BLOOMINGTON, Ill. — It’s been said that you can take the boy off the farm, but you can’t take the farm out of the boy.
As a youngster, David Klein had dreams of being a farmer on his family’s farm between Gridley and Lexington. All that changed with a visit to the doctor and an allergy diagnosis, but he still was able to find a way to stay close to his love of agriculture.
Klein now wears several hats at Soy Capital Ag Services, where he is vice president, principal managing broker and manages about 7,000 acres of farmland.
He began his career at what now is Soy Capital in 1997. He also is a farmland auctioneer, a title he added to his duties in 2012.
The 1993 University of Illinois graduate met with this reporter Nov. 10 after auctioning two parcels of land in McLean County that went for $8,850 and $8,000 per acre, respectively, for sales of 67.65 and 79.67 acres.
How did you decide to go into a career in farmland management and eventually adding farmland auctioneer to your duties?
Ironically, I’m allergic to corn and soybean dust. Yes, I grew up on a farm, and I had an allergy doctor say that I needed to find something else to do because “you’re not going to farm.” That was kind of a rude wakeup for a kid that just assumed he was going to be a farmer someday.
So I found the next closest thing I could do to farming, which was managing farms, and then the buying and selling of farms becomes a natural thing in our business because, as we manage farms, people pass away, trusts mature, estates need to be handled and someone needs to sell the farm, so we might as well be doing it.
Soy Capital manages over 240,000 acres of farm ground. So we have a pretty constant inventory of people passing away and trusts maturing, so the farm has to be sold.
The family farms about 3,000 acres, and I still enjoy going back to the farm and help for maybe a day or two, but that’s about it and then I’m all stuffed up and wheezing and I have to get back to the office.
You attended Illinois State University and then graduated from the University of Illinois. What was your major and are there any additional continuing education requirements?
I majored in ag economics with a concentration in farm management and ag finance. There are state continuing education requirements for auctioneering.
I’m also an accredited land consultant with the Realtors Land Institute and accredited farm manager with the American Society of Farm Managers and Rural Appraisers.
What recommendations do you have for someone who wants to become a farmland auctioneer?
Learning the trade is important. There’s a lot more that goes into it than just calling the auction. There is the background work, the detail work ahead of time.
The auction is just the final culmination of getting to that point. All of the layout work ahead of time of getting buyers lined up and getting people excited and ready for a farm and getting them the information so they can make an informed decision.
For people who want to go into it, they need to have a really good understanding of soils and productivity and detailed knowledge of what goes into valuing a farm, drainage, soil fertility, understanding how those types of things matter. Also have a lot of patience because you’re dealing with people that are making difficult decisions with millions of dollars’ worth of assets.
We’re not buying or selling toys and trinkets. We’re selling something that is funding someone’s retirement usually or someone’s college fund for their kids … It’s an important part of most people’s livelihoods.
It’s a big decision for people to make when they decide to sell a farm, and it’s also one that we don’t take lightly. Every project we take on, we try to do as good of a job as we can in generating interest in it.
What kind of trends have you seen in terms farmland prices?
We’re still in a somewhat lower trending environment. There is no doubt that the higher percentage tillable, the squarer tract and the higher the soil fertility index on the farm the higher the price is going to be.
Farmers just don’t want to deal with waterways. They don’t want to deal with odd-shaped fields.
They don’t want to deal with a lot of neighbors. Because about every farmer, if he farms any number of acres at all, has a horror story of dealing with a neighbor that’s unhappy with him because take your pick. Maybe you tilled over too far or they claim the herbicide drifted, whether it did or not doesn’t matter.
What are the primary reasons for selling farmland?
The majority of it is still estate settlement or people who have inherited ground and maybe they’ve held it for a couple years and decided now that they want to sell it.
We run into several folks that for one reason or another may hold onto a farm for a couple of years and sometimes it’s a relationship with the tenant where maybe the tenant is nearing retirement and they have enough sentimental attachment to the tenant that they want to see them to that end.
There is some movement of people that have invested in farmland and are now looking to maybe capture some of that gain that they were able to benefit from. What we still don’t have is very many so-called forced sales where people weren’t forced to make that decision, they chose to and were at peace with the decision that they made.
A good portion of the buyers are farmers, but I would have said 60 percent of the farmland is being purchased by farmers in the past, and we may be going back to that 40 to 50 percent range.
What is a typical day or week with the job?
Yesterday I was in boots by a tiling machine, and today I’m in a suit and tie calling an auction. The one thing about this job is you can be in the field one moment with multimillionaires, sometimes even billionaires, in your presence that have farmland investments.
There are long days, long nights, lots of hours, so you need to love the work if you want to do this job. There is a lot of variety in those long hours.
Last week, I was in Iowa looking at a farm to purchase for a client, and we’re going to get that done. Today, I’m in Illinois auctioning off a farm for other clients.
So you get to use your brain to figure out the financing and budgeting side, and some other days you’re looking at fields and determining whether or not you’re going to spray Banvel, Roundup or whatever.
What are your favorite parts of the job?
There’s no doubt the favorite part of it is having satisfied and happy clients and helping somebody achieve their goals of what they want to see happen so they can then make that next plan in their life.
That’s the most rewarding part, when you can help somebody get to the end of a goal and be happy with the results. That’s the No. 1 thing.
What are some of the most frustrating parts of the job?
Sometimes people’s expectations in a down-trending market are still not realistic with where we’re at, and sometimes we have to walk away from projects because their expectations are two or three years ago and unfortunately that’s not where we’re at today.
There are frustrating moments just like any other job, but overall the majority of people that own farmland are good people to work with. We get to have that one-on-one relationship and that direct communication with the person making the decisions, and because of that, you can do a better job than when there’s somebody in between or whatever else.