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Majority of farm assets will be inherited

 

A farm consultant believes farm real estate ownership will undergo a major change in the next decade.

“With about $3 trillion in agriculture assets in the country, over the next 10 to 15 years, a tremendous amount of that wealth is going to be changing hands and about 70 percent of that wealth is tied up into farm real estate.”

Mike Fassler with the Family Business Consulting Group tells Brownfield nearly two-thirds of farm owners are 55 and older and while they might be preparing to pass farmland onto the next generation, the current economic environment could delay the transfer.  “Real estate is going to the last thing that changes hands.  The margins aren’t there to capitalize it, there’s other demands on capital for growth to get enough scale to accommodate multiple family members, and to keep enough capital around to weather these downturns.”

He says when that exchange happens, more family members will be owning land in partnerships through inheritance.

Fassler believes the most successful farms will be those with a good governance process that are open and transparent with family about management decisions.

AUDIO: Brownfield interview with Mike Fassler during Michigan Agri-Business Association Winter Conference