While big real estate sales on the island recently have been in  the limelight, the party has been going on out west of Vero as well where agricultural land prices have soared.

More than 18,000 acres of field, forest and grove land changed hands in the past two years – an aggregate area more than twice the size of the City of Vero Beach.

Prices rose 100 percent or more in some sections, according to county property records, and there have been blockbuster deals for as much as $76 million.

“Land prices are good,” said Jeff Cusson, a senior advisor with SVN Saunders Ralston Dantzler Real Estate, who has among his current listings the 5,849-acre Corrigan Ranch.

“A lot of ag land east of I-95 has doubled in value and is now $40,000 to $50,000 an acre. It is surprising how much that area has gone up.”

“I think ag land prices have all gone up as part of the general rise in the real estate market, and because people are still wanting more space and acreage after covid and commodity prices are strong,” said county Property Appraiser Wesley Davis, a fourth-generation Indian River County farmer. “It is economics 101.”

Generally speaking, land east of I-95 and west of the interstate but close to it along Route 60 is most valuable, while values trail off the farther west you go.

Buyers include not only farmers and ranchers, but homebuilders, investment, groups, people from a range of foreign countries, and hedge funds.

And looming above all other buyers is Florida Power & Light.

FPL – which has been building sprawling solar energy farms along the Treasure Coast, including six in Indian River County – has been on a massive land buying spree.

The biggest ag land deal of the past two years took place in April 2022 when SVN Saunders, where Cusson works, brokered the sale of 10,144 acres that straddle the Indian River and St. Lucie county border to FPL for $76.7 million.

“They’ve purchased 28,000 acres in the three-county area in the past five years. That is 43 square miles,” said Cusson.  “FPL has been a significant factor in supporting and even driving land prices.”

Rancher and Alex MacWilliam realtor Michael Sexton said he believes FPL is now the largest landowner on the Treasure Coast.

Cusson said the area is also “seeing more investors with a global perspective, with a lot of hedge funds buying land.”

What is happening here is part of a nationwide post-pandemic phenomenon that is generating headlines throughout business and agriculture media.

“U.S. farmland escapes real estate slump as prices soar to record,” was a Bloomberg headline in December, while Farmprogress.com reported that, “Hot farmland prices resist interest rate hikes.”

“Rising commodity prices mean farmers made record amounts of money this year, spurring a rush for space to plant in 2023,” according to Bloomberg. “More demand comes just as people fled to the countryside during the pandemic – with non-metropolitan areas growing faster than urban ones – and investors turned to fields as a hedge against inflation.”

The farmland boom is centered in the Midwest corn and soybean belt, where productive acres come with strong cash flow as well as price appreciation, making land an attractive way to diversify a portfolio.

As always, though, real estate is local and the situation in Indian River County is different from in Iowa or Ohio.

Here, the demise of citrus, the area’s once great and glorious cash crop, has put the biggest downward pressure on prices, followed by restrictions that come with conservation easements.

“Prices are moderated somewhat in our area by the decline of citrus,” said Cusson, who was president of Becker Groves before going into real estate.

“At one time, there was 200,000 acres in groves on the Treasure Coast – in Indian River, St. Lucie and Martin counties – and we are now down to about 25,000 acres.”

The decline of citrus, caused mainly by greening, a disease that ruins trees for fruit production, has actually been a double whammy to agricultural land values here, leaving  tens of thousands of acres in Indian River County unproductive.

“No clear agricultural land use has emerged to replace citrus,” Cusson said.

Davis said conservation easements also put a brake on land values in the extensive parts of the county where they exist.

“When you sell a conservation easement, you still own the land, but you are very restricted in how you can manage it and what you can use it for,” he said. “You can grow hay or run cattle, but you can’t fertilize or grow other crops.”

That is a problem because the land typically comes with improvement district taxes, levied to maintain roads and canals and pump water off of or onto fields, depending on conditions.

Davis gave an example of a parcel in the St. Johns Improvement District, west of I-95 where the district tax is $150 an acre per year, which makes it hard to raise cattle profitably.

“It is like you are paying that amount as pasture lease and you can’t pay that much and make a profit,” said Davis, whose family once had 600 acres of dairy and citrus land up around the area where the Publix plaza is now at the intersection of route 510 and 512, and who still has a herd of 50 cattle on a 40-acre remnant of the old spread.

“When the land was in citrus, the growers needed the roads and canals and big pumps the districts were created to provide and they were making good money so nobody blinked an eye at $150 an acre, but it is a lot different now,” Davis added.

Although they serve a good purpose in the larger scheme, the sale of a conservation easement essentially sucks much of the value out of agricultural land.

Case in point: A 781-acre tract of ag land on Route 60 a couple of miles west of I-95 that is “encumbered by a Wetland Reserve Program Conservation Easement [that] ... permanently limits drainage and prohibits the construction of any permanent structures on the property” is on the market for $1,350,000, according to Land.com.

That amounts to $1,700 an acre.

By contrast, a 76-acre piece of pastureland just down the road at 1890 98th Ave. that has development potential is listed for $10,800,000, which translates to $141,000 per acre.