US (NE): 1M+ sq. ft. greenhouse acquired for $9.35 million

Power REIT announced that it has acquired a 1,121,513 square foot greenhouse cultivation facility, and associated employee housing property in O’Neill, Nebraska through a wholly-owned subsidiary for $9.35 million.

Simultaneous with the acquisition, Power REIT entered into a long-term, triple-net lease with Millennium Produce of Nebraska LLC. As part of the transaction, Power REIT has agreed to fund capital improvements to upgrade the tomato-ready cultivation facility. Power REIT’s current capital commitment for the initial phase of improvements is approximately $534,000 which includes costs related to the replacement of energy curtains.

David Lesser, Power REIT’s Chairman, and CEO, commented, “This is a very exciting transaction for Power REIT – it is our largest greenhouse facility acquired to date and our first focused on the cultivation of food crops. We acquired this facility at a significant discount to the replacement cost with minimal upgrades needed at closing to commence cultivation. The facility had been operational for 15 years cultivating tomatoes, and we are confident that MillPro will leverage the “ready-to-grow” status of the greenhouse to be a competitive, high-quality, low-cost producer of fresh tomatoes.”

The greenhouse has approximately one million square feet under glass and sits on approximately 86 acres with approximately 20 acres of land available for an additional 880,000 square feet of greenhouse and related space. The Property includes a hanging gutter growing system serviced by a fully automated irrigation system and a central boiler for hydronic heating, as well as logistics space equipped for processing, packaging, warehousing, and shipping activities. The exterior features a stormwater management pond, a 1-million-gallon hot water storage tank, and CO2 storage tanks.

Additionally, the Ogallala Aquifer, a shallow water table beneath the great plains of Nebraska, represents a significant resource to supply the region with fresh water. The Property is fully serviced with natural gas, water and electrical connections. There is a 6.25MVA electrical substation located on-site which provides ample power for existing operations with excess capacity of approximately 5-6MVA and potential to expand up to 18.75MVA. In addition, the leased Property includes a separate employee housing property that has 21 rooms that can handle up to 80 employees.