Limoneira announces partnership with real estate arm
Limoneira received $18 million ($16.8 million net of transaction expenses) upon the establishment of the partnership in addition to $2 million the Company received from The Lewis Group in September 2015, in anticipation of the formation of the partnership. Limoneira Lewis Community Builders, LLC is a 50%/50% partnership between Limoneira and The Lewis Group that will engage in the residential development of the Harvest at Limoneira (formerly Santa Paula Gateway Project and East Area 1).
The formation of the partnership culminated with Limoneira’s contribution of its East Area 1 property and The Lewis Group’s contribution of $20 million. The funds were distributed to Limoneira upon closing the transaction, which it expects to record as a reduction in the basis of its investment. Limoneira expects to receive 25% to 80% of the net cash flow of the project, based on cash flow milestones provided in the partnership agreement, which is estimated to aggregate approximately 70% of total net cash flows to Limoneira, including the initial $20 million distribution, and the balance of net cash flows to the Lewis Group over the estimated seven to ten year life of the project.
For more about Limoneira Company, visit www.limoneira.com.