We are negotiating with several interested parties for the sale of the first 300 acres. We anticipate to see a healthy return of an estimated 50% for ProGreen on the approx. $300k of total investment, after first fully recuperating the initial investment. Though there is significantly more value and a greater return could be achieved, our priority for this first tract of land is to recover our investment and profit immediately upon execution of a quick sale.
With the second tract of land of approx. 1,900 acres as announced in May, we have started on this project and have so far completed the preparation of 11 miles of access road and surveying the land for water. As mentioned earlier we are not planning to sell this land but instead lease parcels under long-term agreements. We expect approx. 1/3 of the total land to be leasable as agriculture land, providing that we can obtain sufficient water, which we believe is likely from the initial survey. If so, we anticipate lease income of $800-$1,200/acre/year, or possibly as much as $1,500-$2,000 if considered as organic. As with the earlier JV, here, ProGreen will also recuperate all invested capital with priority, for this tract estimated to $600,000. The investment will be paid back to ProGreen in full from first lease payments, prior to any profits being distributed. This is a very favorable arrangement for ProGreen and allows us the ability to reinvest our principle into other projects while enjoying the benefits of a perpetual revenue stream and pure profit from the lease income.
Of the 12,000 acres under option, we estimate a maximum of 4-5,000 acres as leasable agriculture land, again depending on the access to water. If so, we estimate the total investment capital needed to be $2,500,000, if the option is exercised in full. Here as with the earlier JV’s, ProGreen will also recuperate its investment in full prior to any profits being shared.
As noted in prior communications, land that will not be leased for agricultural use is being considered for projects involving residential and commercial development as the business progresses.
We continue to make minor changes to the website to establish a clean and professional line of communication with our shareholders and the public at large. Updates have been made to reflect the company name and ticker symbol changes.