Company: LANDO
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001495240-25-000005
Chunk: 150

Company: GLADSTONE LAND Corp
Filing Date: 2025-02-19
Form: 10-K
Item: Item 8
Chunk 150
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 a percentage of the gross crop revenues earned on the farm, which we refer to as participation rents.  Such contingent revenue is generally recognized when all contingencies have been resolved and when actual results become known or estimable, enabling us to estimate and/or measure our share of such gross revenues.  As a result, depending on the circumstances of each lease, certain participation rents may be recognized by us in the year the crop was harvested, while other participation rents may be recognized in the year following the harvest.Deferred rent receivable, included in Other assets on the accompanying Consolidated Balance Sheets, includes the cumulative difference between rental revenue as recorded on a straight-line basis and cash rents received from the tenants in accordance with the lease terms.  In addition, we determine, in our judgment, to what extent the deferred rent receivable applicable to each specific tenant is collectable.  We perform a quarterly review of the net deferred rent receivable balance as it relates to straight-line rents and take into consideration the tenant’s payment history, the financial condition of the tenant, business conditions of the industry in which the tenant operates, and economic and agricultural conditions in the geographic area in which the property is located.  In the event that the collectability of deferred rent with respect to any given tenant is in doubt, we record a direct write-off of the specific rent receivable, with a corresponding adjustment to lease revenue.Tenant recovery revenue includes payments received from tenants as reimbursements for certain operating expenses, such as property taxes, insurance premiums, and water delivery costs.  These expenses and their subsequent reimbursements are 

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recognized under property operating expenses as incurred and lease revenue as earned, respectively, and are recorded in the same periods.  We generally do not record any lease revenue or property operating expenses associated with costs paid directly by our tenants for net-leased properties.Other Operating RevenueOther operating revenue consists of non-lease revenue generated as a result of activities performed on certain of our properties.  During the years ended December 31, 2024 and 2023, we recognized approximately $453,000 and $79,000, respectively, of non-cash revenue, in the form of groundwater credits, associated with the transfer and storing of surplus water on behalf of a government municipality using a groundwater recharge facility constructed on one of our farms.  The timing of revenue recognition generally occurs once water credits are recognized by the respective water district at the estimated fair value of the resulting water credits.  See Note 3, “Real Estate and Intangible Assets—Invest