Buyer of Pinal County farmland says exporting is key to economy

By Gary Nelson | The Republic | azcentral.com

(Disclosure: Rose Law Group represents Pinal Land Holdings)

The man who is putting $135 million in Mesa’s pocket over the next few years thinks he’ll come out on the long end of the deal over time.

Jackob Andersen is president of Pinal Land Holdings LLC, which was formed last year and is buying the more than 11,000 acres of Pinal County farmland that Mesa purchased in the 1980s for water rights.

The first phase, $20 million for 1,626 acres, closed in December.

Andersen also is president of Farm Sources International Holdings LLC, which offered to buy the land in 2012 and which through a subsidiary will manage farming operations on the parcels.

The companies are only part of An­dersen’s business interests, which in­clude the Central Arizona Commerce Park, a 580-acre industrial and shipping center in Casa Grande. He also has had projects in the United Kingdom, where he grew up, under different corporate banners.

It was that global perspective that fueled his interest in Mesa’s land, Ander­sen told The Republic during an inter­view at his Scottsdale headquarters — perhaps the only Class A office space in the region that, thanks to product dis­plays, actually smells like a hayfield.

Farm Sources International already had extensive farming operations in Ari­zona, including about 2,000 acres and a factory near Stanfield that turns hay and similar crops into cubed livestock feed for shipment around the world. Andersen said he got into that busi­ness several years ago because invest­ment experts had told him there was a solid future in export-based agriculture.

“What does America need to do?” he said. “America needs to cramp down our little deficit that we have hanging over our children’s heads. … So how are we go­ing to make that work? We start busi­nesses that export.”

The global future for American farm products looks rosy because of soaring populations and limited land resources in other parts of the world, Andersen said.

The farmers currently leasing from Mesa will stay there, free to sell their crops as they see fit. An FSI subsidiary will farm some of the land directly.

But income from those operations won’t cover the $135 million to be paid Mesa over the next 5 1 ⁄ for leases and purchases, Andersen said. Over time, he expects the land, between Coo­lidge and Eloy, to become ripe for development.

For one thing, two long-range trans­portation plans would fuel Pinal County growth. One calls for a freeway from Mesa’s Gateway area through central Pi­nal County; the other for a commuter rail line between Phoenix and Tucson.

For another, Andersen sees burgeon­ing job prospects in the region. In addi­tion to his own Casa Grande business park, Andersen mentioned Phoenix Mart, a 1.5 million-square-foot, under­construction facility that will serve as a wholesale-shopping center for business­es.

Phoenix Mart expects to create as many as 9,000 jobs, and Andersen said those people will need places to live and shop.

“I don’t think anybody has to think 11,000 acres is suddenly going to vanish and be houses over the next two years,” Andersen said.

But over time, he said, the ambitious communities in Pinal County will grow, and land values will do so as well.

Mesa paid nearly $30 million for the farms because the growing city figured it would need the water rights. But as other water sources emerged, the Pinal farms became superfluous.

Mesa hired land broker Nate Nathan — whose Scottsdale office is literally a stone’s throw from Andersen’s — to mar­ket the land in 2007, missing the high point of Arizona’s last real-estate bubble.

The land proved to be money in the bank nonetheless. A couple years ago, Mesa created an economic development fund into which it will funnel the Pinal proceeds.

Related: Agreement would cut ag subsidy program