MONETTE FARMS land parcels for sale

[Taiga]

My opinion, it only affects land values in areas they were buying/operating in. They are not near me and still basically nothing is for sale here, with lots of demand. It’s still cheap here in relation to other areas.

[AlbertaFarmer5]

My opinion, it only affects land values in areas they were buying/operating in. They are not near me and still basically nothing is for sale here, with lots of demand. It’s still cheap here in relation to other areas.

Unless the banks get spooked.

[Taiga]

I guess but banks will always have to do their due diligence and make sure buyer/lendee is qualified

[AlbertaFarmer5]

As long as I have been borrowing money to buy land, the banks have told me that land is the riskiest asset compared to any other real estate or asset.
Higher interest rates, much higher down payments, higher credit ratings required.

And if anything, it is only gotten worse in recent times. Some banks are now requiring 50% or more down on bare land.
So how did this outfit convince creditors to loan them that much money on mostly bare land?

I've never dealt with FCC or afsc, is it different, will they loan money based on a business plan rather than money down and equity?

[farmaholic]

I think a lender told me once that interest rates on farmland mortgages is higher than house mortgages, because repossession is more arduous for farmland.
Or was it machinery compared to houses?

LEP????

[LEP]

Land foreclosure is slowist, then farm equipment, then house, then car or commercial equipment.

House mortgages have insurance available to reduce lender's risk but at a significant cost to the borrower. Lowers lender risk so cheaper interest rates.

FCC definitely plays by different rules than the bank. They can offer a 10 yr fixed rate and will lend up to 80% of the land value.

Banks also rate risk alittle differently. Or I should say they used to. It's been 28 yrs since I was in the system.

Many changes since then.

[LEP]

Monette is getting free land for this year curtesy of bankruptcy law is what that letter says. Don't dare lock the gate and rent to another or the secured creditors lawyer be calling. All cash going to secured creditors. Wonder how they will keep the wheels turning access fuel and fertilizer? Bottom line this is saying that land value are going despite nobody believing they can no more.

What I find interesting is the timing of it all. Just seems to be rolling in slow motion. I would have thought after the land sales process was mostly a failure, that the plug would get pulled.

Unless ... and this is completely speculation, unless it is investors that are making the move and not the lenders. But it is equally bad timing for them to pull the plug.

If atleast some of the inputs haven't been bought there will be NO economies of scale.

[shtferbrains]

Bank never have foreclosed on land?
Even in the 80's they renegotiated or what was called "quit claimed"?
They don't want to erode the value of their collateral on the whole farm economy?

Have to think there is a lot more than this 1 case going on that haven't come out in public?
Banks want to reduce their exposure .
New policy?

[LEP]

What I find interesting is the timing of it all. Just seems to be rolling in slow motion. I would have thought after the land sales process was mostly a failure, that the plug would get pulled.

Unless ... and this is completely speculation, unless it is investors that are making the move and not the lenders. But it is equally bad timing for them to pull the plug.

If atleast some of the inputs haven't been bought there will be NO economies of scale.

I found an answer of sorts. RealAgriculture is reporting that Monette had a syndicated loan in the amount of $950 million that expired April 15, 2026 and wasn't renewed.

So that explains the timing.

[sumdumguy]

[QUOTE=LEP;n833164]

I’d imagine there are many small creditors not accounted for on bank debt. Hopefully I am wrong.