125% 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, 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.
Relevant to prior agreements with our Adviser, which calculated the management
fee based on an equity component, management believes the updated fee
calculation pursuant to the 2020 Advisory Agreement provides for a more direct
correlation between the fee paid to our Adviser and the assets our Adviser is
responsible for managing. The following table compares what the historical base
management fee has been on an actual basis for the years ended December 31,
2019, 2018, and 2017, versus what it would have been had the 2020 Advisory
Agreement been in place during each of those years (dollars in thousands):
                                                            For the Years 

Ended December 31,

                                                           2019             2018           2017
Actual gross base management fee(1)                    $    3,623       $    2,837      $  2,041
Hypothetical gross base management
fee(2)                                                      3,150            2,433         2,010
Hypothetical increase (decrease) in
base management fee                                    $     (473 )     $   

(404 ) $ (31 )

(1)  Actual figures calculated pursuant to the agreements with our Adviser in
     place during the respective periods.

(2) Calculated as if the 2020 Advisory Agreement had been in place as of January

1, 2017.

In addition, had the 2019 Advisory Agreement been in place during the three
months ended March 31, 2020, the hypothetical base management fee would have
been approximately $867,000, as compared to the actual base management fee
calculated under the 2020 Advisory Agreement of approximately $1.0 million. We
are unable to project the impact of the 2020 Advisory Agreement on the base
management fee going forward and how it might compare to that of the 2019
Advisory Agreement or

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the Prior Advisory Agreement, as we are unable to estimate the amount of equity
to be issued or new tangible assets to be acquired in future periods.
During the three months ended March 31, 2019, our Adviser granted us certain
non-contractual, unconditional, and irrevocable waivers (as discussed further
below, under "-Results of Operations-Operating Expenses-Related-Party Fees"),
which were applied as credits against the base management fee for the period. We
did not have any such waivers for the three months ended March 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 2020 Advisory Agreement, an incentive fee is calculated and payable
quarterly in arrears if the Pre-Incentive Fee FFO for a particular quarter
exceeds a hurdle rate of 1.75% (7.0% annualized) of the prior calendar quarter's
"Total Adjusted Common Equity," 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.
For purposes of the calculation of the Incentive Fee, Pre-Incentive Fee 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. Our Adviser would receive: (i) no
Incentive Fee in any calendar quarter in which the Pre-Incentive Fee FFO did not
exceed the hurdle rate; (ii) 100% of the Pre-Incentive Fee FFO with respect to
that portion of such Pre-Incentive Fee FFO, if any, that exceeded the hurdle
rate but was less than 2.1875% in any calendar quarter (8.75% annualized); and
(iii) 20% of the amount of the Pre-Incentive Fee FFO, if any, that
exceeds 2.1875% in any calendar quarter (8.75% annualized).
Critical Accounting Policies
The preparation of our financial statements in accordance with U.S. generally
accepted accounting principles ("GAAP") requires management to make judgments
that are subjective in nature to make certain estimates and assumptions.
Application of these accounting policies involves the exercise of judgment
regarding the use of assumptions as to future uncertainties, and, as a result,
actual results could materially differ from these estimates. A summary of our
significant accounting policies is provided in Note 2 to our consolidated
financial statements in our Form 10-K. There were no material changes to our
critical accounting policies during the three months ended March 31, 2020.
Smaller Reporting Company Status
We currently qualify as a "smaller reporting company" under Rule 12b-2 of the
Exchange Act, which is defined as a company with a public equity float of less
than $250 million or less than $100 million in annual revenues for the previous
year and no public float. Companies can also qualify as a smaller reporting
company if they have annual revenues of less than $100 million for the previous
year and a public float of less than $700 million. As a smaller reporting
company, we have reduced disclosure requirements for our public filings,
including the reduced disclosure obligations regarding executive compensation in
our periodic reports and proxy statements.
Investment Objectives and Strategy
Our principal business objective is to maximize stockholder returns through a
combination of: (i) monthly cash distributions to our stockholders, which we
hope to sustain and increase through long-term growth in cash flows from
increased rents; (ii) appreciation of our land; and (iii) capital gains derived
from the sale of our properties. Our primary strategy to achieve our business
objective is to invest in and further diversify our current portfolio of
primarily triple-net leased farmland and farm-related properties. In addition,
we may also acquire certain commercial properties used by businesses that
support agricultural communities, including those businesses that obtain
financing under the U.S. Farm Credit System. This strategy includes the
following components:
•      Owning Farms, Farm-Related Real Estate, and Real Estate for Businesses

that Support Farming Communities for Income. We own and intend to

primarily acquire additional farms and farm-related properties and lease

them to independent and corporate farming operations, including sellers

who desire to continue farming the land after we acquire the property from

       them. We may also acquire commercial properties used by businesses that
       support farming communities, including those businesses that obtain
       financing under the U.S. Farm Credit System. Such business may



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include, but are not limited to, farmer-owned cooperatives, rural infrastructure
providers, and other agribusinesses. We intend to hold most acquired properties
for many years and to generate stable and increasing rental income from leasing
these properties.
•      Owning Farms, Farm-Related Real Estate, and Real Estate for Businesses

that Support Farming Communities for Appreciation. We intend to lease

acquired properties over the long term. However, from time to time, we may

sell one or more properties if we believe it to be in the best interests

of our stockholders and best to maintain the overall value of our

portfolio. Potential purchasers may include real estate developers

desiring to develop the property, financial purchasers seeking to acquire

property for investment purposes, or farmers who have operated or seek to

operate the land. Accordingly, we will seek to acquire properties that we

       believe have potential for long-term appreciation in value.


•      Continue Expanding our Operations Geographically.  Our properties are

currently located in 10 states across the U.S., and we expect that we will

acquire properties in other farming regions of the U.S. in the future.

While our primary regions of focus are the Pacific West and the

Southeastern regions of the U.S., we believe other regions of the U.S.,

such as the Northwest and Mid-Atlantic regions, offer attractive locations

for expansion, and, to a lesser extent, we also expect to seek farmland

acquisitions in certain regions of the Midwest, as well as other areas in

the U.S.

• Continue Expanding our Crop Varieties. Currently, the majority of tenants

who farm our properties grow annual row crops dedicated to fresh produce,

such as berries (e.g., strawberries and raspberries) and fresh vegetables

(e.g., tomatoes, lettuce, and bell peppers). We have also expanded further

into certain permanent crops (e.g., almonds, pistachios, blueberries, and

wine grapes) and, to a lesser extent, commodity crops (e.g., corn and

beans). We will seek to continue our recent expansion into other permanent

       crops and, to a lesser extent, commodity crops, while maintaining our
       focus on annual row-crop farms growing fresh produce.

• High Leverage. To maximize our number of investments, we intend to borrow

through loans secured by long-term mortgages on our properties, and we may

       also borrow funds on a short-term basis or incur other indebtedness.


•      Owning Mortgages on Farms and Farm-Related Real Estate. In certain
       circumstances, we may make senior secured, first-lien mortgage loans

(secured by farms or farm-related real estate) to farmers for the purchase

of farmland, properties related to farming, and for other farm-related

needs. We do not expect that, over time, our mortgages held will exceed

5.0% of the fair value of our total assets.

We intend to acquire more farmland and farm-related properties in our regions of
focus that is already or will be leased to farmers, and we expect that most of
our future tenants will be independent or corporate farming and business
operations that are all unrelated to us. We intend to continue to lease the
majority of our farms and farm-related facilities on a triple-net lease basis to
tenants who sell their products through national corporate
marketers-distributors. We may also acquire and lease commercial properties used
by businesses that support farming communities. We expect to continue to earn
rental income from our farmland investments and businesses that support farming
communities.
Our Investment Process
Types of Investments
We expect that substantially all of our investments will continue to be
comprised of income-producing agricultural real property, and we expect that the
majority of our leases will continue to be structured as triple-net leases. We
may also acquire properties used by businesses that support farming communities.
Investments will not be restricted as to geographical areas, but we expect that
most of our investments will continue to be made within the continental U.S.
Currently, our properties are located across 10 states in the U.S. We anticipate
that we will make substantially all of our investments through our Operating
Partnership. Our Operating Partnership may acquire interests in real property in
exchange for the issuance of shares of our common stock, OP Units, cash, or
through a combination of the three. OP Units issued by our Operating Partnership
will be redeemable at the option of the holder for cash or, at our election,
shares of our common stock on a one-for-one basis at any time after holding the
OP Units for one year. We currently, and may in the future, hold some or all of
our interests in real properties through one or more wholly-owned subsidiaries,
each classified as a qualified REIT subsidiary.
Property Acquisitions and Leasing
We anticipate that many of the farms and farm-related facilities we purchase
will be acquired from independent farmers or agricultural companies and that
they will simultaneously lease the properties back from us. These transactions
will provide the tenants with an alternative to other financing sources, such as
borrowing, mortgaging real property, or selling securities. We anticipate that
some of our transactions will be in conjunction with acquisitions,
recapitalizations, or other corporate transactions affecting our tenants. We
also expect that many of the farms and farm-related facilities we acquire will
be purchased from owners that do not farm the property but rather lease the
property to tenant-farmers. In situations such as these, we intend to have a
lease in place prior to or simultaneously with acquiring the property.

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We intend to own and lease primarily single-tenant, agricultural real property,
and we may acquire and lease properties used by businesses that support farming
communities. Generally, we will lease properties to tenants that our Adviser
deems creditworthy under triple-net leases that will be full-recourse
obligations of our tenants or their affiliates. Most of our agricultural leases
have original terms ranging from 3 to 10 years for farms growing annual row
crops and 7 to 15 years for properties growing permanent crops, often with
options to extend the lease further. Rent is generally payable to us in advance
on either an annual or semi-annual basis, with such rent typically subject to
periodic escalation clauses provided for within the lease. The escalation
clauses may specify fixed dollar amounts or percentage increases each year, or
they may be variable, based on standard cost of living or inflation indices. In
addition, some leases that are longer-term in nature may require a regular
survey of comparable land rents, with the rent owed per the lease being adjusted
to reflect then-current market rents. We also have leases that include a
variable rent component based on the gross revenues earned on the respective
farm. In these types of agreements, we will generally require the lease to
include the guarantee of a minimum amount of rental income that satisfies our
investment return criteria.
We believe that we can acquire farmland that we will be able to lease at annual
rental rates providing net capitalization rates ranging from 5% to 7% or more of
the properties' market values. However, there can be no assurance that we will
be able to achieve this level of rental rates. Since rental contracts in the
farming business for annual row crops are customarily short-term agreements,
rental rates are typically renegotiated regularly to then-current market rates.
Underwriting Criteria and Due Diligence Process
Selecting the Property
We consider selecting the right properties to purchase or finance as the most
important aspect of our business. Buying quality farmland that can be used to
grow a variety of different crops and that is located in desirable locations is
essential to our success.
Our Adviser works with real estate contacts in agricultural markets throughout
the U.S. to assess available properties and farming areas. We believe that our
Adviser is experienced in selecting valuable farmland and will use this
expertise to identify promising properties. The following is a list of important
factors in our selection of farmland:
•      Water Availability. Availability of water is essential to farming. We seek

to purchase properties with ample access to water through an operating

well on site or rights to use a well or other source that is located

nearby. Additionally, we may, in the future, consider acquiring properties

that rely on rainfall for water if the tenant on that property mitigates

the drought risk by purchasing drought insurance. Typically, leases on

properties that would rely on rainfall would be longer term in nature.

•      Soil Composition. In addition to water, for farming efforts to be
       successful, the soil must be suitable for growing crops. We will not buy
       or finance any real property that does not have soil conditions that we

believe are favorable for growing the crops farmed on the property, except

to the extent that a portion of an otherwise suitable property, while not

favorable for growing the crops farmed on the property, may be utilized to

build structures used in the farming business, such as cooling facilities,

packinghouses, distribution centers, greenhouses, and storage facilities.

• Location. Farming also requires optimal climate and growing seasons. We

typically seek to purchase properties in locations that take advantage of

       climate conditions that are needed to grow fresh produce row crops. We
       intend to continue to expand throughout the U.S. in locations with
       productive farmland and financially sound tenant-farmers.

• Price. We intend to purchase and finance properties that we believe are a

       good value and that we will be able to rent profitably for farming over
       the long term. Generally, the closer a property is located to urban
       developments, the higher the value of the property. As a result,
       properties that are currently located in close proximity to urban
       developments are likely to be too expensive to justify farming over an

extended period of time, and, therefore, we are unlikely to invest in such

properties.

Our Adviser will perform a due diligence review with respect to each potential
property acquisition. Such review will include an evaluation of the physical
condition of a property and an environmental site assessment to determine
potential environmental liabilities associated with a property prior to its
acquisition. One of the criteria that we look for is whether mineral rights to
such property, which constitute a separate estate from the surface rights to the
property, have been sold to a third party. We generally seek to invest in
properties where mineral rights have not been sold to third parties; however, in
cases where access to mineral rights would not affect the surface farming
operations, we may enter into a lease agreement for the extraction of minerals
or other subterranean resources, as we have done in the past on a few of our
properties. We may seek to acquire mineral rights in connection with the
acquisition of future properties to the extent such mineral rights have been
sold off and the investment acquisition of such rights is considered to be
favorable after our due diligence review. Despite the conduct of these reviews,
there can be no assurance that hazardous substances or waste, as determined
under present or future federal or state laws or regulations, will not be
discovered on the property after we acquire it.
Our Adviser will also physically inspect each property and the real estate
surrounding it to estimate its value. Our Adviser's

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due diligence will be primarily focused on valuing each property independent of
its rental value to particular tenants to whom we plan to rent. The real estate
valuations our Adviser performs will consider one or more of the following
items:
•      The comparable value of similar real property in the same general area of

the prospective property, to the extent possible.

• The comparable real estate rental rates for similar properties in the same

general area of the prospective property.

• Alternative uses for the property to determine if there is another use for

the property that would give it higher value, including potential future

conversion to urban or suburban uses, such as commercial or residential

development.

• The assessed value as determined by the local real estate taxing authority.

In addition, our Adviser will generally supplement its valuation estimate with
an independent real estate appraisal in connection with each investment that it
considers. These appraisals may take into consideration, among other things, the
terms and conditions of the particular lease transaction, the quality of the
tenant's credit, and the conditions of the credit markets at the time the lease
transaction is negotiated. However, in certain limited situations, the actual
purchase price of a property may be greater or less than its appraised value.
When appropriate, our Adviser may engage experts to undertake some or all of the
due diligence efforts described above.
Upon completion of a due diligence investigation and a decision to proceed with
an investment, the Adviser's investment professionals who have primary
responsibility for the investment present the investment opportunity to the
Adviser's investment committee. The investment committee then determines whether
to pursue the potential investment. Prior to the closing of an investment,
additional due diligence may be conducted on our behalf by attorneys,
independent accountants, and other outside advisers, as appropriate.
Underwriting the Tenant, Due Diligence Process, and Negotiating Lease Provisions
In addition to property selection, underwriting the tenant that will lease the
property is also an important aspect of our investment process. Our Adviser will
evaluate the creditworthiness of the tenant and assess its ability to generate
sufficient cash flow from its agricultural operations, and other business
operations as applicable, to cover its payment obligations to us pursuant to our
lease. The following is a list of criteria that our Adviser may consider when
evaluating potential tenants for our properties, although not all criteria may
be present for each lease:
•      Experience. We believe that experience is the most significant

characteristic when determining the creditworthiness of a tenant.

Therefore, we seek to rent our properties to farmers that have an

extensive track record of farming their property and particular crops

       successfully and, in some cases, to other tenants with meaningful
       management experience and a strong operating history.


•      Financial Strength. We evaluate each potential tenant's financial

stability, considering factors such as its rating by a national credit

rating agency, if any, management experience, industry position and

fundamentals, operating history, and capital structure, as applicable. We

primarily seek to rent to farming operations that have financial resources

to invest in planting and harvesting their crops. We generally require

       annual financial statements of new tenants to evaluate the financial
       capability of the tenant and its ability to perform its obligations under
       the lease.

• Adherence to Quality Standards. We seek to lease our properties to those

farmers that are committed to farming in a manner that will generate

high-quality crops. We intend to identify such commitment through their

track records of selling produce into established distribution chains and

       outlets.


•      Lease Provisions that Enhance and Protect Value. When appropriate, our

Adviser attempts to include lease provisions that require our consent to

specified tenant activity or require the tenant to satisfy specific

operating tests. These provisions may include, for example, requiring the

tenant to meet operational or financial covenants or to indemnify us

against environmental and other contingent liabilities. We believe that

these provisions serve to protect our investments from adverse changes in

the operating and financial characteristics of a tenant that may impact

its ability to satisfy its obligations to us or that could reduce the

value of our properties. Our Adviser generally also seeks covenants

requiring tenants to receive our consent prior to any change in control of

the tenant.

• Credit Enhancement. To mitigate risk and enhance the likelihood of tenants

       satisfying their lease obligations, our Adviser may also seek
       cross-default provisions if a tenant has multiple obligations to us or
       seek a letter of credit or a guaranty of lease obligations from each
       tenant's corporate affiliates, if any. We believe that these types of

credit enhancements, if obtained, provide us with additional financial

security.

• Diversification. Our Adviser will seek to diversify our portfolio to avoid

dependence on any one particular tenant, geographic location, facility

type, or crop type. By diversifying our portfolio, our Adviser intends to

reduce the adverse effect on our portfolio of a single underperforming

investment or a downturn in any particular geographic region. Many of the

areas in which we purchase or finance properties are likely to have their

own microclimates and, although they appear to be in close proximity to

one another, generally will not be similarly affected by weather or other

       natural occurrences at the same time. We currently own properties in 10
       different states across the U.S., and



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over time, we expect to expand our geographic focus to other areas of the
Southeast, Pacific Northwest, Midwest, and Mid-Atlantic. We will also attempt to
continue diversifying our portfolio of properties by seeking additional farmland
that grows permanent crops and commodity crops, while maintaining our current
focus of owning and leasing farmland that grows fresh produce annual row crops.
While our Adviser seeks tenants it believes to be creditworthy, tenants are not
required to meet any minimum rating established by an independent credit rating
agency. Our Adviser's standards for determining whether a particular tenant is
creditworthy will vary in accordance with a variety of factors relating to
specific prospective tenants. The creditworthiness of a tenant is determined on
a tenant-by-tenant and case-by-case basis. Therefore, general standards for
creditworthiness cannot be applied. We monitor our tenants' credit quality on an
ongoing basis by, among other things, periodically conducting site visits to the
properties to ensure farming operations are taking place and to assess the
general maintenance of the properties.
RESULTS OF OPERATIONS
For the purposes of the following discussions on certain operating revenues and
expenses with regard to the comparison between the three months ended March 31,
2020 versus 2019:
•      Same-property basis represents farms owned as of December 31, 2018, and

were not vacant at any point during either period presented;

• Properties acquired or disposed of are farms that were either acquired or

disposed of at any point subsequent to December 31, 2018. From January 1,

       2019, through March 31, 2020, we acquired 28 new farms and did not have
       any farm dispositions; and

• Vacant or self-operated properties represent farms that were either vacant

(either wholly or partially) at any point during either period presented

       or operated by a wholly-owned subsidiary of ours. We had two farms that
       were vacant for a portion of the three months ended March 31, 2019.



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A comparison of our operating results for the three months ended March 31, 2020 and 2019 is below (dollars in thousands):

                                            For the Three Months Ended 

March 31,

                                                 2020                     2019           $ Change     % Change
Operating revenues:
Lease revenues:
Fixed lease payments                    $           12,262         $          7,773     $   4,489      57.8%
Variable lease payments - participation
rents                                                   30                       27             3      11.1%
Variable lease payments - tenant
reimbursements                                         178                       30           148      493.3%
Lease termination income, net                        2,810                        -         2,810        NM
Total operating revenues                            15,280                    7,830         7,450      95.1%
Operating expenses:
Depreciation and amortization                        4,257                    2,597         1,660      63.9%
Property operating expenses                            521                      816          (295 )   (36.2)%
Base management and incentive fees, net
of credits                                           2,368                      336         2,032      604.8%
Administration fee                                     384                      306            78      25.5%
General and administrative expenses                    553                      550             3       0.5%
Total operating expenses, net of
credits                                              8,083                    4,605         3,478      75.5%
Operating income                                     7,197                    3,225         3,972      123.2%
Other income (expense):
Other income                                         1,324                      826           498      60.3%
Interest expense                                    (4,963 )                 (3,453 )      (1,510 )    43.7%
Dividends declared on Series A Term
Preferred Stock                                       (458 )                   (458 )           -        -%
Loss on dispositions of real estate
assets, net                                            (99 )                    (32 )         (67 )    209.4%
Property and casualty recovery, net                     66                        -            66        NM
Income from investments in
unconsolidated entities                                 34                        -            34        NM
Total other expense, net                            (4,096 )                 (3,117 )        (979 )    31.4%
Net income                                           3,101                      108         2,993     2,771.3%
Net income attributable to
non-controlling interests                              (42 )                     (3 )         (39 )   1,300.0%
Net income attributable to the Company               3,059                      105         2,954     2,813.3%
Dividends declared on Series B
Preferred Stock                                     (2,125 )                   (601 )      (1,524 )    253.6%
Net income (loss) attributable to
common stockholders                     $              934         $           (496 )   $   1,430        NM


NM = Not Meaningful
Operating Revenues
Lease Revenues
The following table provides a summary of our lease revenues during the three
months ended March 31, 2020 and 2019 (dollars in thousands):

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                                           For the Three Months Ended March 31,
                                         2020           2019      $ Change     % Change
Same-property basis:
Fixed lease payments               $    7,966         $ 7,713    $      253      3.3%
Participation rents                        30              27             3      11.1%
Lease termination income, net           2,810               -         2,810       -%
Total - Same-property basis            10,806           7,740         3,066      39.6%
Properties acquired or disposed of      4,228              24         4,204 

17,516.7%

Vacant or self-operated properties         68              36            32      88.9%
Tenant reimbursements(1)                  178              30           148     493.3%
Total Lease revenues               $   15,280         $ 7,830    $    7,450      95.1%


(1)  Tenant reimbursements generally represent tenant-reimbursed property
     operating expenses on certain of our farms, including property taxes,
     insurance premiums, and other property-related expenses. Corresponding
     amounts were also recorded as property operating expenses during the
     respective periods.


Same-property Basis - 2020 compared to 2019
Lease revenues from fixed lease payments increased for the three-months ended
March 31, 2020, primarily due to recent lease renewals at net higher rental
rates, as well as additional rents earned on recent capital improvements
completed on certain of our farms.
Lease revenues from participation rents remained relatively flat for the three
months ended March 31, 2020.
During the three months ended March 31, 2020, we received an early lease
termination payment from an outgoing tenant on a property of approximately $3.0
million, which we recognized as additional lease revenue upon receipt, less a
net balance of approximately $165,000 of aggregate prepaid rent and deferred
rent assets balances that were written off against this amount. For further
discussion on this lease termination, see above, under "Overview-Recent
Developments-Portfolio Activity-Existing Properties-Leasing Activity-Lease
Termination."
Other - 2020 compared to 2019
Lease revenues from properties acquired or disposed of increased for the three
months ended March 31, 2020, primarily due to additional revenues earned on new
farms acquired subsequent to December 31, 2018.
Lease revenue for vacant or self-operated properties increased for the three
months ended March 31, 2020, primarily due to additional revenues earned during
2020 on farms that were vacant for a portion of 2019.
The increase in tenant reimbursements for the three months ended March 31, 2020,
was due to additional contractual reimbursements of property taxes and other
operating costs. Tenant reimbursements during the three months ended March 31,
2020, also included payments made by a tenant on our behalf (pursuant to the
lease agreement) to an unconsolidated entity of ours that conveys water to the
respective property.
Operating Expenses
Depreciation and Amortization
The following table provides a summary of the depreciation and amortization
expense recorded during the three months ended March 31, 2020 and 2019 (dollars
in thousands):
                                           For the Three Months Ended March 31,
                                                                     $           %
                                          2020           2019      Change     Change
Same-property basis                 $   3,062          $ 2,554    $   508      19.9%
Properties acquired or disposed of      1,159                7      1,152   

16,457.1%

Vacant or self-operated properties         36               36          -   

-%

Total depreciation and amortization $ 4,257 $ 2,597 $ 1,660

63.9%

Depreciation and amortization expense on a same-property basis increased for the
three months ended March 31, 2020, as compared to the prior-year period,
primarily due to accelerated amortization expense recognized due to an early
lease termination (see above, under "Overview-Recent Developments-Portfolio
Activity-Existing Properties-Leasing Activity-Lease Termination"), as well as
additional depreciation on site improvements completed on certain properties
subsequent to

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December 31, 2018, and partially offset by the expiration of certain lease
intangible amortization periods subsequent to December 31, 2018. Depreciation
and amortization expense on properties acquired or disposed of increased for the
three months ended March 31, 2020, as compared to the prior-year period,
primarily due to the additional depreciation and amortization expense incurred
on the new farms acquired subsequent to December 31, 2018. Depreciation and
amortization expense from vacant or self-operated properties for the three
months ended March 31, 2020, remained flat when compared to the prior-year
period.
Property-operating Expenses
Property operating expenses consist primarily of real estate taxes, repair and
maintenance expense, insurance premiums, and other miscellaneous operating
expenses paid for certain of our properties. In addition, from approximately
July 2018 through June 2019, we incurred additional expenses related to
temporary generator rental costs to power newly-drilled wells on one of our
properties. During the second half of 2019, these wells were connected to
permanent power sources, and the generators were no longer needed. The following
table provides a summary of the property-operating expenses recorded during the
three months ended March 31, 2020 and 2019 (dollars in thousands):
                                                       For the Three Months Ended March 31,
                                                                                $           %
                                                    2020          2019        Change      Change
Same-property basis                              $     327     $    766     $   (439 )   (57.3)%
Properties acquired or disposed of                      12            4            8      200.0%
Vacant or self-operated properties                       4           16          (12 )   (75.0)%
Tenant-reimbursed property operating expenses(1)       178           30          148      493.3%
Total Property operating expenses                $     521     $    816

$ (295 ) (36.2)%

(1) Represents certain operating expenses (property taxes, insurance premiums,

and other property-related expenses) paid by us that, per the respective

leases, are required to be reimbursed to us by the tenant. Corresponding

amounts were also recorded as lease revenues during the respective periods.

Same-property Basis - 2020 compared to 2019
For the three months ended March 31, 2020, property operating expenses decreased
due to additional costs incurred during the prior-year period for the
above-referenced generator rentals and for obtaining certain permits on one of
our California properties.
Other - 2020 compared to 2019
Property operating expenses on properties acquired or disposed of increased for
the three months ended March 31, 2020, primarily due to additional miscellaneous
property operating expenses incurred on certain of the new farms we acquired
subsequent to December 31, 2018. Property operating expenses on vacant or
self-operated properties decreased for the three months ended March 31, 2020,
primarily due to additional property taxes incurred by us during the vacant
period on these two farms during the prior-year period, as well as additional
legal costs incurred associated with drafting new lease agreements. The increase
in tenant-reimbursed property operating expenses for the three months ended
March 31, 2020, was due to additional property taxes paid by us on certain of
our properties, as well as miscellaneous operating costs incurred by us in
connection with our ownership interest in an unconsolidated entity. In both of
these situations, the respective tenants are contractually obligated to
reimburse us per the respective leases.
Related-Party Fees
Certain fee calculations changed pursuant to amendments to the agreements with
our Adviser that were approved on July 9, 2019, and January 14, 2020. For a
discussion of the changes to these fees, see above, under "Overview-Our Adviser
and Administrator-Advisory Agreements." The following table summarizes the base
management, incentive, and capital gains fees due to our Adviser, in each case,
as applicable, net of the respective credits, for the three months ended
March 31, 2020 and 2019 (dollars in thousands):

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                                                          For the Three Months Ended March 31,
                                                       2020         2019        $ Change     % Change
Base management fee, gross(1)                      $    1,034     $   905     $      129      14.3%
Credits granted by Adviser's board of directors
applied against the base management fee(2)                  -        (569 )          569     (100.0)%
Base management fee, net                                1,034         336            698      207.7%
Incentive fee, gross(1)                                 1,334           -          1,334        -%
Credits granted by Adviser's board of directors
applied against the incentive fee(2)                        -           -              -        -%
Incentive fee, net                                      1,334           -          1,334        -%
Capital gains fee, gross(1)                                 -           -              -        -%
Credits granted by Adviser's board of directors
applied against the capital gains fee(2)                    -           -              -        -%
Capital gains fee, net                                      -           -              -        -%
Total fees to Adviser, gross                            2,368         905          1,463      161.7%
Total credits granted by Adviser's board of
directors(1)                                                -        (569 )          569     (100.0)%
Total fees to Adviser, net                         $    2,368     $   336     $    2,032      604.8%


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

(2) Represent non-contractual, unconditional, and irrevocable waivers granted to

us by our Adviser.

The base management fee increased during the three months ended March 31, 2020,
as compared to the prior-year period, primarily due to a change in the
calculation of the base management fee. For the three months ended March 31,
2020, the base management fee was calculated as 0.125% (0.5% per annum) of the
Gross Tangible Real Estate as of December 31, 2019, which base was increased due
to a large volume of acquisitions during 2019, whereas the base management fee
for the three months ended March 31, 2019, was calculated as 0.5% (2.0% per
annum) of the Total Adjusted Equity as of December 31, 2018. See above, under
"Overview-Our Adviser and Administrator-Advisory Agreements-Base Management
Fee," for further discussion on the calculation of the base management fee for
each period. In addition, our Adviser granted us a non-contractual,
unconditional, and irrevocable waiver to be applied against the base management
fee during the three months ended March 31, 2019.
Our Adviser earned an incentive fee during the three months ended March 31,
2020, due to our Pre-Incentive Fee FFO (as defined in the respective agreement
with our Adviser) exceeding the required hurdle rate of the applicable base. No
incentive fee was earned by our Adviser during the three months ended March 31,
2019.
Our Adviser did not earn a capital gains fee during either of the three months
ended March 31, 2020 or 2019, as we did not sell any of our properties during
either period.
The administration fee paid to our Administrator increased for the three months
ended March 31, 2020, as compared to the prior-year period, primarily due to
hiring additional personnel and us using a higher overall share of our
Administrator's resources in relation to those used by other funds and
affiliated companies serviced by our Administrator.
Other Operating Expenses
General and administrative expenses consist primarily of professional fees,
director fees, stockholder-related expenses, overhead insurance,
acquisition-related costs for investments no longer being pursued, and other
miscellaneous expenses. General and administrative expenses remained relatively
flat for the three months ended March 31, 2020, as compared to the prior-year
period, as higher professional fees and stockholder-related expenses were offset
by a decrease in amount of acquisition-related costs expensed.
Other Income (Expense)
Other income, which generally consists of interest patronage received from Farm
Credit (as defined in Note 4, "Borrowings," in the accompanying notes to our
condensed consolidated financial statements) and interest earned on short-term
investments, increased for the three months ended March 31, 2020, as compared to
the prior-year period, primarily driven by additional interest patronage
received from Farm Credit (due to increased borrowings from Farm Credit). During
the three months ended March 31, 2020, we recorded approximately $1.3 million of
interest patronage from Farm Credit related to interest accrued during 2019,
compared to approximately $700,000 of interest patronage recorded during the
prior-year period. The receipt of interest patronage received from Farm Credit
during 2020 resulted in a 20.4% decrease (approximately 98 basis points) to our
effective interest rate on our aggregate borrowings from Farm Credit during the
year ended December 31, 2019. In addition,

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during the three months ended March 31, 2019, we recognized $110,000 of income
as a result of accumulated deferred revenue related to a sale agreement for one
of our farms that was terminated.
Interest expense increased for the three months ended March 31, 2020, as
compared to the prior-year period, primarily due to increased overall
borrowings. The weighted-average principal balance of our aggregate borrowings
(excluding our Series A Term Preferred Stock) outstanding for the three months
ended March 31, 2020, was approximately $481.3 million, as compared to
approximately $336.3 million for the prior-year period. Excluding interest
patronage received on certain of our Farm Credit borrowings and the impact of
debt issuance costs, the overall effective interest rate charged on our
aggregate borrowings was 3.98% and 3.93% for the three months ended March 31,
2020 and 2019, respectively.
During each of the three months ended March 31, 2020 and 2019, we paid aggregate
distributions on our Series A Term Preferred Stock (which distributions are
treated similar to interest expense) of approximately $458,000.
During the three months ended March 31, 2020, we recorded a net loss of
approximately $99,000, primarily due to the disposal of certain irrigation
improvements on two of our farms, partially offset by a gain recognized on the
sale irrigation pivots on another farm that were replaced.
The net property and casualty recoveries recorded during the three months ended
March 31, 2020, related to insurance recoveries received for certain irrigation
improvements that were damaged due to natural disasters during 2019.
During the three months ended March 31, 2020, we recognized approximately
$34,000 of income in an unconsolidated entity. We acquired an interest in this
entity during the three months ended September 30, 2019.
LIQUIDITY AND CAPITAL RESOURCES
Overview
Our current short- and long-term sources of funds include cash and cash
equivalents, cash flows from operations, borrowings (including the undrawn
commitments available under the New MetLife Facility), and issuances of
additional equity securities. Our current available liquidity is approximately
$53.7 million, consisting of approximately $28.4 million in cash on hand and,
based on the current level of collateral pledged, approximately $24.2 million of
availability under the MetLife Facility (subject to compliance with covenants).
Future Capital Needs
Our short- and long-term liquidity requirements consist primarily of making
distributions to stockholders (including to non-controlling OP Unitholders, if
any) to maintain our qualification as a REIT, funding our general operating
costs, making principal and interest payments on outstanding borrowings, making
dividend payments on our Series A Term Preferred Stock, Series B Preferred
Stock, and Series C Preferred Stock, and, as capital is available, funding new
farmland and farm-related acquisitions consistent with our investment strategy.
Notwithstanding the current COVID-19 pandemic, we believe that our current and
short-term cash resources will be sufficient to fund our distributions to
stockholders (including non-controlling OP Unitholders), service our debt, pay
dividends on our Series A Term Preferred Stock, Series B Preferred Stock, and
Series C Preferred Stock, and fund our current operating costs in the near term.
We expect to meet our long-term liquidity requirements through various sources
of capital, including future equity issuances (including, but not limited to,
shares of common stock through our ATM Program, OP Units through our Operating
Partnership as consideration for future acquisitions, and shares of our Series C
Preferred Stock), long-term mortgage indebtedness and bond issuances, and other
secured and unsecured borrowings. While public equity markets have experienced
significant volatility lately, based on discussions with our lenders, we do not
believe there will be a credit freeze in the near term. We are in compliance
with all of our debt covenants under our respective credit facilities, and we
believe we currently have adequate liquidity to cover all near-term debt
obligations and operating expenses.
We intend to use a significant portion of any current and future available
liquidity to purchase additional farms and farm-related facilities. We continue
to actively seek and evaluate acquisitions of additional farms and farm-related
facilities that satisfy our investment criteria, and despite the current
COVID-19 pandemic, our pipeline of potential acquisitions remains healthy. We
have several properties under signed purchase and sale agreements or non-binding
letters of intent that we hope to consummate over the next six months. We also
have many other properties that are in various other stages of our due diligence
process. However, all potential acquisitions will be subject to our due
diligence investigation of such properties, and there can be no assurance that
we will be successful in identifying or acquiring any properties in the future.
Cash Flow Resources

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The following table summarizes total net cash flows from operating, investing,
and financing activities for the three months ended March 31, 2020 and 2019
(dollars in thousands):
                                            For the Three Months Ended March 31,
                                                 2020                     2019            $ Change      % Change
Net change in cash from:
Operating activities                    $            3,496         $          2,432     $     1,064       43.8%
Investing activities                               (10,168 )                 (5,717 )        (4,451 )     77.9%
Financing activities                                23,216                   11,663          11,553       99.1%
Net change in Cash and cash equivalents $           16,544         $        

8,378 $ 8,166 97.5%

Operating Activities
The majority of cash from operating activities is generated from the rental
payments we receive from our tenants, which is first used to fund our
property-level operating expenses, with any excess cash being primarily used for
principal and interest payments on our borrowings, management fees to our
Adviser, administrative fees to our Administrator, and other corporate-level
expenses. Cash provided by operating activities increased for the three months
ended March 31, 2020, as compared to the prior-year period, primarily due to an
early lease termination payment of approximately $3.0 million received from the
outgoing tenant on four of our farms in Arizona and additional rental payments
received from recent acquisitions, partially offset by increases in the amounts
of fees paid to our Adviser and interest payments made during the three months
ended March 31, 2020. As of the date of this filing, all but one of our tenants
are current in their rental payments to us, and we have not received any
requests from tenants seeking rent relief as a result of COVID-19. Further, we
currently expect rental payments to continue to be paid on time for at least the
foreseeable future. However, there can be no assurance that our business and
financial and operational results will not be impacted by the COVID-19 pandemic
or that we will be able to pay distributions to our stockholders in the future
at the same rate, or at all.
Investing Activities
The increase in cash used in investing activities during the three months ended
March 31, 2020, as compared to the prior-year period, was primarily due to an
increase in aggregate cash paid for acquisitions of new farms and capital
improvements on existing farms during the three months ended March 31, 2020,
which was approximately $4.8 million more than the prior-year period.
Financing Activities
The increase in cash provided by financing activities during the three months
ended March 31, 2020, as compared to the prior-year period, was primarily due to
net cash proceeds from equity issuances (including the Series B Preferred Stock
and our common stock) of approximately $16.3 million, partially offset by a
decrease in net borrowings of approximately $2.4 million for the three months
ended March 31, 2020, as compared to that of the prior-year period.
Debt Capital
New MetLife Facility
As amended on February 20, 2020, the New MetLife Facility currently consists of
the $75.0 million New MetLife Term Note and the $75.0 million MetLife Lines of
Credit. We currently have no outstanding balance on the New MetLife Term Note
and $100,000 outstanding under the MetLife Lines of Credit. While $149.9 million
of the full commitment amount under the New MetLife Facility remains undrawn,
based on the current level of collateral pledged, we currently have
approximately $24.2 million of availability under the New MetLife Facility. The
draw period for the New MetLife Term Note expires on December 31, 2022, after
which time MetLife has the option to be relieved of its obligation to disburse
any additional undrawn funds under the New MetLife Term Note.
Farmer Mac Facility
As amended on June 16, 2016, our agreement with Federal Agricultural Mortgage
Corporation ("Farmer Mac") provided for bond issuances up to an aggregate amount
of $125.0 million (the "Farmer Mac Facility") by December 11, 2018, after which
Farmer Mac had the option to be relieved of its obligation to purchase
additional bonds under this facility. As of December 11, 2018, we had issued
aggregate bonds of approximately $108.7 million under the Farmer Mac Facility,
and Farmer Mac is not obligated to purchase the remaining unissued bonds.
However, since December 11, 2018, we have refinanced three bonds previously
issued under the Farmer Mac Facility for total proceeds of approximately $22.0
million, which equaled the

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aggregate value of the previously-issued bonds. We expect to continue to be able
to refinance existing bonds under the facility as they mature (so long as we
remain in compliance with the applicable covenants, as we currently are), though
Farmer Mac is under no obligation to do so. We are also continuing discussions
with Farmer Mac for other borrowing opportunities, including expanding the size
of the existing facility and extending its borrowing period; however, there is
no guarantee that we will be able to reach terms favorable to us, if at all.
Farm Credit and Other Lenders
Since September 2014, we have closed on 30 separate loans with 10 different Farm
Credit associations (for additional information on these associations, see Note
4, "Borrowings," within the accompanying notes to our condensed consolidated
financial statements). We also currently have borrowing relationships with three
other agricultural lenders and are continuously reaching out to other lenders to
establish prospective new relationships. While we do not have any additional
availability under any of these programs based on the properties currently
pledged as collateral, we expect to enter into additional borrowing agreements
with existing and new lenders in connection with certain potential new
acquisitions in the future. In addition, we currently have two farms appraised
at approximately $7.5 million that are unencumbered and eligible to be pledged
as collateral.
Equity Capital
The following table provides information on equity sales that have occurred
since January 1, 2020 (dollars in thousands, except per-share amounts):
                                          Number of      Weighted-average
  Type of Issuance                       Shares Sold      Offering Price       Gross Proceeds       Net Proceeds(1)
Series B Preferred
Stock(2)                                  1,229,531    $            24.52     $        30,148     $          27,664
Series C Preferred
Stock                                      15,600                   25.00                 390                   355
Common Stock - ATM
Program                                    409,800                  13.28               5,441                 5,386

(1) Net of selling commissions and dealer-manager fees or underwriting discounts

(in each case, as applicable).

(2) Includes share redemptions during the applicable time period.

Our 2020 Registration Statement (as defined in Note 8, "Equity-Registration
Statement," within the accompanying notes to our condensed consolidated
financial statements) permits us to issue up to an aggregate of $1.0 billion in
securities (including up to $650.0 million reserved for issuance of shares of
the Series C Preferred Stock), 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. To date, we have issued approximately $390,000 of Series C Preferred
Stock under the 2020 Registration Statement.
In addition, we have the ability to, and expect to in the future, issue
additional OP Units to third parties as consideration in future property
acquisitions.
Off-Balance Sheet Arrangements
As of March 31, 2020, we did not have any material off-balance sheet
arrangements.
NON-GAAP FINANCIAL INFORMATION
Funds from Operations, Core Funds from Operations, and Adjusted Funds from
Operations
The National Association of Real Estate Investment Trusts ("NAREIT") developed
funds from operations ("FFO") as a relative non-GAAP supplemental measure of
operating performance of an equity REIT to recognize that income-producing real
estate historically has not depreciated on the same basis as determined under
GAAP. FFO, as defined by NAREIT, is net income (computed in accordance with
GAAP), excluding gains or losses from sales of property and impairment losses on
property, plus depreciation and amortization of real estate assets, and after
adjustments for unconsolidated partnerships and joint ventures. We further
present core FFO ("CFFO") and adjusted FFO ("AFFO") as additional non-GAAP
financial measures of our operational performance, as we believe both CFFO and
AFFO improve comparability on a period-over-period basis and are more useful
supplemental metrics for investors to use in assessing our operational
performance on a more sustainable basis than FFO. We believe that these
additional performance metrics, along with the most directly-comparable GAAP
measures, provide investors with helpful insight regarding how management
measures our ongoing performance, as each of CFFO and AFFO (and their respective
per-share amounts) are used by management and our board of directors, as
appropriate, in assessing overall performance, as well as in certain
decision-making analysis, including, but not limited to, the timing of
acquisitions and

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potential equity raises (and the type of securities to offer in any such equity
raises), the determination of any fee credits, and declarations of distributions
on our common stock. The non-GAAP financial measures presented herein have
limitations as analytical tools and should not be considered in isolation or as
a substitute for an analysis of our results calculated in accordance with GAAP.
We believe that net income is the most directly-comparable GAAP measure to each
of FFO, CFFO, and AFFO.
Specifically, we believe that FFO is helpful to investors in better
understanding our operating performance, primarily because its calculation
excludes depreciation and amortization expense on real estate assets, as we
believe that GAAP historical cost depreciation of real estate assets is
generally not correlated with changes in the value of those assets, particularly
with farmland real estate, the value of which does not diminish in a predictable
manner over time, as historical cost depreciation implies. Further, we believe
that CFFO and AFFO are helpful in understanding our operating performance in
that it removes certain items that, by their nature, are not comparable on a
period-over-period basis and therefore tend to obscure actual operating
performance. In addition, we believe that providing CFFO and AFFO as additional
performance metrics allows investors to gauge our overall performance in a
manner that is more similar to how our performance is measured by management
(including their respective per-share amounts), as well as by analysts and the
overall investment community.
We calculate CFFO by adjusting FFO for the following items:

• Acquisition- and disposition-related expenses. Acquisition- and

disposition-related expenses (including due diligence costs on acquisitions

not consummated and certain auditing and accounting fees incurred that were

directly related to completed acquisitions or dispositions) are incurred

for investment purposes and do not correlate with the ongoing operations of

our existing portfolio. Further, certain auditing and accounting fees

incurred vary depending on the number and complexity of acquisitions or

dispositions completed during the period. Due to the inconsistency in which

these costs are incurred and how they have historically been treated for

accounting purposes, we believe the exclusion of these expenses improves

comparability of our operating results on a period-to-period basis.

Other adjustments. We will adjust for certain non-recurring charges and receipts
and will explain such adjustments accordingly. We believe the exclusion of such
non-recurring amounts improves comparability of our operating results on a
period-to-period basis and will apply consistent definitions of CFFO and AFFO
for all prior-year periods presented to provide consistency and better
comparability.
Further, we calculate AFFO by adjusting CFFO for the following items:

• Rent adjustments. This adjustment removes the effects of straight-lining

rental income, as well as the amortization related to above-market lease

values and lease incentives and accretion related to below-market lease

values, other deferred revenue, and tenant improvements, resulting in

rental income reflected on a modified accrual cash basis. In addition to

these adjustments, we also modify the calculation of cash rents within our

definition of AFFO to provide greater consistency and comparability due to

the period-to-period volatility in which cash rents are received. To

coincide with our tenants' harvest seasons, our leases typically provide

for cash rents to be paid at various points throughout the lease year,

usually annually or semi-annually. As a result, cash rents received during

a particular period may not necessarily be comparable to other periods or

      represent the cash rents indicative of a given lease year. Therefore, we
      further adjust AFFO to normalize the cash rent received pertaining to a
      lease year over that respective lease year on a straight-line basis,

resulting in cash rent being recognized ratably over the period in which

the cash rent is earned.

• Amortization of debt issuance costs. The amortization of costs incurred to

      obtain financing is excluded from AFFO, as it is a non-cash expense item
      that is not directly related to the operating performance of our
      properties.


We believe the foregoing adjustments aid our investors' understanding of our
ongoing operational performance.
FFO, CFFO and AFFO do not represent cash flows from operating activities in
accordance with GAAP, which, unlike FFO, CFFO, and AFFO, generally reflects all
cash effects of transactions and other events in the determination of net
income, and should not be considered an alternative to net income as an
indication of our performance or to cash flows from operations as a measure of
liquidity or ability to make distributions. Comparisons of FFO, CFFO, and AFFO,
using the NAREIT definition for


FFO and the definitions above for CFFO and AFFO, to similarly-titled measures
for other REITs may not necessarily be meaningful due to possible differences in
the definitions used by such REITs.
Diluted funds from operations ("Diluted FFO"), diluted core funds from
operations ("Diluted CFFO"), and diluted adjusted funds from operations
("Diluted AFFO") per share are FFO, CFFO, and AFFO, respectively, divided by the
weighted-average number of total shares (including shares of our common stock
and OP Units held by non-controlling limited partners) outstanding on a
fully-diluted basis during a period. We believe that diluted earnings per share
is the most directly-comparable GAAP measure to each of Diluted FFO, CFFO, and
AFFO per share. Because many REITs provide Diluted FFO, CFFO, and

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AFFO per share information to the investment community, we believe these are
useful supplemental measures when comparing us to other REITs.
We believe that FFO, CFFO, and AFFO and Diluted FFO, CFFO, and AFFO per share
are useful to investors because they provide investors with a further context
for evaluating our FFO, CFFO, and AFFO results in the same manner that investors
use net income and EPS in evaluating net income.
The following table provides a reconciliation of our FFO, CFFO, and AFFO for the
three months ended March 31, 2020 and 2019 to the most directly-comparable GAAP
measure, net income, and a computation of diluted FFO, CFFO, and AFFO per share,
using the weighted-average number of total shares (including shares of our
common stock and OP Units held by non-controlling OP Unitholders) outstanding
during the respective periods (dollars in thousands, except per-share amounts):
                                                           For the Three Months Ended March 31,
                                                                2020                    2019
Net income                                              $           3,101         $           108
Less: Dividends declared on Series B Preferred Stock               (2,125 )                  (601 )
Net income (loss) available to common stockholders and                976                    (493 )
non-controlling OP Unitholders
Plus: Real estate and intangible depreciation and                   4,257                   2,597

amortization

Plus: Losses on dispositions of real estate assets, net                99                      32
Adjustments for unconsolidated entities(1)                              4                       -
FFO available to common stockholders and                            5,336                   2,136
non-controlling OP Unitholders
Plus: Acquisition- and disposition-related expenses                    10                     139
(Less) plus: Other (receipts) charges, net(2)                         (79 )                     3
CFFO available to common stockholders and                           5,267                   2,278
non-controlling OP Unitholders
Net rent adjustment                                                    (4 )                    34
Plus: Amortization of debt issuance costs                             179                     150
AFFO available to common stockholders and                           5,442                   2,462

non-controlling OP Unitholders

Weighted-average common stock outstanding-basic and            21,262,080              18,028,826

diluted

Weighted-average common non-controlling OP Units                  288,303                 433,393

outstanding

Weighted-average total common shares outstanding               21,550,383              18,462,219

Diluted FFO per weighted-average total common share     $            0.25         $          0.12
Diluted CFFO per weighted-average total common share    $            0.24         $          0.12
Diluted AFFO per weighted-average total common share    $            0.25   

$ 0.13

(1) Represents our pro-rata share of depreciation expense recorded in

unconsolidated entities during the period.

(2) Consists primarily of net property and casualty recoveries recorded and the

cost of related repairs expensed during each period as a result of the

damage to certain irrigation improvements and, for the three months ended

March 31, 2020, only, our pro-rata share of income recorded from investments

in unconsolidated entities during the period.

Net Asset Value
Real estate companies are required to record real estate using the historical
cost basis of the real estate, adjusted for accumulated depreciation and
amortization, and, as a result, the carrying value of the real estate does not
typically change as the fair value of the assets change. Thus, one challenge is
determining the fair value of the real estate in order to allow stockholders to
see the value of the real estate increase or decrease over time, which we
believe is useful to our investors.
Determination of Fair Value
Our Board of Directors reviews and approves the valuations of our properties
pursuant to a valuation policy approved by our Board of Directors (the
"Valuation Policy"). Such review and approval occurs in three phases: (i) prior
to its quarterly meetings, the Board of Directors receives written valuation
recommendations and supporting materials that are provided by professionals of
the Adviser and Administrator, with oversight and direction from the chief
valuation officer, who is also employed by the Administrator (collectively, the
"Valuation Team"); (ii) the valuation committee of the Board of Directors (the
"Valuation Committee"), which is comprised entirely of independent directors,
meets to review the valuation recommendations and supporting materials; and
(iii) after the Valuation Committee concludes its meeting, it and the chief
valuation officer present the Valuation Committee's findings to the entire Board
of Directors so that the full Board of Directors may review and approve the fair
values of our properties in accordance with the Valuation Policy. Further, on a
quarterly basis, the Board of

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Directors reviews the Valuation Policy to determine if changes thereto are
advisable and also reviews whether the Valuation Team has applied the Valuation
Policy consistently.
Per the Valuation Policy, our valuations are generally derived based on the
following:
•    For properties acquired within 12 months prior to the date of valuation, the

purchase price of the property will generally be used as the current fair

value unless overriding factors apply. In situations where OP Units are

issued as partial or whole consideration in connection with the acquisition

of a property, the fair value of the property will generally be the lower

of: (i) the agreed-upon purchase price between the seller and the buyer (as

shown in the purchase and sale agreement or contribution agreement and using

the agreed-upon pricing of the OP Units, if applicable), or (ii) the value

as determined by an independent, third-party appraiser.

• For real estate we acquired more than one year prior to the date of

valuation, we determine the fair value either by relying on estimates

provided by independent, third-party appraisers or through an internal

valuation process. In addition, if significant capital improvements take

place on a property, we will typically have those properties reappraised

upon completion of the project by an independent, third-party appraiser. In

any case, we intend to have each property valued by an independent,

third-party appraiser via a full appraisal at least once every three years,

with interim values generally being determined by either: (i) a restricted

appraisal (a "desk appraisal") performed by an independent, third-party

appraiser, or (ii) our internal valuation process.

Various methodologies were used, both by the appraisers and in our internal
valuations, to determine the fair value of our real estate, including the sales
comparison, income capitalization (or a discounted cash flow analysis), and cost
approaches of valuation. In performing their analyses, the appraisers typically
(i) conducted site visits to the properties (where full appraisals were
performed), (ii) discussed each property with our Adviser and reviewed
property-level information, including, but not limited to, property operating
data, prior appraisals (as available), existing lease agreements, farm acreage,
location, access to water and water rights, potential for future development,
and other property-level information, and (iii) reviewed information from a
variety of sources about regional market conditions applicable to each of our
properties, including, but not limited to, recent sale prices of comparable
farmland, market rents for similar farmland, estimated marketing and exposure
time, market capitalization rates, and the current economic environment, among
others. In performing our internal valuations, we will consider the most recent
appraisal available and use similar methodologies in determining an updated fair
value. We will also obtain updated market data related to the property, such as
updated sales and market rent comparisons and market capitalization rates, and
perform an updated assessment of the tenants' credit risk profiles, among
others. Sources of this data may come from market inputs from recent
acquisitions of our own portfolio of real estate, recent appraisals of
properties we own that are similar in nature and in the same region (as
applicable) as the property being valued, market conditions and trends we
observe in our due diligence process, and conversations with appraisers,
brokers, and farmers.
A breakdown of the methodologies used to value our properties and the aggregate
value as of March 31, 2020, determined by each method is shown in the table
below (dollars in thousands, except in footnotes):
  Valuation             Number of    Total       Farm      Net Cost        

Current % of Total

   Method                 Farms      Acres      Acres      Basis(1)       Fair Value     Fair Value
Purchase                   27        13,960     12,705    $ 258,876     $    258,032       28.9%
Price
Third-party                86        73,900     58,344      542,634          633,523       71.1%
Appraisal(2)
Total                      113       87,860     71,049    $ 801,510     $    891,555       100.0%

(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 paid for by us that were

associated with the properties, and adjusted for accumulated depreciation

and amortization.

(2) Appraisals performed between June 2019 and April 2020.

Some of the significant assumptions used by appraisers and the Valuation Team in
valuing our portfolio as of March 31, 2020, include land values per farmable
acre, market rental rates per farmable acre and the resulting net operating
income ("NOI") at the property level, and capitalization rates, among others.
These assumptions were applied on a farm-by-farm basis and were selected based
on several factors, including comparable land sales, surveys of both existing
and current market rates, discussions with other brokers and farmers, soil
quality, size, location, and other factors deemed appropriate. A summary of
these significant assumptions is provided in the following table:
                                     Range         Weighted
                                  (Low - High)     Average

Land Value (per farmable acre) $680 - $87,280 $ 30,343 Market NOI (per farmable acre) $780 - $4,877 $ 2,749 Market Capitalization Rate 4.00% - 10.00% 4.51%

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Note: Figures in the table above apply only to the farmland portion of our
portfolio and exclude assumptions made relating to farm-related facilities
(e.g., cooling facilities), and other structures on our properties (e.g.,
residential housing), as their aggregate value was considered to be
insignificant in relation to that of the farmland.
Our Valuation Team reviews the appraisals, including the significant assumptions
and inputs used in determining the appraised values, and considers any
developments that may have occurred since the time the appraisals were
performed. Developments considered that may have an impact on the fair value of
our real estate include, but are not limited to, changes in tenant credit
profiles, changes in lease terms (such as expirations and notices of
non-renewals or to vacate), and potential asset sales (particularly those at
prices different from the appraised values of our properties).
Management believes that the purchase prices of the farms acquired during the
previous 12 months and the most recent appraisals available for the farms
acquired prior to the previous 12 months fairly represent the current market
values of the properties as of March 31, 2020, and, accordingly, did not make
any adjustment to these values.
A quarterly roll-forward of the change in our portfolio value for the three
months ended March 31, 2020, from the prior value basis as of June 30, 2019, is
provided in the table below (dollars in thousands):
Total portfolio fair value as of December 31, 2019                       $  

877,485

Plus: Acquisition of two new farms during the three months ended March 31, 2020

7,500

Plus net value appreciation during the three months ended March 31, 2020: 30 farms valued via third-party appraisals

$   6,570

Total net appreciation for the three months ended March 31, 2020

6,570

Total portfolio fair value as of March 31, 2020                          $  

891,555

Management also determined fair values of all long-term borrowings and preferred
stock. Using a discounted cash flow analysis, management determined that the
fair value of all long-term encumbrances on our properties as of March 31, 2020,
was approximately $481.3 million, as compared to a carrying value (excluding
unamortized related debt issuance costs) of approximately $480.6 million. In
addition, using the closing stock price as of March 31, 2020, the fair value of
the Series A Term Preferred Stock was determined to be approximately $28.6
million, as compared to a carrying value (excluding unamortized related issuance
costs) of approximately $28.8 million. Finally, pursuant to Financial Industry
Regulatory Authority Rule 2310(b)(5), with the assistance of a third-party
valuation expert, we determined the estimated value of our Series B Preferred
Stock to be $25.00 per share as of March 31, 2020 (see Exhibit 99.1 to this Form
10-Q).
Calculation of Estimated Net Asset Value
To provide our stockholders with an estimate of the fair value of our real
estate assets, we intend to estimate the fair value of our farms and
farm-related properties and provide an estimated net asset value ("NAV") on a
quarterly basis. NAV is a non-GAAP, supplemental measure of financial position
of an equity REIT and is calculated as total equity, adjusted for the increase
or decrease in fair value of our real estate assets and long-term borrowings
(including any preferred stock required to be treated as debt for GAAP purposes)
relative to their respective costs bases. Further, we calculate NAV per common
share by dividing NAV by our total common shares outstanding (consisting of our
common stock and OP Units held by non-controlling limited partners).
The fair values presented above and their usage in the calculation of net asset
value per share presented below have been prepared by and is the responsibility
of management. PricewaterhouseCoopers LLP has neither examined, compiled, nor
performed any procedures with respect to the fair values or the calculation of
net asset value per common share, which utilizes information that is not
disclosed within the financial statements, and, accordingly, does not express an
opinion or any other form of assurance with respect thereto.
As of March 31, 2020, we estimate the NAV per common share to be $11.46. A
reconciliation of NAV to total equity, which we believe is the most
directly-comparable GAAP measure, is provided below (dollars in thousands,
except per-share data):

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Total equity per balance sheet                                            $ 

308,055

Fair value adjustment for long-term assets:
Less: net cost basis of tangible and intangible real       $ (801,510 )
estate holdings(1)
Plus: estimated fair value of real estate holdings(2)         891,555
Net fair value adjustment for real estate holdings                          

90,045

Fair value adjustment for long-term liabilities: Plus: book value of aggregate long-term indebtedness(3) 509,312 Less: fair value of aggregate long-term indebtedness(3)(4) (509,978 ) Net fair value adjustment for long-term indebtedness

                              (666 )
Estimated NAV                                                               

397,434

Less: fair value of Series B Preferred Stock(5)                               (149,441 )
Estimated NAV available to common stockholders and                        $ 

247,993

non-controlling OP Unitholders
Total common shares and OP Units outstanding(6)                             

21,634,761

Estimated NAV per common share and OP Unit                                $      11.46


(1)  Per Net Cost Basis as presented in the table above.


(2)  Per Current Fair Value as presented in the table above.

(3) Includes the principal balances outstanding of all long-term borrowings

(consisting of notes and bonds payable) and the Series A Term Preferred

Stock.

(4) Long-term notes and bonds payable were valued using a discounted cash flow

model. The Series A Term Preferred Stock was valued based on its closing

     stock price as of March 31, 2020.


(5)  Valued at the security's liquidation value, as discussed above.


(6)  Includes 21,346,458 shares of common stock and 288,303 OP Units held by
     non-controlling OP Unitholders.


A quarterly roll-forward in the estimated NAV per common share for the three
months ended March 31, 2020, is provided below:
Estimated NAV per common share and non-controlling OP Unit                 $    11.41
as of December 31, 2019
Plus net income available to common stockholders and                        

0.04

non-controlling OP Unitholders
Plus net change in valuations:
Net change in unrealized fair value of farmland             $     0.34

portfolio(1)

Net change in unrealized fair value of long-term                 (0.01 )

indebtedness

Net change in valuations                                                    

0.33

Less distributions on common stock and non-controlling OP                       (0.13 )
Units
Less net dilutive effect of equity issuances                                    (0.19 )
Estimated NAV per common share and non-controlling OP Unit                 $    11.46
as of March 31, 2020

(1) The net change in unrealized fair value of our farmland portfolio consists

of three components: (i) an increase of $0.30 per share due to the net

appreciation in value of the farms that were valued during the three months

ended March 31, 2020, (ii) an increase of $0.20 per share due to the

aggregate depreciation and amortization expense recorded during the three

months ended March 31, 2020, and (iii) a decrease of $0.16 per share due to

capital improvements made on certain farms that have not yet been considered

in the determination of the respective farms' estimated fair values.

Comparison of estimated NAV and estimated NAV per common share, using the
definitions above, to similarly-titled measures for other REITs may not
necessarily be meaningful due to possible differences in the calculation or
application of the definition of NAV used by such REITs. In addition, the
trading price of our common shares may differ significantly from our most recent
estimated NAV per common share calculation. For example, while we estimated our
NAV per common share to be $11.46 as of March 31, 2020, based on the calculation
above, the closing price of our common stock on March 31, 2020, was $11.85 per
share.
The determination of estimated NAV is subjective and involves a number of
assumptions, judgments, and estimates, and minor adjustments to these
assumptions, judgments, or estimates may have a material impact on our overall
portfolio valuation. In addition, many of the assumptions used are sensitive to
market conditions and can change frequently. Changes in the market environment
and other events that may occur during our ownership of these properties may
cause the values reported above to vary from the actual fair value that may be
obtained in the open market. Further, while management believes the values
presented reflect current market conditions, the ultimate amount realized on any
asset will be based on the timing of such dispositions and the then-current
market conditions. There can be no assurance that the ultimate realized value
upon disposition of an asset will approximate the estimated fair value above.

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