Navigating Market Dislocations with Discipline
By Jared Hollinger, Sower Investment Partners | October 2025
Realizing Lasting Value in a Dynamic Market
At Sower, one of our core values is to Realize Lasting Value, which we define as investing in opportunities with a mindset that endures across market cycles and creates meaningful impact for years to come. This quarter, we saw that value expressed in tangible ways, from farmland stewardship to our most significant acquisition in the Longview II Fund to date. Each step reflects our belief that durable results come not only from disciplined execution, but from building platforms designed to thrive over the long term.
National markets in Q3 reflected a mix of headwinds and resilience. The U.S. economy continued to expand at a roughly 3% annualized pace, supported by steady consumer spending and investment, even as households became more value-conscious. Inflation remained sticky, yet Treasury yields eased back toward the 4% range as the Federal Reserve signaled readiness to pivot toward gradual rate cuts. For investors, this combination offers modest relief on discount rates, underscoring the importance of conservative underwriting and stress-tested strategies.
In agriculture, operators faced tighter credit and declining commodity prices. Commercial real estate performance continued to bifurcate amongst asset classes, with necessity-driven retail outperforming even as other property types lagged. Venture markets remained selective, with investors demanding clearer paths to profitability and durable growth models. Against this backdrop, Sower’s diversified platform and long-term approach position us to realize lasting value even in uncertain markets across our core verticals: farmland, commercial real estate, and ventures.
Farmland: Expanding Stewardship in Challenging Conditions
Agriculture continues to face headwinds from softer commodity prices, higher input costs, and a more selective credit environment. While difficult for operators, these pressures create opportunities for long-term investors. In this report, we highlight the Welsh Farm lease in Johnson County, Iowa, a prime 186-acre property that expands our Midwest platform. With a focus on soil health, sustainability, and tenant alignment, Welsh Farm reflects our disciplined approach to building a resilient farmland portfolio.
Beyond this single acquisition, Q3 reinforced our conviction that today’s environment may create one of the best entry points in years for farmland investors. By integrating soil testing, conservation practices, and tenant support, we are positioning assets to deliver stable returns while realizing lasting value for our investors and safeguarding one of the world’s most essential resources.
Commercial: Advancing Scale Through Strategic Acquisitions
Retail remains one of the most resilient real estate sectors, with national vacancy rates near record lows and demand holding strong for essential-service tenants. This quarter, Sower completed its largest acquisition to date in the Longview II Fund with Broadway Commons in Rochester, Minnesota. Anchored by national brands and strategically located near the Mayo Clinic’s $5 billion campus expansion, this acquisition highlights our strategy of targeting secondary markets with strong fundamentals and long-term growth potential.
More broadly, Q3 highlighted the strength of necessity-driven retail across our portfolio. Nationally, new supply remains structurally constrained, cap rates have stabilized after a period of volatility, and liquidity is strongest for prime, daily-needs centers. Tenant demand remains robust, cash flows continue to perform, and smaller, higher-productivity box formats are in favor. By combining disciplined underwriting with active asset management, Sower is advancing scale while realizing lasting value through resilient, income-producing assets.
Ventures: Driving Growth at the Intersection of Finance and Innovation
Despite tighter venture markets, opportunities persist for platforms that deliver clear customer value and sustainable growth. This quarter’s focus is on Crescent, a fintech company that modernizes business banking by combining high-yield cash management with seamless payments and enterprise-grade security. Crescent represents the type of innovation we seek in ventures: companies solving inefficiencies while building scalable, durable businesses.
In Q3, our Ventures platform reaffirmed its commitment to partnerships where strong leadership, customer traction, and defensible models are evident. In a capital environment that favors discipline, we see our selective approach as a competitive advantage. Each investment is designed not only to capture near-term growth potential but also to align with our broader strategy of creating long-term, asymmetric opportunities that realize lasting value for investors.
Closing Thoughts
Q3 underscored the importance of discipline in uncertain markets. Moderate economic growth, sticky inflation, and a likely Fed easing cycle set the backdrop for both risks and opportunities. From expanding our Farmland platform to advancing scale in commercial real estate to backing innovative ventures, Sower remains focused on delivering durable returns and building long-term value.
In all these efforts, we remain guided by our commitment to realize lasting value for our investors, partners, and the communities in which we invest.
As always, thank you for your continued partnership.
All the best,
Jared
