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page 2 / 412 . OCR, unverified
to the 2015 crop season, there was also a crop share lease without a fixed component on this farm.
Lease provides for annual rent with CO a fixed component per annum and (ii) subject to certain conditions a flexible rent component based on a percentage of the gross farm
revenue above the dueshold established. We are entitled to a certain percentage of the value of any pecans remaining unsold by August 31 at the average price received for the
sold portion of the crop through that date.
Fixed rent includes an annual escalator.
Extension will only be made if on mutually agreeable [ems and if written notice exercising the option to extend is received by us on or before June I, 2015.
Fixed rent, with an incremental increase of SSO per acre per year beginning January 1. 2014. Tenant also pays a fixed monthly rental amount, due on the first of each month, for the
use of the fenced yantienckned shop and buildings
IS acres arc planted to avocados and 29 acres are planted to lemons.
Lease provides for annual rent with (ii a fixed component per annum for the acts developed for avocados and lemons, respectively, as well as a fixed component per annum for
certain structures and improvements located on the property and (ii) subject to certain conditions, a flexible rent component based on a percentage of the marginal grass ontree
crop revenue above the threshold established for the avocados and lemons. respectively.
S acres are planted to avocados and 4 acres are planted to lemons.
1.131 acres arc mature and 45 are planted with young trees.
Extensions will only he made if on mutually agreeable terms and if written notice exercising the option to extend is received by us on or before April I, 20Ift.
Lease provides for annual rent with (i) a fixed component per tillable acre and (ii) subject to certain conditions, a flexthle rent component based on a percentage of the gross
revenues derived from the leased premises. While the property has 511 planted acres, 432 are planted with mature. leasable acres; the remaining 79 acres arc planted with young.
not mature arcs, which will be governed by the lease once mature.
CONFIDENTIAL - PURSUANT TO FED. R CRIM P 6(e)
DB-SDNY-0085698
CONFIDENTIAL
SDNY_GM_00231882
EFTA01384970
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Kane County Fanns
The Property. We acquired Kane County Farms, a commodity row crop farm in the premier corn
producing area of North-Central Illinois, in June 2011 for a purchase price of approximately
$17.2 million. Kane County Farms consists of 1,652 gross acres, with 1,617 tillable acres, currently
planted with corn in rotation with soybeans on four separate parcels. We hold Kane County Farms in
fee simple through our wholly owned subsidiary Abraham (IL) LLC. On June 30. 2015, Cochran Ag
Services, Inc., an independent Illinois certified general real estate appraiser, concluded that the market
value of the property was $193 million, relying most heavily on the comparable sales approach to
valuation. We have no immediate plans to improve the property. We believe that there may be some
potential for residential development upon disposition in the future as one parcel abuts the 54th ranked
modern golf course, as per Golfweek's 2015 ratings, and with suburban sprawl of the greater Chicago/
Aurora metropolitan area.
Demand Generators and Competition. Kane County Farms is a commodity row crop farm located in
a premier corn-producing area of Illinois for which there is an established and highly competitive
tenant market. Continued global growth in population and consumer income and the demand for
biofucls (e.g., ethanol from corn) and the increasing need for feed for livestock, as well as the location
and high-quality soils (90% Class I) of this property, should, in our opinion, continue to drive leasing
demand for this farm.
Operating and Occupancy Information.
Six Meths
Ended
Year Eaded December 31.
Jane 30.
2015
2014
20t3
2012
241(°I.
Occupancym
100%
100%
100%
100%
100%
Rental revenue)
$351,164
$701,308
$764.409
$721,770
$257,931
Thtal leased acreage')
1,611
1,611
1,611
1,611
1,611
Rent per leased acre
$
218
S
435
$
474
$
448
$
160
0)
Rum was acquired during 2011 and we assumed existing leases.
Based on percentage of tillable acres currently leased.
Subject to a fixed lease.
Appraisal net acreage totals may differ slightly from tillable acreage totals stated in leases and arc rounded.
Description of Tenants
Our farms arc leased to 15 separate third-party tenants, of which the tenant at our Golden Eagle
Ranch farm represented approximately 38.7% of our 2014 contractual rent. Additionally, our tenants at
Blue Heron Farms, Kane County Farms, Pleasant Plains, Sandpiper Ranch, Sweetwater Farm and Quail
Run Vineyard represented approximately 11.7%, 10.6%, 7.6%, 6.1%, 5.7% and 5.6%, respectively, of