Q4 2025 – Farmland Investing Models
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Farmland Investing Models:
Is it better to lease to farmers or directly operate farms in uncertain economic times?
Canadian investors today are navigating a complex macroeconomic backdrop marked by persistent inflation, slower growth, and rising unemployment (often signs of a “stagflationary” environment). These factors have contributed to increasing investment interest in farmland, which stands out as a compelling inflation-hedging, defensive asset. Its appeal lies in its scarcity, potential for productivity growth and therefore long-term capital appreciation, and its potential to generate consistent, uncorrelated, riskadjusted returns.
In this quarter’s newsletter, we take a closer look at how economic conditions are evolving, why they matter for farmland investors, and how different investment/ownership structures perform under pressure. Specifically, we compare direct invest-andoperate models with invest-and-lease strategies to help investors better understand how each approach behaves in a stagflationary environment, assessing which approach can deliver stronger downside protection and better risk-adjusted performance.are committed to the long-term sustainable future of Canadian agriculture.
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