McLEAN, VA—One doesn't normally associate such metrics as the Average Production per Acre of strawberries with an institutionalized asset play, but then a few years ago one didn't connect landholdings and the type of trees contained within -- southern pine versus Douglas fir -- with one either. But timber has become a valued commodity and timber REITs are a bona fide specialized niche per NAREIT.

Now it's farmland's turn.

With that context now established, we can better understand data that locally-based Gladstone Land Corp. released last week. The data was annual row crop statistics associated with growing fresh fruits and vegetables versus growing traditional commodity crops, such as corn, wheat and soybeans. It also included a table comparing the revenues, profits and rental cap rates across various row crops.

The reason for its release? Gladstone says that it says strongly supports its investment strategy of leasing a portfolio of farmland concentrated primarily in growing strawberries and other high-value fruits and vegetables, "as these types of farms are generally more profitable and less volatile than those growing commodity crops. The superior revenue and profit generated on these types of properties provides more net income to their operators and higher rental rates to the lessor."

Finally a familiar industry term – lessor. Yes, farmland REITs are probably the least recognized of all the asset classes that make up the REIT family but they are from the same provenance -- and increasingly, they are gaining market awareness. Earlier this month, for example, New York-based American Farmland Co. priced its initial public offering of 6-million shares at $8.00 per unit.

Farmland as a real estate asset class, though, is not a new concept -- it has been a quiet staple in the private investment market for years, delivering steady returns, according to the  the National Council of Real Estate Investment Fiduciaries Farmland Index.

Gladstone is among the tiny number of REITs in this space and like all REITs it has its approach to market, it's own secret sauce. For example, the REIT offers two kinds of leases to farmers. One is based on a cash basis with a modest increase every year. The other is a participating rent model in which the lessors are charged slightly less than the current basis.

But as CEO David Gladstone noted in a recent earnings announcement, the business thesis is rock-bottom simple. People have to eat and a farmers need farmland to grow food. "Yes, I know, I'm reminded from time to time about greenhouses but I'm telling you, we'd all starve to death if we had to live off the very tiny amounts of food that's grown in greenhouses."