TIAA-CREF Asset Management manages a wide range of assets spanning a variety of portfolios. Learn more about how we implement our innovative investment strategies through these short case studies from around the globe.
WITH HEATHER DAVIS, SENIOR MANAGING DIRECTOR, HEAD OF GLOBAL PRIVATE MARKETS
Anticipating the growing economic momentum of sustainable food production, TIAA-CREF has established a unique portfolio of valuable, strategic agricultural assets in some of the world’s most productive areas. The organization has acquired more than 400 farms located across the U.S., Australia, Brazil, and Eastern Europe.
TIAA-CREF’s agricultural portfolio is not only comprehensive, but also market-targeted — with growth crops that range from corn to soybeans, sugar to apples, cranberries to wine grapes, and pistachios to almonds. In fact, the organization is now one of the largest growers of almonds in the world.
With the help of tenant farmers, TIAA employees manage all the domestic and international farms in the permanent crop portfolio. Experienced commercial farmers work side-by-side with portfolio and investment professionals from the organization, on the ground at the farm sites. TIAA-CREF’s acquisition of a controlling interest in Westchester Group, Inc., one of the nation’s premier agricultural asset managers, has brought a further dimension to the organization’s in-house expertise. Given TIAA-CREF’s significant capabilities in commercial real estate, this insight has been leveraged across the agricultural portfolio, enabling the implementation of best-practice real estate strategies and the deployment of the organization’s real estate appraisers, engineers, and attorneys into the agriculture sector.
TIAA-CREF established a footprint in agricultural investing by purchasing a $300 million portfolio of properties from the State Teachers of Illinois. That selection of properties included farms of grain, soybeans, and other permanent crops.
“Our first agriculture purchase was a $300 million portfolio of grain and soybean farms,” explained Heather Davis, Senior Managing Director, Head of Global Private Markets.
After acquiring domestically, TIAA-CREF expanded internationally to Brazil, Australia, and Eastern Europe. The firm invested in properties in Brazil, purchased multiple large tracts of farmland in Australia, and acquired some smaller farms in Eastern Europe.
In the state of Washington, TIAA-CREF owns apple orchards and vineyards on a property called Badger Mountain. A critical element of apple production is the availability of a reliable workforce.
Senior Managing Director, Head of Global Private Markets, Heather Davis, suggested an approach that has proven both socially beneficial and notably efficient. Being the mother of an autistic child and knowing the vast, often untapped abilities of a uniquely capable group of people, Heather suggested TIAA employ autistic and disabled individuals to support the apple harvest during picking season at the orchards. TIAA-CREF engaged with the local community as an organization and worked to identify just such a team willing to work on the farm. This program, now called Fruits of Employment, provided significant benefit to the community and created an opportunity for some very special people to work outdoors with a regular schedule — people who might have not been given the chance otherwise. For TIAA-CREF, this strategy delivered cost efficiencies because of the dependability and low attrition rate of this unique workforce.
“We reached out to the local community and identified a group of people—not just autistic—that could help us on our farms” added Davis.
In fact, because this approach has been so successful, a similar Fruits of Employment program is being established in Santa Barbara County, California, at White Hills Vineyard, a property being renovated to produce other permanent crops. Like the farm in Washington, the vineyard will have an alternate workforce dedicated to raising and harvesting the crops.
TIAA’s Agriculture investments are just one of many investments of TIAA’s General Account, an account solely owned by TIAA that is not available to individual investors and whose performance is not directly allocated to any specific contract or obligation. TIAA’s General Account invests in a broad range of diversified investments to support TIAA’s contractual guarantees and business operations.
Past performance is not indicative of future results. The material is for informational purposes only and should not be regarded as a recommendation or an offer to buy or sell any product or service to which this information may relate. Certain products and services may not be available to all entities or persons.
Daily oil usage is expected to rise to over 100 million barrels of oil equivalent (BOE) by 2030 1; so, the market for oil, coal, natural gas, and alternative energy sources is steadily increasing.
While world food, stock feed and bio-fuel demand is increasing, the global supply of arable land is shrinking.* This imbalance underscores the investment logic of TIAA-CREF’s strategic acquisition and responsible management of prime agricultural land around the globe.
In the TIAA-CREF agriculture portfolio, social responsibility goes hand-in-hand with global investing. The organization’s analysts recognize the value of international investing in socially-responsible and environmentally-friendly ways. This idea pervades many of the organization’s investment decisions.
© 2012 and prior years, Teachers Insurance and Annuity Association - College Retirement Equities Fund, New York, NY 10017
Past performance is not indicative of future results. The information on this website should not be regarded as a recommendation or an offer to buy or sell any product or service to which this information may relate. Certain products and services may not be available to all entities or persons.
TIAA-CREF Asset Management provides investment advice and portfolio management services for the TIAA-CREF group of companies through our investment advisers including Teachers Advisors, Inc., a registered investment adviser and wholly-owned indirect subsidiary of Teachers Insurance and Annuity Association (TIAA). TIAA® personnel in its investment management area provide investment advice and portfolio management services through the following entities: Teachers Advisors, Inc., TIAA-CREF Investment Management, LLC, and Teachers Insurance and Annuity Association® (TIAA®). TIAA, TIAA-CREF, Teachers Insurance and Annuity Association, and TIAA-CREF Asset Management are registered trademarks of Teachers Insurance and Annuity Association.