Approximately 1,600 acres of Illinois farmland sold for a total of $10.5 million last week. The auction was closely watched by area farmers and investors as a barometer of the strength of prices for tillable land, according to Rex Schrader, president of Schrader Auction.
"There was a lot of interest in this sale, not only among those seeking to buy the land, but among those who saw it as a test of the strength we've continued to see in the market for tillable farmland. Even with approximately 1,600 acres selling in one day, the market absorbed it nicely," Schrader says.
The sale included three farms that were being sold as part of the Chapter 11 reorganization of VeraSun Energy to maximize the return for creditors.
The sale included:
* Approximately 487 acres in Litchfield, Ill., in Montgomery County, which sold for $3.3 million, or an average of $6,740 per acre. The land, primarily tillable farmland, sold to five different buyers, with the two largest buyers including a local buyer and an out-of-state investor seeking land for a possible future grain terminal. "There was a great deal of interest in specific tracts as well as various combinations. The rail access made it attractive as a grain terminal site, and that added to the demand," Schrader says.
* Approximately 380 acres in Madison County, Ill. After active bidding in various combinations, the property sold to a local farm family as an entirety for $2.9 million, an average of $7,591 per acre.
* Approximately 733 acres in Vermilion County, in eastern Illinois. After bidding in various combinations, the property sold as entirety for $4,3 million, or $5,903 per acre. "This was a buyer who was adding to his family's existing holdings. While there was a great deal of participation among both farmers and investors, institutional interest was diminished a bit because some of the land excluded mineral rights and was adjacent to a nearby Superfund site. There was also a portion of the land where underground mining had been conducted some years back," Schrader says.
The land in Montgomery and Madison counties sold in a morning session in Staunton, Ill. The Vermilion land sold in an evening session near Covington, Ind.