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07/30/2021

AppHarvest Secures $91M for High-Tech Indoor Farms

Financing arrangement supports development plan for 12 facilities by end of 2025
Marian Zboraj
Digital Editor
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AppHarvest Secures $91M for High-Tech Indoor Farms
A $91 million construction loan will be used for AppHarvest’s 60-acre high-tech indoor farm in Richmond, Ky., which is designed to grow tomatoes.

Indoor farming continues in growth mode with ag tech company AppHarvest Inc. securing a financing arrangement with Equilibrium Capital for $91 million to support its Richmond, Ky., facility already under construction.

AppHarvest is a Certified B Corp company developing and operating some of the world’s largest high-tech indoor farms, designed to grow non-GMO, chemical pesticide-free produce, using up to 90% less water than open-field agriculture, and only recycled rainwater. The company claims that its process produces yields up to 30 times that of traditional agriculture on the same amount of land, without agricultural runoff.

The financial arrangement with Equilibrium provides 65.5% loan-to-value financing through a $91 million construction loan for the 60-acre high-tech indoor farm, which is designed to grow tomatoes.

“Equilibrium sets the bar for impactful investing in assets and companies centered on advanced sustainability principles. Their continued support of our mission shows confidence in our business model to build a climate-resilient food system based on great-tasting, nutritious fresh fruits and vegetables with more predictable yield and quality,” said Jonathan Webb, founder and CEO of Morehead, Ky.-based AppHarvest.

AppHarvest plans to operate 12 farms by the end of 2025. The company’s flagship 2.76 million-square-foot facility in Morehead is currently growing and shipping truckloads full of tomatoes to top U.S. grocers and restaurants. Four additional farms are under construction in Kentucky: the 60-acre facility in Richmond designed to grow tomatoes, a 15-acre facility in Berea designed to grow leafy greens, a 30-acre facility in Somerset designed to grow strawberries, and a 15-acre leafy green facility in Morehead.

“AppHarvest is laser-focused on scaling its mission. The financing we’re announcing today demonstrates the expected viability of high loan-to-value, non-dilutive capital financing as we remain on track to develop up to 12 high-tech farms by the end 2025,” said AppHarvest President David Lee, who joined the company at the beginning of the year after having been CFO at Redwood City, Calif.-based Impossible Foods since December 2015.

“Equilibrium is a sustainability-focused investment firm with institutional expertise in controlled environmental agriculture, which makes AppHarvest a natural partner as they work to drive positive change in agriculture to ensure food security sustainably,” added David Chen, CEO and chairman of Equilibrium, which has offices in San Francisco; Portland, Ore.; and London. “We’ve been supportive of AppHarvest since early in their history and look forward to more opportunities to partner as they build out their network of high-tech, climate-resilient farms.”

AppHarvest was added to the Russell 2000 index on June 28. Russell indexes are widely used by investment managers and institutional investors for index funds and as benchmarks for active investment strategies. The company will release its financial results for the second quarter of 2021 on Aug. 11.

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