Mastronardi Acquires Indoor Leafy Greens Farm For $127 Million

AppHarvest announced an agreement with Mastronardi Berea LLC, a joint venture of Mastronardi Produce and COFRA Holding, for the sale-leaseback of its high-tech indoor farm for leafy greens in Berea for approximately $127 million.

Mastronardi Produce is AppHarvest’s exclusive marketing and distribution partner, which has sold AppHarvest’s produce, including tomatoes, leafy greens, and strawberries, into some of the top national grocery store chains, restaurants, and food service outlets.

In 2022, Mastronardi has grown its local network by more than 350 acres — nearly half of which is lit growing capacity — in the company’s ongoing commitment to increasing access to high-flavor, locally grown fruits, and vegetables year-round.

According to AppHarvest, some of the sale-leaseback proceeds will be used to repay the previously announced $30 million bridge loan from Mastronardi Produce to AppHarvest and the first two years of prepaid rent at the Berea facility.

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Mastronardi Produce grows and markets nationally recognized products, and it’s a pioneer and industry leader in the gourmet greenhouse industry. The company has been family-owned for over 70 years and prides itself on producing consistently flavorful gourmet tomatoes, peppers, cucumbers, and berries.

In addition to the acquisition of AppHarvest’s indoor leafy greens farm in Berea, Ky., to its Control Environment Agriculture portfolio, Mastronardi Produce is now in eight states. The company grew exponentially during 2022:

  • Earlier this year, the largest-ever greenhouse lettuce build was completed in Berea, Kentucky, spearheading cultivation for Queen of Greens™, the industry’s first scaled, washed, and ready-to-eat greenhouse lettuce.
  • In nearby Richmond, an immense 60-acre lit greenhouse has been built, catapulting production of beloved SUNSET® tomato varieties like the brand’s flagship Campari® tomato.
  • In June, The Utah Greenhouse Company joined the Mastronardi network and began growing SUNSET’s coveted Bombs® tomatoes in a high-tech 28-acre greenhouse set to double capacity.
  • In response to the vast demand for CEA strawberries, Mastronardi recently added two new strawberry greenhouses to grow SUNSET’s award-winning WOW® Berries. Over 100 acres of lit strawberry farms are now in operation, solidifying WOW Berries’ industry leadership in a category it pioneered over a decade ago.

According to USDA reports, the value of U.S. fruit and vegetable imports rose to a record level in 2021 and has been projected to keep increasing in 2022. Changing weather patterns—ranging from mega-drought in the Southwest of the U.S. to more frequent flooding to catastrophic wind events—are making it harder than ever for open-field farmers to predict the duration of their growing seasons and to have conditions that result in a quality harvest.

Major food retailers have demonstrated increasing interest in high-tech indoor farms for their ability to de-risk fruit and vegetable production with a more climate-resilient, sustainable year-round growing solution that uses far fewer resources.

Europe, a pioneer in the industry, is estimated to have nearly 520,000 acres of Control Environment Agriculture production compared to an estimated 6,000 acres in the United States.