George Bravante on Agricultural Investing and The Top 5 Markets to Target

Brian welcomes George Bravante, a private equity investor focused on acquiring and operating farming assets in the Central Valley of California. In this episode, George talks about the region's importance for the US food supply and the Sigma Law passed in 2014 that regulates sustainability and has led to restrictions on some farmers. He believes that despite these restrictions, there is potential for consolidation and monetization of this opportunity set through investments in citrus crops. George also discusses his commitment to caring for his partners' money from his upbringing in a lower-middle-class family. Finally, he outlines how certain factors such as tariffs, crop abundance, inflation, consumer demand, and organic food affect the agricultural industry. [00:01 - 08:18] Opening Segment50% of the US's food comes from California, including the Central Valley and Salinas AreaClimate change is impacting production in Florida, which used to be a significant engine for US agricultureCalifornia passed the Sigma law in 2014, giving the state the right to regulate sustainabilityCalifornia provides half the produce in the country, and this may go down due to Sigma law[08:19 - 15:49] California Farmers Face Crisis as Infrastructure is Destroyed and Water Supply DecreasesGeorge shares how infrastructure is being destroyed due to soil settlingThe investment strategy is to buy ranches and focus on citrusTargeting 8-12 year return with Sigma will value[14:50 - 24:10] A 16-18% Return Over 10 Years with a Vertically Integrated StrategyThe competition landscape is institutional equity getting into the spaceThe industry will consolidate as far as the eye can seeThe importance of being committed to taking care of your partner's money[24:11 - 32:20] Exploring the Benefits of California's Central Valley Production HubCentral Valley of California is a unique place to grow produce due to its climate and water supplyThe rise of the middle class in Southeast Asia has led to an expectation of 24/7 availability of fruits and vegetablesAgriculture is seen as an inflation hedge, but prices have been hurt by Covid and shipping costsOrganic sales have fallen due to people not willing to pay the premium during tough times[32:21 - 33:32] Closing SegmentFinal wordsConnect with George through the links belowQuotes:"Agriculture is a very cashflow intensive business. It doesn't trade on cap rates. It trades per acre, so it's inefficient. And the reason is that one guy's better than the guy next to him." - George BravanteConnect with George!Website: https://bravantefarmcapital.com/ Download our FREE Strategizing for Inflation Guide here: https://www.excelsiorgp.com/download/Connect with me on LinkedIn!LIKE, SUBSCRIBE, AND LEAVE US A REVIEW on Apple Podcasts, Spotify, Google Podcasts, or whatever platform you listen on. Thank you for tuning in, and Stay Tuned for the Next Episode COMING SOON! Hosted on Acast. See acast.com/privacy for more information.