Strawberry land values hold steady in Southern California - The Packer

Strawberry land values hold steady in Southern California

02/10/2012 11:56:00 AM
Tom Burfield

Tom BurfieldWorkers pick strawberries at an Oxnard field of Watsonville, Calif.-based Well-Pict Inc. in early February. As land values have plummeted in much of the U.S., farmland in Southern California has held its value. The real estate woes that have swept across the U.S. during the past few years haven’t affected the value of land used to grow strawberries in Southern California.

“Land values here are pretty stable,” said Tom Deardorff, president of Deardorff Family Farms in Oxnard, Calif. “They haven’t gone down at all.”

The value of strawberry land doesn’t trend with the typical industrial/commercial real estate market, he said.

“It’s more driven by ag purposes and speculation on future development 10 or 15 years down the road,” Deardorff said.

The law of supply and demand plays a big role in maintaining real estate values in strawberry country, said Terry Mason, rural section supervisor for the Ventura County assessor’s office.

Strawberry processors and fresh market growers need strawberries that come into season at different times so they can supply the market year-round, he said.

“The Oxnard plain is an area that can grow pretty much year-round, so the land is really valuable,” Mason said. “A lot of growers have been buying up large parcels of land.”

Landowners who commit their land to agriculture for 10 years get a tax break under the Williamson Land Conservation Act, he added.

So far, not a lot of land has been gobbled up by residential and commercial development in Ventura County compared with some other parts of the state, such as Orange County, about 100 miles southeast of Oxnard.

An exception is along the 101 Freeway corridor, especially in Camarillo, Oxnard’s neighbor to the southeast.

Those developments could be a precursor of things to come, Mason said.

“There seem to be people who are willing to stay (in agriculture) for the long run,” he said. “Hopefully, we will be able to draw a line in the sand and protect the land.”

In Orange County, the recession has put the brakes on the housing market, but apartment development is proceeding briskly, which means Orange County Produce in Irvine has lost some acreage, said Matt Kawamura, partner in the company with his brother, A.G. Kawamura.

To make up for lost land, the company has expanded by adding 100 acres in Oxnard.

Orange County Produce also will grow strawberries in Santa Maria, about 100 miles northeast of Oxnard, and in Watsonville to create a year-round deal, Kawamura said.

Orange County growers will have more time to farm land that’s been designated for housing developments because of the housing slowdown, he said.

“Right now, there isn’t any new ground to be had,” he said. “We have nowhere left to go in Orange County.”

In Santa Maria, land values also are holding steady, said Jose Corona, president of Corona Marketing Co.

“Once ground becomes available, there are so many people bidding on it that they push the price back up,” he said.

Back in Oxnard, Deardorff Family Farms has experienced “slight upward pressure on rents,” Deardorff said.

“There’s still increasing demand for strawberry acres,” he said, so farmers are willing to pay higher rent to get that kind of ground.

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