Real estate entrepreneur and former Air Force officer Trevor Hightower has set his sights on a new challenge: Finding the most fertile land in the United States.

The Dallas executive, who has a rich history in real estate beginning as a financial analyst at Ridge Property Trust in Los Angeles, has been named a partner at Macfarlan Capital Partners, a Dallas-based private equity real estate investment firm, to help grow its agricultural land investments.

In his new role, Hightower will share in the management responsibilities of Macfarlan Capital, as well as acquisition, investor services, asset management and reporting operations. Previously, Hightower was the co-founder and CEO of Craftwork, a company that teamed up with apartment owners to bring hospitality, such as coworking, events and coffee shops, to residents.

Prior to Craftwork, Hightower was a managing director at CBRE and a managing director of leasing at Parkway Properties.

"With all this general economic uncertainty, we see investing in farmland as having all the cool attributes, like an operating income, inflation hedge and an asset that appreciates in value, which makes it an attractive investment in this environment," Hightower told CoStar News in an exclusive interview. "It is also a low correlation to other asset classes and there's an opportunity of the total U.S. farmland, which has an aggregate value of $3 trillion, to be as large as multifamily with not as many institutional investors in the space."

The move by Macfarlan Capital to invest in U.S. agricultural farmland, of which the firm owns about 20,000 acres in Montana, with plans to add to the portfolio with multiple purchases this year, comes as lawmakers are pushing for more scrutiny of foreign investors buying U.S. agricultural land.

The U.S. Department of Agriculture reported that foreign investment in U.S. farmland nearly doubled between 2010 and 2020. Foreign investors owned nearly 37.6 million acres of U.S. agricultural land at the end of 2020, the government entity reported.

"It's pretty evident that some of the largest buyers to date are coming from other countries," Hightower said, adding he hopes that proposed changes in the law requiring more due diligence by sellers to find the true buyer behind shell companies meant to shroud identities will ensure the stability of the country's food supply. In Texas, state legislators are considering a bill banning the sale of land to investors from China, Iran, North Korea and Russia.

"There's a reason why there's bi-partisan sentiment to be careful about selling to non-U.S. entities. It's not beneficial for the country," Hightower said. "I think it will take a combination of legislation and a commitment from landowners to do more due diligence. It's a question of national security."

By year's end, Macfarlan Capital plans to close on two or three additional acquisitions, bringing the firm's portfolio of owned farmland to 50,000 acres. In the next two years, Hightower said he expects to expand the firm's portfolio to 100,000 acres of high-yielding agricultural tracts. Like other commercial real estate investments, Macfarlan Capital has also teamed up with an operating partner to oversee the commercial farming activity. The firm has been looking at future land deals in Montana, North Dakota and Texas.

Macfarlan Capital's operating partner in Montana is Jeff Lodahl. If the firm goes to other states, Hightower said they expect to seek farming partners in those areas as well, who are key to the investment. In Montana, the acreage owned by Macfarlan produces crops such as lentils, wheat and flax.

The risks of the farming business range from natural disasters to uncertain commodity markets, Hightower said. To mitigate those risks, the firm uses farm and crop insurance as a safety net against the loss of revenue stemming from natural causes. For commodity market risk, the firm hedges its bets with futures contracts, he said.

"Farmers, the ones who do it really well, are like rock stars," he said. "It's similar to investing in any great entrepreneur or business, you want a great farming partner."

Hightower, who grew up in Plano, Texas, came back to Dallas-Fort Worth after building his real estate career. After attending the Air Force Academy in Colorado where he played football, Hightower got his first job in real estate as a financial analyst for a private real estate investment trust in California's Inland Empire. He later worked in Houston for brokerage firms before arriving in the Fort Worth area with his family in 2019.

The longtime real estate executive has a history of working in traditional asset types, like industrial, office and multifamily, but has pivoted to farmland with his move to join Macfarlan Capital. The firm itself has a history rooted in value-add investment and ownership of office and retail real estate but moved to farmland as an investment in the past year.

"The time may come again to invest in those asset classes, but in this season, we are convinced farmland is an important category of real estate to own for the long term," Hightower said, adding that private investments in farmland can generate a 14% to 15% return rate over a 10-year hold.

Dean Macfarlan, who founded Macfarlan Capital, was an investor in Craftwork, which Hightower co-founded and led as its CEO. Mac Macfarlan, his son and managing partner of Macfarlan Capital, said he's known Hightower for a decade, watching him interact with colleagues, investors and employees in various leadership roles at some of the largest real estate companies in the world and in entrepreneurial ventures.

“He is passionate, intelligent, fun, thoughtful, kind, driven and brave, and joins the firm at a pivotal time as we focus on growing our leadership in agriculture investing," Mac Macfarlan said in a statement.

Hightower, who was once the captain of the Air Force Academy football team, has now stepped up to coach his 11-year-old son's football games. In Aledo, Texas, just outside of Fort Worth, football is a big part of the city that has about 5,000 residents. Hightower and his wife also have two other children.