Peoples Company president Steve Bruere said he believes that his firm’s acquisition of several farm management companies in 2024 marks an inflection point for the business, which began as a unit of an Iowa bank in the 1960s and has grown into a nationwide farmland management and services company across the US over the last 20 years.
Those two decades coincide with farmland’s financialization, which kicked off after the 2008 financial crisis, and has been facilitated by service providers like Peoples Company and the regional operations Bruere has been rolling up.
Those deals and the growth of Peoples Company’s investment service offering, which can now handle separate accounts of at least $10 million and partnerships of up to $100 million, raise two questions.
First, with so much capital having already been raised to ‘institutionalize’ US farmland, why haven’t these farm management operators, including Peoples Company, already been acquired by asset managers?
Second, do Peoples Company’s separate account and joint venture structures constitute a new alternative model for institutional farmland investment?
Bruere acknowledges some degree of overlap between his firm and fund managers, but stresses Peoples Company continues to retain a role as a complementary party between the investor groups whose capital his firm can now deploy, and the investment firms he works with on acquisitions, disposals and management.
“Even on our capital markets side [as opposed to brokerage or disposals], where we don’t have a client engagement in place, we’re still taking them deals that come across our desk, because we’re knowledgeable of their investment criteria,” he told Agri Investor.
University of Illinois professor Bruce Sherrick told Agri Investor large asset managers have no need for ancillary units that come along with farm management operations and their earlier acquisitions of such firms were motivated in part by large farmland portfolios, which Peoples Company doesn’t have.
He added that Peoples Company’s unique role in institutional markets is the result of deliberate growth into regions and services that has distinguished it from similarly-sized farm management operations still under family control.
“Steve has been more aggressive than some others in locating and figuring out where the footprint makes the most sense,” said Sherrick. “It’s easier to see that if you are on the playing field every day than if you are part of a network that may not have as much density in a local area.”
While some degree of competition for deals between old and new models is inevitable in any market as thin as farmland, Sherrick said Peoples Company and fund managers each serve different enough markets that they can complement each other.
Traditional fund managers may be better positioned to benefit from the macro trends of technology and scale that drive earnings in agriculture, he added, but their structures do not allow for the increasingly specific demands that knowledgeable high-net-worth-individuals may bring into the market.
“If you have a large investor who says: ‘I want to manage this, but I want to be inside the Leading Harvest standard, or have organic only, or I want to be able to use dairy manure from a related enterprise,’ those are hard things to manage if you don’t have an individual farm management group underneath your asset management group,” he said.
A better prepared farm management industry may well have been consolidated long before 2025 had it existed at the time institutional interest in farmland began to grow after 2008.
If Bruere is right that the investment thesis that drew large institutions to farmland during the years since the GFC has been fundamentally undermined by changing macro conditions, coming years will reveal how successful Peoples Company has been in preparing for what’s next.
