In Spain, a notable portion of rural landowners and livestock farmers are approaching retirement. This reality means that thousands of hectares of crops could be inherited or left uneconomical if relatives do not assume responsibility for the land. Investment funds have taken notice. Corporate investments in the agricultural sector rose by 20 percent in 2022 versus the prior year, reaching 1,000 million euros, and were up 150 percent from 2021. Projections suggest this figure could double in 2023. They acquire companies and land based on profitability targets, aiming for returns between 8% and 15%. Even drought warnings do not deter their plans. “This is a lasting trend,” remarks Gabriel Trenzado, general manager of Agri-Food Cooperatives.
Private equity funds are capitalizing on market conditions and the ongoing generational transition gap. Government statistics from the Ministry of Agriculture, Fisheries and Food show that 93% of landowners are individuals and the number of formal farming companies is under five percent. The path forward, as industry voices suggest, is for institutional investors and smaller farmers to buy available lands to consolidate larger operational zones and unlock profitability mainly through economies of scale. Mechanization of tasks, according to Cocampo’s founder, is a central theme. The Rural platform, which lists agricultural properties for sale and lease, has observed a surge in demand from institutional buyers, with its advertisements more than tripling over the last two years. In total, listings represent roughly 2 billion euros in value.
Significant acquisitions in farming and agro-industrial groups have occurred over the past two years. ProA Capital acquired Patatas Hijolusa in 2022 and expanded its portfolio with Moyca, a seedless table grape producer, and more than 2,200 hectares of land. Edit Frutas bought Agromillora, the nursery company formerly associated with Bollo, while Fremman Capital joined Corral Group in ownership. Miura Partners stands out with Citri&Co, a fruit group generating annual turnover above 700 million euros across more than 300 hectares. In 2023, Portobello Capital bought 45% of the Valencian company Eurocebollas, and Fair Capital entered the agriculture-food arena by acquiring Innoliva. Deoleo has engaged with CVC through olive oil ventures as well.
Assets to diversify
Spain ranks as the EU country with substantial agricultural expansion. It features 23 million useful agricultural hectares, of which 17 million are cultivated; 76% of these are dry land and 24% are irrigated. Interest from investment funds in Spanish rural properties dates back to 2017. Since then, about 400,000 units have traded on average, with around 234,000 transactions occurring in the first half of 2023 alone. A large share of activity, 43%, has centered in Castilla y León, Andalusia, and Castilla La Mancha.
Strategies vary with the profitability goals that investors pursue. Recent activity shows greater acquisitions in citrus and vegetables, while the woody sector olives, almonds, and pistachios has seen more leases or purchases. Almond, pistachio, avocado, kiwi, and red fruit farms have expanded and are being developed by a smaller number of companies, with investment flowing directly to the farm level. The INE notes a historical peak in rural property transactions in 2021, with subsequent years maintaining a higher level than pre-pandemic figures. A total of 371,144 transactions were recorded, nearly half of them inheritable transfers. For lease structures, funds typically offer thirty-year land leases with premiums ranging from 1,000 to 1,500 euros per hectare. This dynamic has sparked concerns among farmers about the geographic concentration of farmland.
Some observers highlight that pension funds and large insurers prefer lower-risk models such as purchase and leaseback, yielding 5–8% depending on product and land. In mid-risk scenarios, agricultural equities allow land to be managed by operators with returns of 8–12%. Private equity, however, tends toward higher risk by purchasing equity in farming companies, with expected returns often surpassing 15% (source attribution: CBRE and industry analysts).
Today, more than 900 investment funds worldwide specialize in agri-food ventures. About half of these operations remain centered in North America, yet European managers are increasingly attracted by Spain’s geography and rising land values. Experts anticipate continued profitability, driven partly by the rise in irrigated fertile land prices. Climate changes and drought are not currently reducing investment volumes but are altering ownership and exploitation patterns, fueling competition for production and contributing to higher land prices. The trend also interacts with Spain’s demographic challenge, including the generational shift that places land at a crossroads between legacy and modern farming demands.