Publicly traded real estate investment trust (REIT) Farmland Partners Inc. says two of its farms in North Carolina will be home to a portion of the 208 MW Amazon Wind Farm US East, which Iberdrola Renewables is building and will own and operate.
Located in Perquimans and Pasquotank counties, the wind farm will deliver power to the electrical grid that supplies both current and future Amazon Web Services Inc. cloud data centers.
After construction, the wind farm will be situated on approximately 28 acres of farmland owned by Farmland Partners, which currently leases the land to a local farmer for approximately $275 per acre and will lease it to Iberdrola Renewables for approximately $2,600 per acre over a 25-year lease term.
As a result, the REIT expects the total rent across the 1,839 acres of leasable farmland comprising these two farms to increase by approximately 13%. The wind leases may generate returns beyond the forecasted levels, based on annual increases under the consumer price index and additional construction activity by the tenant.
‘Renewable energy projects have the potential to increase the returns we generate from our farm holdings," says Paul Pittman, CEO of Farmland Partners. ‘This and other renewable energy projects under consideration are examples of how we pursue opportunities to increase rents on our land by finding additional revenue sources beyond traditional farm leases.’