Title

Presentation

David Gladstone – CEO & President:

Michael LiCalsi – General Counsel:

Lewis Parrish – CFO:

Operator: Greetings and welcome to the Gladstone Land Corporation’s First Quarter Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce David Gladstone, Chief Executive Officer and President. Please go ahead.

David Gladstone: Okay, Paul. Thank you for that nice introduction and this is David Gladstone and welcome to the quarterly conference call for Gladstone Land. Thank you all for calling in today. We appreciate the time it takes to listen and talk to you and thank you for listening to our presentation. Before I begin, we’ll start with Michael LiCalsi, he’s our General Counsel. Michael?

Michael LiCalsi: Thanks, David. Good morning, everybody. Today’s report may include forward-looking statements in the Securities Act of 1933, Securities Exchange Act of 1934, including those regarding our future performance. These forward-looking statements involve certain risks and uncertainties that are based on our current plans, which we believe to be reasonable. The main factors may cause our actual results to be materially different from the future results expressed or implied by these forward-looking statements, including the risk factors in our Form 10-K and 10-Q of the documents we filed with the SEC. You can find them on our website, gladstoneland.com, specifically the investors page on the SEC’s website, sec.gov, and we undertake no obligation to publicly update or revise any of these statements, whether a result of new information, future events, or otherwise, except as required by law.

Today, we will discuss FFO, which is a non-GAAP accounting term defined as net income excluding the gains or losses from sale of real estate and the impairment losses from property, plus depreciation and amortization of real estate assets. We’ll also discuss core FFO, which is generally FFO adjusted for certain non-recurring revenues and expenses, and adjusted FFO, which would further adjust core FFO for certain non-cash items, such as converting GAAP rents to normalized cash rents. We believe these are better indications for better operating results and allow better comparability for our period-over-period performance. And please visit our website, that’s gladstoneland.com. Sign up for our email notification service. You can also find us on Facebook.

The keyword there is the Gladstone Company, and on X, formerly known as Twitter. Our handle there is @gladstonecoms. Today is an overview of our results, so we ask that you review our press release and Form 10-Q, both issued yesterday, for more detailed information. With that, I’ll turn it back to David Gladstone.

David Gladstone: Thank you, Michael. I’ll start with a brief overview of our farmland holdings. We currently have about 103,000 acres, and they’re on 50 different farms and about 55,000 acre-feet of water assets that we hold as well. One acre-foot is equal to about 326,000 gallons, so if you multiply that out, we own about 18 billion gallons of water. And that’s very good because the west can be dry, but we’re in good shape today. Our farms are in 15 different states, and more importantly, they’re in 29 different growing regions, and all our water assets are in California. Our farms are leased to over 80 different tenant farmers, and the tenants on these farms are growing 60 different crops, so we’re highly diversified. Most of our crops are fruits and vegetables and nuts, and these are the healthy things that people should be eating.

You can find those in the produce section of the grocery store, which is where most of the crops grown on our farms are sold. As we mentioned in previous calls, we continue to be cautious with new investments because interest rates and our cost of capital remain very high, and cap rates on row crops and farmlands are just too low to be something that we can do in buying more farmland, which remains very high value, and interest rates and all the inputs to farming are very expensive these days. And we also believe in a good time to conserve cash, given the uncertain times that we’re all living in today. Regarding leasing activities, so far in 2025, we executed seven new leases or amended some existing leases, mostly on the permanent crops out west.

On one of these leases, we adjusted the lease to structure in a similar manner to what we’ve done on a few other farms, and that is we’ve reduced or eliminated the base rent, so we’re not being paid on a monthly basis, and in some case, provided the tenant with a little bit of cash to grow the crops on the farms. So the operating and capital costs are taken by us. In exchange for that, we significantly increased the participation rent component in the lease. The majority of which, unfortunately, will be recognized in the fourth quarter when we harvest the crops. So we’re in the growing business with those eight farms that we’ve got. I want to touch a little bit more on this. As I mentioned in prior calls, market conditions around many permanent crop farms in the west, particularly those growing nuts and grapes, have been hampered by lower crop prices and higher inputs and borrowing costs.

As such, we decided to adjust the lease structure on six properties to help the grower minimize their fixed costs, but also allow us to participate in the upside. In essence, we’re accepting a percentage of the gross crops that are for sale, and instead of those rent payments that we normally were getting. We also decided to operate two properties ourselves with the help of a third-party operator. So the third-party operator is growing, and we’re covering some of the costs. We assume the worst-case scenario, and if we do, everything just doesn’t work out our way. And for example, if we had total crop losses because of some crazy atmospheric thing, then we expect the crop insurance that we have on this to be enough to cover all of our costs and also provide us with a small profit.

Now, we don’t want, nor do we hope that we have to use that, but I can’t talk at this point. My wife just called me. Let’s see what’s going on here. I’m on a call. I’m sorry. Of course, our hope is that we have a good production on all of these farms so that we don’t need to rely on crop insurance, in which case it could be significant. We just don’t know and won’t know until the fourth quarter when we actually sell the crops. We’ve been seeking positive movement in terms of pricing for almonds. We’re seeing that happening now, and pistachios are doing well. And this is supposed to be a good year in terms of production. So we’re hopeful of a strong turnout when we gather this information in the fourth quarter, but we really won’t know much about it.

We’ll give you progress reports as we go along when we find out what’s going on in the farms. Our current plan is to move forward with this structure for 2025 and harvest these eight farms that way. Then hopefully we’ll revert back to more traditional lease structure next year. Or we may look to sell some of these properties that we have, and the six leases we executed so far this year are expected to result in a year-over-year decrease in our annual NOI, but we’ll see what that looks like at the end of the year. So pretty flat year. Looking ahead, we’ve had 16 lease schedules to expire throughout the rest of 2025, and due to some of these leases containing no fixed rent base and others including cash leases, both in exchange for increase in participation in the rent component.

These leases actually account for negative $1.1 million of lease revenues during first quarter of 2025. So we’ve given up some straight-line income, and largely because we want to participate in the resulting from these leases. And again, I’ll say it, we won’t know much about it until the fourth quarter, and we’ll get our report card, so to speak, as we sell all the things that they’re growing on the farm. We’re in discussion with some current tenants and prospective new tenants about leasing these farms, including reverting some of these leases back to standard leases with fixed base rents. Or if we’re unable to do, come to terms on some of these leases, most likely we’ll sell a couple of these farms. We believe we have some very valuable farms for selling as always, and selling is always an option.

And now I’ll give a quick update on some of the remaining tenant issues that we have. We currently have five farms, that’s part of the eight that are vacant, and two properties and companies, four farms that are direct operating. So we’ve got eight of these properties that we’ve gone from having fixed rent leases into participation leases. And we’re recognizing revenues from the leases with three tenants who are collectively leasing five of our farms on a cash basis. Regarding these farms, we’re in discussions with various potential buyers and tenants to buy or lease these properties. And we hope to get these remaining issues resolved later this year. And if we’re unable to come up with an acceptable resolution by the year end, probably be listing some of these farms for sale.

And just note on tariffs, which everybody’s talking about these days. Most fresh produce such as berries and vegetables are somewhat insulated from the impact of tariffs, because due to a strong domestic consumption, we’re just selling those to other Americans. The nut sector, on the other hand, is vulnerable because 70% or so of U.S. grown almonds and pistachios are exported annually. They box them up in boxes and ship them out. And China has in the past done a significant portion of those. It’s down substantially now, and we have other countries that are more involved in buying our almonds and pistachios. Before the tariff announcement, almond prices had risen significantly year over year, and pistachios remained stable, well without slightly.

While the full impact of tariffs on pricing is still unfolding, we’re continuing to monitor the situation. In response to previous rounds of tariffs, China shifted much of its almond demand to other countries, and it has also reduced its imports of U.S. pistachios due to more recent tariffs. As a result, some of the largest importers of U.S. almonds and pistachios are now in India, the European Union, and in Turkey, none of which have announced any tariffs on the U.S. goods. These demand shifts could help stabilize prices for U.S. nets, although market dynamics are still evolving. As they always do, this is not an exceptional year. It’s just a straightforward year in that regard. Another factor impacting export demand is the weakening of the U.S. dollar.

As the dollar gets weaker against other currencies, say the EU for example, the global market helps mitigate any of the negative impacts from tariffs. At this point, I’m going to turn it over to Lewis. And Lewis, of course, will go through the numbers. Go ahead, Lewis.

Lewis Parrish : All right. Thank you, David, and good morning, everyone. I’ll begin with our financing activity. In connection with certain property sales, we paid off about $19.5 million of loans that were scheduled to reprice at market rates later this year. We did not borrow any new money or issue any equity during the quarter. So we’ll move on to our operating results. For the first quarter, we had net income of about $15.1 million, and net income to common shareholders of $9.1 million, or $0.25 per share. Adjusted FFO was approximately $2 million, or $0.06 per share, compared to $5.1 million, or $0.14 per share in the same quarter last year. Dividends declared per common share were $0.14 in both quarters. The year-over-year decrease in FFO was primarily driven by recent changes in lease structures on certain farms and certain tenancy issues that resulted in farm vacancies, leading to reduced revenues and higher costs, as well as lost revenues from farms sold over the past year.

Fixed base cash rents decreased by about $5.7 million compared to the prior year quarter, due to the reasons just mentioned. Again, primarily the vacancies we continue to work through, and structural changes made to certain leases, reduced or eliminated fixed base cash rents, or in some cases, provided cash lease incentives to certain tenants in exchange for significantly increasing the crop share components in the leases. And as David mentioned, the results of these crop share components will not be known until the harvest is completed later this year. The decrease in fixed base cash rents was partially offset by a $2.4 million lease termination fee we received from an outgoing tenant who previously leased three of our farms, along with about $465,000 of participation rents recorded during the current quarter, primarily due to cash collected on the wine grape sales.

And we mentioned this on the past couple of calls, but with a few additional agreements now in place, I think it’s worth providing an update to the numbers. As a result of the change in lease structures we made on some of the farms, we are expecting a total year-over-year decline of about $17 million in our fixed base rents for fiscal year 2025 compared to ‘24. This figure consists of the base rent that we recognized last year under the prior leases, plus the cash allowances granted to certain tenants for the 2025 crop year. This will be shown as a reduction in our fixed base rents at a rate of roughly $4 million to $5 million per quarter in 2025, which is consistent with the impact we saw in the first quarter here. And in turn, we expect most of the resulting crop share proceeds from these leases to be recognized as participation rent in the fourth quarter of 2025, with the remaining smaller portion to be recognized in the second half of 2026.

So in essence, we’re shifting this revenue from fixed base rents to participation rents over the next couple of years. As a result, we expect earnings this year will be more heavily weighted towards the fourth quarter, with lighter earnings coming through the first three quarters compared to prior years. On the expense side, excluding reimbursable items and certain non-recurring or non-cash charges, our core operating expenses increased by about $365,000 during the current quarter. Regarding the related party fees, excluding a capital gains fee that was triggered by recent sales, total related party fees decreased by about $60,000, driven by a lower base management fee due to recent farm sales. The capital gains fee is not payable until after the end of the fiscal year and remains subject to adjustment throughout 2025 based on future asset sales or dispositions, so it’s been added back to AFFO for the time being.

Our remaining core operating expenses increased by about $425,000, which is primarily due to additional property operating expenses associated with farms that were either vacant, direct operated, or non-accrual status. This included additional property taxes, which were previously the responsibility of prior tenants, as well as additional legal fees related to leasing activity, establishing direct farming operations on certain farms, and protecting water rights on certain farms in California. Finally, our other expenses decreased mainly due to reduced interest expense and preferred dividend payments, driven by loan repayments and preferred repurchases completed over the past year. Turning to liquidity, including availability on our lines of credit and other undrawn notes, we currently have access to over $180 million of capital, including about $40 million of cash on hand.

In addition, we have nearly $150 million of unpledged properties. Over 99.9% of our borrowings are fixed rates, with a rated average rate of 3.41% locked in for an additional 3.4 years. As a result, our operating results have experienced minimal impact from rising interest rates over the past few years. And we believe our current borrowing structure provides strong protection, should interest rates continue at elevated levels. Looking at upcoming debt maturities, we have about $28 million coming due over the next 12 months. Of that, roughly $11 million consists of individual loan maturities, and given the value of the underlying collateral, we do not anticipate any issues refinancing these loans if we choose to do so. So excluding those maturities, we have about $17 million of scheduled principal amortization coming due over the next 12 months, representing less than 4% of our total debt outstanding.

In addition, we have about $7 million of loans with fixed rate terms that are set to expire within the next year, though the loans themselves are not maturing. Finally, regarding our common distribution, in April, we declared a monthly dividend of $0.0467 per share for the second quarter of 2025. Based on our current stock price of $19.65, this equates to an annualized yield of 5.8%, which is above the average dividend yield across the broader wheat sector. We’re holding the dividend at its current level for now, and we will continue to evaluate it as more information becomes available regarding the 2025 harvest. With that, I’ll turn the program back over to David.

David Gladstone: Okay, thank you, Lewis. Nice report. We continue to stay active in the market, should a good acquisition opportunity come along. So we’re ready if interest rates come down, because there’s no use buying it unless you have low-cost capital. But as mentioned on prior calls, we’re still being more cautious on the acquisitions front because our cost of capital remains very high. And while we have seen decreases in pricing for certain permanent crops and farms out west, the value of most row crop farms, like those growing strawberries, remains high, and cap rates on most of those farms are just high enough to make financing cost worrisome for people who are growing those crops. So as a result, acquisition activity remains slow to none for us, and probably will for at least the next 12 months.

Interest rates are still very high, and banks are charging very high prices, and that’s very bad for farming, especially for farmers who are borrowing money to plant their crops and also to harvest their crops. It’s getting reduced or pushed further out, so the amounts of timing of any additional rate cuts remains uncertain. We just don’t know what the Federal Reserve is going to do. And they almost dictate straight through to all the federal banks that we have our loans with. But we do hope that rates will come down from some points in the near future, so that we can start looking and buying more farms again. And just a final point, excuse me, I have a frog in my throat. We believe that investing in farmland growing crops that contribute to a healthy lifestyle, such as fruits and vegetables and nuts, follows the trend that we’re seeing in the market today.

Overall demand for the prime farmland growing berries and vegetables remains stable to strong almost all areas where farms are located, particularly both of those east and west coast. As mentioned earlier, crop prices of certain permanent crops, such as nuts and wine grapes have been depressed lately, which has impacted the value of our underlying farmland. Please remember though for this company, and I guess for all companies for that matter, purchasing stock in this company is a long-term investment in farmland. Historically speaking, long-term returns remain strong over time, but there are occasionally some ups and downs as it has been for the last year and a half since the pandemic. Right now there’s a portion of our portfolio that’s in a down cycle, as we call it, and we’re working hard to maneuver through it.

We expect inflation, particularly in the food sector, to continue to increase over time, and we expect the values of the underlying farmland to increase over time, as they have mostly in the past. We expect this especially to be true of fresh produce in the food section and the trend of more people to eat those foods rather than some of the bad foods that are out there. Now we’ll have some questions from those who follow us and operator, Paul, would you please come on and tell them how they can ask a question?

Operator: Thank you. We’ll now be conducting a question-and-answer session. [Operator Instructions] Our first question is from Gaurav Mehta with Alliance Global Partners.

Gaurav Mehta : Thank you. Good morning. I wanted to clarify your comments around $17 million of lower revenues in 2025 versus 2024. It seems like a higher number than I think $13 million that you guys mentioned on the last call. So were there any more farms added to the participation rent structure that increased that number for 2025?

Lewis Parrish : Yes, there was one additional farm that we executed a new lease on where we gave the tenant a lease incentive. And there was one farm, one property that we took over to be direct operated. So the lost revenues that were recognized last year from those two farms were added to that as well as the lease incentive we gave one tenant.

Gaurav Mehta : Okay, and so in terms of the total participation rents that you guys expect in ‘25, so that’s $17 million plus some additional number as well based on last year’s run rate?

Lewis Parrish : Yes, so as David said, the eight properties that are kind of in this bucket of having a lease incentive or being direct operated, we do expect to make all of that $17 million back and insurance should cover that number plus a little bit of a profit. Of course, we’re hoping not to have to use it and to be able to show a higher profit, but the split of the revenues coming will be between Q4’25 and Q4’26. If we had a guess, maybe we’ll get between 60% to 70% of that this year and then the remaining amount will be in Q2’26, second half of Q2’26.

Gaurav Mehta : And so in addition to 17, I think last year you had $9.4 million of participation rent, so it’s going to be last year’s run rate plus additional 17, right?

Lewis Parrish : Not exactly. Because some of those, some of that participation rent came from farms that are now in this adjusted lease structure, if you will. So that $9.4 million would probably be a little bit lower this year and then add the $17 million plus any profit we’re able to generate on these farms for the current year.

Gaurav Mehta : Okay. And then lastly, the $2.4 million termination fee, can you provide some color on that farm?

Lewis Parrish : Yeah, so those were just three almond farms that 110 leased and those three farms are vacant now. We got a termination fee for letting them out of certain lease obligations and one-time event. Of course, we won’t get that again, but we are working through a variety of options on those three farms to get income coming in on those farms again.

Gaurav Mehta : Okay. Thank you. That’s all I have.

David Gladstone: Okay. Next question, Paul.

Operator: Our next question is from Rob Stevenson with Janney Montgomery Scott.

Rob Stevenson: Good morning, guys. How should we be thinking about additional sales here in the second quarter and going forward throughout 2025? It doesn’t look like that there’s anything held for sale at March 31st.

David Gladstone: No, we have some farms that we listed for sale, but we don’t have any contracts that we want to execute on.

Rob Stevenson: Okay. And then the five assets that are vacant now, I assume that that’s the three almond farms plus two others there. How are those being looked at right now? Are the other ones vacant? Is there stuff planted on there that you guys are taking care of on your own? Are they just raw land? How should we be thinking about that and the ability for that to be somewhat of a kicker later on this year?

Lewis Parrish : So two of them are open ground. Nothing is planted on this. So it’s pretty low cost to keep those going. It’s just their real estate taxes, which are pretty low on those. And the other three on the properties, these trees are at the end of their life, so they will be pulled out eventually. But as far as maintenance costs, it’s also just the real estate taxes on those three farms that we’re having to bear at the moment. We have several different options that we’re kind of evaluating for each of these. We could be entering into fouling programs, leasing off water rights, looking at potential new crops to plant there, which crops make the most sense in these regions with the water availability, market demand, tenant demand.

But nothing is in stone yet. We’re kind of in the process of throwing around a few different options and seeing which makes the most sense. Hopefully, we’ll get a few of these turned into income producing properties through the end of the year, but a couple of them could swing into next year as well.

Rob Stevenson: Are the almond farms close enough to population areas where it could make sense to sell to a home builder?

Lewis Parrish : Not at this time. We don’t think now.

Rob Stevenson: Okay. And then, David, last month, the common stock went below $9 for the first time since 2016. How are you and the board thinking about possibly repurchasing shares, especially with the asset sales in the first quarter and some cash on the balance sheet if the stock continues to be cheap in the sub-$9.50 range?

David Gladstone: Yeah, it’s always difficult. We are right now harboring cash, and the reason we’re doing that is the worst nightmare is you have something come due and don’t have the cash to pay for it. That’s what we never want to do. And so, we’re making sure that we’re in a position to borrow more money. All of our banks are telling us, please take down our money. And our statement, of course, is reduce the interest rate and we’ll take it. But right now, the farming area is kind of locked up tight. Not many people doing things, mainly because interest rates are too high. And while we don’t think about it that way, farming is a situation in which you need to be able to borrow money to harvest and borrow money to plant. And we just don’t want to get in a situation where we can’t have crops come for our way during the next year.

And so, I’m a little bit skittish on using my cash. And my CFO, he’s looking at me saying, let’s spend some money. But we could buy back preferred stock and make a lot of money for our stockholders, but you have to give up the liquidity. And I’m just not willing to do that. So, we’re going to remain highly liquid for at least the rest of this year. And we’ll have to see how well we do. If we do extremely well at growing in these growing situations and make a lot of money, that might change my mind. But we won’t know that until probably toward the end of this year. So, you’re right. We could make a lot of money and make our shareholders happy in the short term. But if we run into that brick wall of not having money to do things, then the game is not over, but it’s really hurt.

And so, Rob, we’re sticking with the idea of having enough money to do all the things that we need to do in order to be a farmer. And I’ve had some real good friends in the farming business that have just had to quit because they ran out of money. So, we’ve got to keep ourselves highly liquid in paying our dividend. And hopefully, when we cash in these crops that are growing, and right now they seem to be very good, but at the end of the day, you don’t know until it happens. And so, we’re going to keep going and doing what we’re doing, which is being highly liquid and taking care of our existing company. And some people just don’t believe in us and can’t blame them. It’s been tough for all the farmers since the pandemic that happened and really shut down the farming business for anything other than very stable crops.

We are just going to continue to muddle our way through this and hopefully our bet on the crops in the ground. And all of these are not things that we’re planting. They’re trees that are already growing. So, we’re just taking care of the trees. And at some point in time, you’ll know, you’ll hear us singing a good song down here about how well things went. That’s where we are. I hope that’s okay for you.

Rob Stevenson: All right. Thanks, guys. Appreciate the time this morning.

David Gladstone: Okay. We have another question.

Operator: Our next question is from John Massocca with B. Riley Securities.

John Massocca: Good morning.

David Gladstone: Good morning.

John Massocca: So, maybe with that kind of cash balance in mind, how are you thinking about, I mean, relatively limited debt maturities for the remainder of 2025. But you do have that term preferred out there at the beginning of ‘26. How are you thinking about financing that? I mean, is that something you could take out with additional asset sales? Would you potentially use some of the — maybe kind of runway you have in terms of taking on more leverage to take that down? Just kind of curious your thoughts about that particular instrument.

David Gladstone: Well, we planned it out and we are going to make the payment. Not worried about that. But the question is always how you do it. And if we use our cash, we lose some liquidity. We’ve got these banks that want to lend us money, but their prices are still high. So, we’re kind of sitting between those two decisions and trying to figure out which is the best way to go. We’ll go through it. We’ve got plenty of room to do it. It just means that we’re pushing out the answer to the question of these eight farms for another year or two years. I don’t want to do that. I’d rather get back to leasing farms and letting the farmer make the big dollars rather than us putting up some money and making the big dollars. I don’t like the growing side of the business.

I do love the leasing side of the business. So, we’re just going to keep doing that and hopefully things will work out. Right now, it looks extremely good. Projections for the farms are following exactly what we thought. We’re still in good shape. So, we’ll let you know if anything happens. But I hate to see the people out there selling their shares because I think we’re going to do well for the year.

Lewis Parrish : John, regarding your question about the Series D term preferred stock, $60 million and change coming due in January of 2026. We’re talking through a few options. It’s likely, not guaranteed, but it’s likely we’ll have a couple more farm sales. So, that’s more cash on the balance sheet that could be used towards it depending on what interest rates are closer to that time. We could go that route. We have been talking with banks to refinance that. But as David said, the price for that is high. Honestly, it’s not too much cheaper than the option that would result if we just let it sit out there. The coupon would go from 5% to 8%, not something we want to do, but the current refinancing cost is not a whole lot cheaper than that.

Of course, you have a lot of upfront commissions and costs involved in that transaction as well. So, we have a few different options that we’re looking at, but it’s too early to make a decision on which route we want to go, but it is in the forefront of our minds.

John Massocca: As a reminder, how long could that sit at 8% if you decided to just let it roll forward?

Lewis Parrish : Forever. It turns into perpetual —

John Massocca: Perpetual. And then, kind of bigger picture, how are you thinking about the bank’s groundwater, both in terms of maybe adding to that and what you have currently tucked away. Just given where kind of market dynamics are? I mean, right, it’s kind of a security policy with kind of traditional drought in some of these western markets, but we’ve had some wetter winters. So just curious kind of your thoughts about your bank’s water holdings, adding to it, you’re selling out of it, et cetera.

David Gladstone: Well, we have one situation in which we’re probably going to add to it. Right now, we have enough water to do whatever we want to do this year unless everything’s turned just totally against us. But I think we’re in great shape. And I think the water situation is going to be good for us. All of that water is in the ground, and we get our name on it, and we pump it out whenever we need it. We haven’t needed any of that water so far. It’s been a relatively wet year, and I don’t think there’s going to be much change, but the weather can blindside you easily by coming in really strong. And we had so much water come in. The amount of snow that’s in the mountains that will melt this summer is better than it was last year.

So, this year should be a good year. And I don’t worry about water nearly as much as I worry about what the Federal Reserve is going to do with interest rates, because with interest rates high. I mean, we borrow money at 3%, and most of our long-term debt is at 3%. So, it would be nice if we could go back to that level. And this is farmland lending, and we don’t have any problem with the lenders. The lenders are willing to lend. It’s just they can’t lend much below what they’re being charged by the Fed and by the government. So, if you’ve got any strings to pull, pull them in for the Federal Reserve, because all the farmers need help this year and in the future. It’s very expensive to borrow 8% money and use it to plant crops. So, everything is pretty much stalled.

There are a lot of people who would like to sell their farms, and I would love to buy them because prices are good, but at the same time, you can’t borrow it. You’d need an enormous amount of equity in order to wade into the marketplace today.

John Massocca: Okay. That last comment in mind, it’s on a very specific level. Are you seeing anything loosening up in terms of transactions in the California kind of permanent crop market? It seems like that was kind of stuck, given some of the prices of tree nuts over the last couple of years, but anything kind of opening up a little bit here as operators have kind of digested the distress of the last couple of years?

David Gladstone: Well, prices for almonds, for example have come up substantially from last year. And pistachios seem to be holding their own and making money for people that are farming those. We do have some wine grapes, and that’s not a good market to be in right now, but we’re getting along. And I think for us, as long as the pistachio market is good, we’re going to be fine.

John Massocca: Would you look at that market kind of got a little better? Would you like to sell any of your assets in that kind of specific area?

David Gladstone: Yeah, we’ve talked to a lot of brokers. Unfortunately, the past two years have been really bad for farmers. And there are a lot of farms for sale. We’ve seen bankruptcies right and left, farmers who were too highly leveraged and couldn’t make their payments, so the banks end up with those. And we could get some great deals if we had cheap money to buy it. I’m not going to go down that path. We’ve got enough money to do what we need to do for the next years. And I think we’re just going to stay and keep doing what we’re doing, which is pretty boring for everybody except, I guess, people who are hoping that our stock will go down even further. So other than that, we’re in good shape.

John Massocca: Okay, that’s it for me. Thank you very much.

David Gladstone: Okay, Joe. Anybody else? No other questions? Well, I hate to say it and leave it where it is, but we don’t have any better information for you. So as a result, we’re going to close it out and see you next quarter. We’ve got the money to go the next quarter and the quarter after that and even the quarter after that. And as long as we don’t have complete disaster like they have in 2009 that would be able to just stick around and wait it out. And if we hit the ball out of the park, as we hope to do with our eight farms, we’re going to be able to say some nice things to you next time. So that’s the end of this call.

Operator: This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.