For Accredited Investors Only
Farmland investing has long been a stable and lucrative asset class, but it hasn’t always been accessible to everyday investors. AcreTrader aims to change that by offering a streamlined platform that allows individuals to invest in high-quality farmland across the U.S. With promises of passive income, long-term growth, and portfolio diversification, AcreTrader has attracted attention from both seasoned and first-time investors.
In this review, we’ll explore how AcreTrader works, its fees, offerings, usage, and whether it’s a good fit for your financial strategy.
- Real, uncorrelated asset class with a history of consistently strong returns
- Highly qualified team with best-in-class underwriting practices
- The platform has some of the lowest fees that you'll find in real estate investing
- Investment minimums are typically $10,000+
- Only open to accredited investors at this time
AcreTrader Ratings at a Glance
- How Does AcreTrader Work?
- Fees
- Ease of Use
- See All 8 Items
How Does AcreTrader Work?
At its core, AcreTrader works in a manner similar to other online real estate investment platforms. The platform is run by a highly experienced team of professionals who offer an income-generating portfolio of investment offerings. The difference is, of course, that AcreTrader offerings are all farmland investing opportunities as opposed to apartment buildings or other income-generating real estate.
AcreTrader’s founder set up a management entity that buys individual farms, but only after a thorough due diligence process that accepts less than 1% of applicants. Then AcreTrader offers investors the chance to buy shares that equal 1/10th of an acre in the offering, which means that investors who buy 10 shares own a full acre of the farm.
The farm itself is managed by AcreTrader’s team, who takes care of it from top to bottom. Its management includes everything from paying insurance premiums, farmer relations, and even keeping a watchful eye on soil sustainability. Then these farms are rented out to individual farmers (or larger farming operations) that pay cash upfront to lease the land.
The up-front lease arrangement means the dividends for shareholders are not dependent on external factors like crop yields or favorable weather conditions. AcreTrader collects a flat rent from the farms and pays out shareholder dividends every December.
Whenever it comes to investor fees, the lower and more straightforward they are, the better. AcreTrader charges an annual flat fee of 0.75% of the individual farm’s value against the annual income generated by the farm. That fee is then split on a pro rata basis among the shareholders based on how much acreage they own. It really doesn’t get any simpler and more concise than this when it comes to fees. The fee is reasonable and very easy to understand. That’s why AcreTrader gets a strong 4.5-star rating.
Most companies that go through the trouble of setting up an online investment platform know that investors won’t trust a platform that’s hard to use or understand. Acretrader certainly fits into that “most companies” category. Its platform is straightforward and easy to use.
Signing up is a breeze, and Acretrader deserves a tip of the cap for enabling sign-ins through Google (NASDAQ: GOOGL) or other social media accounts. After all, the fewer passwords one has to remember, the better. In a nod to security, Acretrader also allows members to select a 2-factor authentication process, another thing that earns it high praise.
After signing up, you take a brief survey and verify your accreditation status before being able to actually buy shares. The entire process is pretty simple, and even investors with minimal computer literacy can walk through it. Browsing investments is easy, and the platform puts all the relevant information right at the top of the page. This set-up will be especially comforting to anyone who is new to farm investing.
Investor education is mission-critical for any online investment platform, and that goes doubly so for a platform that trades in non-traditional investments like AcreTrader does. It is very clear when you use AcreTrader that the company founders get this, and deserve credit for designing the site accordingly. For many AcreTrader investors, this platform represents their first foray into buying farmland as passive income.
It’s encouraging to see a Resources tab at the top of AcreTrader’s landing page. Better still is the fact that the second tab under this resources page is titled “How it Works.” Potential investors will be welcomed with a short video explaining the history of farmland as an investment and why buying it works as an investment. Right next to this video is a tab titled “Reach Out” that takes investors to an email query section where they can ask and then get answers for any questions they have that are not explained in the video.
Investors who like what they see in the video can scroll down further and get a complete primer on how AcreTrader works, when it pays dividends, and how their money will be safeguarded. All of this information will be reassuring to potential investors.
Additionally, the “Learning Center” tab includes a vast wealth of information in the form of excellent articles written by AcreTrader staff. The valuable content there is in stark opposition to many sites that put out generic “learning content” that hardly rises above the level of “meh” when it comes to quality of information.
The “Farm Value” tool is a unique simulator that allows investors to plug in zip codes to view the average price per acre and annual return by state all across America. Add that to a solid frequently asked questions (FAQ) page, and the end result is a robust investor education section.
Again, this level of investor education is a must for an alternative platform like AcreTrader, and the site deserves plaudits for delivering.
AcreTrader is very discerning about accepting applications from farms to appear on the platform as an offering. In fact, the AcreTrader due diligence is so rigorous that less than 1% of farms that apply will have their application approved. As a result, new offerings are typically funded within hours or days, meaning there aren't always available opportunities. However, the platform typically adds a new offering each week.
Its upcoming offering is a soybean and cornfield farm in Illinois with a $11,990 buy-in and a targeted 7.6% net annual return. That’s not too different from the net return one might expect on a well-managed apartment building or high-performing REIT. More offerings would be better, but all things considered, the current offering is certainly worth a long look.
AcreTrader brings an incredibly unique focus to online investment platforms, and it deserves a lot of credit for that alone. Overall, AcreTrader makes a compelling case for farmland as an alternative investment, and the user-friendliness of the platform only encourages potential investors to dive in. The platform’s admirable investor education efforts also work strongly in its favor.
Perhaps the only question about AcreTrader is whether the investor community outside of the heartland is ready to buy into farmland. One thing is for certain, if you are looking for an alternative investment and decide to buy farmland, AcreTrader is a great place to do it. It’s a good platform with a good concept. The verdict: 4 stars
AcreTrader Returns
AcreTrader is a relatively new platform, so new in fact that most of its closed offerings have not reached the end of their hold periods. That means there isn’t any historical data on returns for an entire deal cycle. With that said, AcreTrader targets an internal rate of return of 6% to 10% per year on annual crops (wheat, corn) and 6% to 14% per year on permanent crops (almonds, apples). To date, AcreTrader has also made 500 investor distributions that were above the predicted yield. It will be interesting to see what the returns are on full deal cycles. Until then, there isn’t enough information to make a grade here.
Frequently Asked Questions
Who is the founder of AcreTrader?
Carter Malloy is the founder and CEO of AcreTrader. He established the company in 2018 to make farmland investing more accessible to individual investors.
How much does AcreTrader charge?
AcreTrader typically charges two main types of fees – annual management fee of 0.75% and a one-time upfront fee of 2–5% of the investment amount.
What is the minimum investment on AcreTrader?
The minimum investment on AcreTrader varies by offering but generally starts at $10,000 to $15,000. Most listings require an initial investment between $15,000 and $40,000, reflecting the cost of acquiring 1 to 5 acres of farmland, depending on the property’s price per acre. Some offerings may have higher minimums, up to $100,000, while a few past deals have been as low as $3,000
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About Eric McConnell
Eric McConnell is a real estate writer with a years-long passion for the real estate industry and the desire to help everyday people learn more about real estate investing. He is a graduate of Pepperdine University, where he earned a BA in journalism.
After graduating, Eric embarked on a career in real estate where he spent over a decade as an agent for multi-family and commercial properties in Los Angeles. In his career, he’s worked on almost every side of a real estate transaction. He has represented buyers, sellers, property owners and renters and served as manager for commercial and residential properties.
In 2019, Eric started sharing his experience with the wider world as a writer. He got his start writing and editing real estate lessons for prospective licensees before joining Benzinga in 2021. Since then he has written a variety of real estate material ranging from investment platform reviews to covering and analyzing breaking news in the real estate industry. His work has been published by Yahoo News on numerous occasions.