Pension funds and farmland investments
(Reuters) – Pension funds are deepening their commitment to farmland, upping investments by billions of dollars and moving to active strategies, as a hedge against potential inflation and to diversify from riskier investments.
Leading the charge are U.S. and European pension funds, although it is estimated that the amount of institutional money invested is less than 1 percent of global farmland value, with concentration in food exporting regions.
A growing world population, limited water resources and finite amounts of land available have made farmland attractive to investors beyond traditional owners — private families.U.S. pension fund TIAA-CREF has around $2 billion (1.3 billion pounds) invested in farmland of the $426 billion it has under management and is looking to expand its farmland holdings.
“If we found the right opportunities we’d be willing to double our existing exposure over the new few years,” said Jose Minaya, managing director of global private markets at the fund.“This is just another asset class that has the potential of...