ImpactAlpha, April 1 — Equilibrium Capital no sooner closed Controlled Environment Foods Fund I at $336 million than it announced the fund already is fully deployed in financing high-tech greenhouses for year-round food production.
“We’re fully committed to expanding in the sector,” Equilibrium’s Dave Chen told ImpactAlpha
The fund owns greenhouse assets of operators such as Houweling’s, Revol and Fresh Farms, enabling the producers to more rapidly expand operations to meet demand for tomatoes, peppers and cucumbers as well as lettuce and other greens.
“For the first time, agriculture is now seeing the impact of tech-based disruption and business-model innovation,” said Chen, who is speaking at this week’s Global AgInvesting conference in New York.
The expansive, $50 million to $100 million facilities are high-production food factories. Houweling’s Utah greenhouse, for example, uses waste heat and carbon dioxide from a nearby natural-gas power plant.
Australia’s LGIASuper pension fund committed $112 million to the fund; other investors included an unnamed Middle East sovereign-wealth fund and three family offices.
“Some of these pensions and sovereigns are looking at agriculture as a long-term hold, for capital preservation,” Chen said. “Others are looking at ag as one of the last remaining sectors that hasn’t been disrupted by technical advances.”
Disclosure: Equilibrium Capital has been a financial sponsor of ImpactAlpha. Dave Chen is co-host of the “Institutional Shift” series on ImpactAlpha’s Returns on Investment podcast.