ANDERSON — A local businessman purchased more than 800 acres of prime farmland in Delaware and Madison County for almost $8 million during an open bid process.
John Paugh, CEO and president of Carter Express, bought the farmland and plans to keep it for agricultural use, he said Wednesday.
”I am very grateful for the opportunity to purchase the land,” Paugh said. “I believe land, and farmland in particular, is one of the best investments you can make.”
Paugh, whose companies employ more than 750 people locally, was recognized in December as “Entrepreneur of the Year” by the Madison County Chamber of Commerce and Anderson University for his commitment to the area both professionally and personally.
”My current plan is for the land to remain as crop producing farmland for the foreseeable future,” he said.
Approximately 150 people attended the auction at the Horizon Convention Center in Muncie on Tuesday. The Associated Press reported that Paugh outbid five others for the 14 tracts in western Delaware County. Ten of the 14 tracts of land are contiguous and total 557 acres, and one tract is in eastern Madison County.
The property sold for $9,482 per acre, totaling $7.9 million.
That is more than $300 per acre in price than some of the state’s best farmland, according to a survey of land value by Purdue University that estimates value of quality farmland is selling for $9,177 per acre. The survey shows farmland values have increased overall about 19 percent from 2012 to 2013.
In the last year, favorable interest rates, in addition to the high net income from farming, has created demand for farm land while limited availability of farm property has helped to drive up the values of farm land.
Located near Muncie, off Interstate 69 along West Division Road, the property, which had taken Dale and Nina Lee a lifetime to accumulate, sold in less than two hours of bidding. In addition to 833 acres, the land is stretched within a five-mile radius, is 97 percent tillable and the farm has a 156,000-bushel grain bin storage and drying facility.
The Associated Press reported that there was big demand in the auction.
”We appreciate your interest; if you’re done, we’re done,” auctioneer R.D. Schrader said after the bidding reached $7.5 million. “Anybody else?”
After Paugh bid $7.7 million, Schrader told a group of bidders, “You’ve got 2 minutes to beat $7.7 million.”
The bids kept climbing until Paugh bid $7.9 million.
Herald Bulletin reporter Traci Moyer contributed to this story by The Associated Press.