By SHELLY STRAUTZ-SPRINGBORN
DECATUR, Mich. — An Indiana-based investment firm was the top bidder in a recent land auction ordered as part of a farm bankruptcy settlement in Michigan.
Ceres Partners in South Bend, Ind., bought 2,200 acres of farmland in Cass, Van Buren and Allegan counties for $16,969,250, including buyer’s premium, during a standing-room-only auction on March 28 at the Lawton Heritage Community Center in Decatur.
The sale was a court-ordered action in the bankruptcy of Stamp Farms LLC. According to Byron Center-based Auctioneer Sid Miedema, 26 parcels were offered individually, in combinations and as one unit.
“There were a lot of bids, where guys wanted to buy, say, a couple of farms,” Miedema said. “There was one person bidding on the entirety and several other farmers bidding on different various parcels of it that kept pushing the bid higher and higher, and finally the gentleman who wanted the whole thing ended up with it.”
Perry Vieth, president and founder of Ceres Partners LLC, did not return calls by press time seeking comments about the land purchase.
According to the company’s website, the goal of Ceres Partners is “to identify, acquire and manage the best farmland the Midwest has to offer … Ceres Partners serves as the general manager and uses its extensive network of proven agricultural producers to obtain attractive cash rent or crop share leases.”
The company owns more than 29,000 acres of farmland in Indiana, Michigan, Illinois, Kentucky and Ohio.
Stamp Farms, in the rural community of Decatur, Mich., filed for Chapter 11 bankruptcy relief Nov. 30, 2012. Its entities include Stamp Farms, LLC; Stamp Farms Trucking, LLC; Stamp Farms Custom AG, LLC; and Royal Star Farms, LLC.
According to the business website, Stamp Farms began in 1968 with 168 acres of farmland. Since 1997, it grew to more than 20,000 acres and spanned six southwestern Michigan counties.
Court records from U.S. Bankruptcy Court Western District of Michigan listed the farm’s assets at $10 million-$50 million and its liabilities at $50 million-$100 million. The estimated number of creditors was between 200-999. According to bankruptcy documents, the top 20 creditors are owed a combined $5.7 million.
At the close of the land auction, a 143-acre parcel of ground in Cass County brought more than $9,400 per acre and a 77-acre parcel in Van Buren County sold for more than $9,000 per acre, according to Miedema. The total auction proceeds generated 35 percent more than the minimums that had been established by the U.S. Bankruptcy Court.
“What we’ve seen is land prices have been going up in value because both farmers and investors have seen farmland as being a very good investment,” he said. “It has pushed the price significantly higher than what it was three or four years ago.
“We have seen aggressive bidding, and there’s always a lot of interest in farmland.”
Miedema wasn’t surprised by the large crowd and extensive interest in the land.
“If land comes up for sale close to your farm, sometimes you don’t get an opportunity to buy it again, so you have to be pretty aggressive,” he said. “That’s what makes an auction a good way to sell. You never know if somebody else might have been willing to pay more.
“What I was surprised by is that it all went to one person. I thought maybe two or three or four farmers would end up buying it as separate parcels, but it all went to one investment firm.”
“Our projections for the auction were quite close to what it ended up bringing,” he added. “We assumed there was going to be a lot of interest. Prior to the auction, we had calls from all over.”