[REN #594] Vertical Farming Gaining Ground

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picture of plant for Real Estate News for Investors Podcast Episode #594

You might not think of Las Vegas as a farming community, but it’s now home to one of the largest modern farming operations in the United States. A startup called Oasis Biotech turned a vacant industrial property into a $30 million vertical-farming facility as a way to provide fresh locally-grown produce to the city’s many upscale restaurants.

Vertical farming is a method of farming that turns an indoor space into a highly productive plant factory. Plants are typically grown hydroponically on shelves, inside buildings that can be more than one story tall. Vertical farming can produce many more plants than an outdoor farm with the same footprint. Vertical farms also produce food year-round, and can be located within miles of their destination, like the one in Las Vegas.
 

Year-Round Harvest with Vertical Farming

Oasis held its grand opening just a few months ago. According to Business Insider, local chefs and mixologists helped host the event by providing salads and cocktails made with produce grown in the new facility. It’s 215,000 square feet with plants growing in stacked trays. Oasis is now delivering its produce under the name Evercress to restaurants and casinos along the Las Vegas strip. [1]

This could help revolutionize the way that Las Vegas gets its food. A report in 2014, by the Las Vegas Sustainability Atlas, found that only 8% of the food in Las Vegas was locally grown. The other 92% was shipped in by truck.

General Manager, Brock Leach, said in a statement, “We want to redefine the meaning of fresh produce in Las Vegas. We are now living in a world where the produce your family consumes will be grown in the same city in which they live.”

Oasis says, the cost is about the same as it would be for organic products. It’s also super fresh because it can be delivered within hours of picking it. Oasis is currently selling only to restaurants but may expand that to grocery stores as its business grows.
 

Nevada Enthused about Vertical Farming

Nevada state officials are very enthused about the enormous size of this new farm. Jennifer Ott, of the Nevada Department of Agriculture, said of Oasis, “When one company is successful, it lifts everyone up.” She says the market for this kind of farming in Nevada is “definitely growing.”

According to the Las Vegas Review-Journal, the number of indoor farms has grown from just 3, in 2014, to at least 42 last year. Leach said, the operation feels there’s big demand for high quality produce in Las Vegas. He said, “The density of high-end restaurants is one of a kind in this market.” He expects to produce tens of millions of dollars of produce to meet the demand. [2]

The U.S. Department of Agriculture believes vertical farming is the way of the future. The USDA said in a blog post:

“Beyond providing fresh local product, vertical agriculture could help increase food production and expand agricultural operations as the world’s population is projected to exceed 9 billion by 2050. And by that same year, two out of every three people are expected to live in urban areas. Producing fresh greens and vegetables close to these growing urban populations could help meet growing global food demands in an environmentally responsible and sustainable way by reducing distribution chains to offer lower emissions, providing higher-nutrient produce, and drastically reducing water usage and runoff.” [3]

Food grown in vertical farms is also protected from bad weather so there’s no storm-related crop losses. That could help address concerns about food production and climate change.
 

Real Food Revolution

The use of vertical farming has been getting more attention in recent years. The brother of Tesla founder Elon Musk is hoping to create, what he calls, a “real food revolution” with his own brand of vertical farming. Kimbal Musk co-founded an urban farming incubator called Square Roots, with partner Tobias Peggs.

The year-long program teaches young people how to be agricultural entrepreneurs. They don’t just learn the basics of farming but also farm management, marketing, community outreach, and business leadership skills. Peggs says of the program, “What we’ve proven in the first phase is we can take young people with no experience in farming and get them very, very quickly to grow really high-quality food that people want to buy.”

Musk and Peggs began the program in Brooklyn with 10 shipping containers. They are now ready to expand. USA Today reported recently, Musk is ready to set up year-round shipping container farms for young entrepreneurs in 10 cities later this year.

It’s a full-time job with 15 to 20 hours of farming per week, another 10 hours of handling the business side of things, and 10 hours of coaching by company mentors. Most of the participants are millennials. Many are drawn to the program because of the high-profile “Musk” name.
 

Path of Progress

As his brother, Elon, is doing with the development of electric vehicles and space travel, Kimball Musk is doing with agriculture. He told USA Today, “I don’t enjoy the industrial food system. It’s definitely not good for America or the world.” He said, “We’re very excited to teach Americans about real food.”

The use of vertical farming is gaining ground, no pun intended. When you hear talk about the “path of progress,” this is one of the disruptive forces that will take us along that path. It’s very connected to the use of available land and how we will put food on the table for a growing number of people on the planet.

Links:

[1] Oasis Grand Opening: Business Insider

[2] Las Vegas Review-Journal Article

[3] Vertical Farming is the Future: USDA Blog

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